University of Minnesota - UMN Executive Leadership Insights
Managing Brand Equity
Book

Managing Brand Equity

Capitalizing on the Value of a Brand Name

David A. Aaker
Free Press, 1991
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Editorial Rating

5

Qualities

  • Background
  • Concrete Examples

Recommendation

Think Coca-Cola and what comes to mind? That’s brand power. Author David A. Aaker illustrates how such powerful brands connect with customers. Unfortunately, Aaker doesn’t show you how to build up your name or how to make the most of your ad dollars. But he does provide compelling, insider case studies, going back to the launch of Procter & Gamble’s Ivory soap in 1881. Aaker sets three goals and just about achieves them: 1) Show managers how brand equity provides value, 2) Showcase examples of good and bad marketing and 3) Discuss how to manage brand equity. But, while Aaker explains brand equity by listing its components, the correlation between the parts and the whole is not clear - even with the ever-present flow chart. Regardless, being as well-known as IBM would make you tingle, and if you are looking for interesting historical perspective more than practical managerial advice, getAbstract recommends this book, particularly to advertising and marketing executives.

Summary

The Basics of Brand Equity

Your business’s brand name is its most important intangible asset. It is the basis of competitive advantage and of future earnings, yet it is seldom managed in a coordinated, coherent manner. Yet, many managers don’t think about building long-term brand equity.

Brand equity links to five assets: brand loyalty, name awareness, perceived quality, brand associations and proprietary pluses such as patents, trademarks and relationships. Brand equity provides value by attracting new customers and retaining old ones, increasing loyalty and providing a platform for growth via brand extensions. Gaining new customers is expensive, but keeping existing ones is comparatively inexpensive. A sound customer base helps your brand, because existing customers can help generate new customers.

Most people buy familiar brands because they are comfortable with what they know. They reason that if it is familiar, it is reliable and here to stay. Customers believe in the quality of the products they buy. Perceived quality influences buying and brand loyalty, especially when a buyer is not motivated or can’t comparison shop.

Brand Loyalty

Brand...

About the Author

David A. Aaker  has written more than 70 articles on branding and eight books on branding, advertising and business strategy. Aaker currently is the J. Gary Shansby Professor of Marketing Strategy at the University of California at Berkeley.

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