Defining Brand & Equity
What is brand equity? The value the brand creates in the market place. Having a recognized brand name and for people to associate with a particular product or service. That's what creates the value in a brand. That's why you can buy no-brand name salt, or you can buy Himalayan Salt, right? There's a value in between having a brand name, an experience and something associated with it. And the brand equity is also made up by all the different elements that make it distinctive, that sets the product apart, you know, visually, physically, the communications and the visual expression. So, it's a very common term used in branding, so the equity we're really referred to as much as the value that is in the brand, to all its components. So, let's study then, the most common representation of equity, which is a pyramid. And the reason why it works as a pyramid is that you have four key elements that are all supporting each other. You have in the bottom, the ownable assets, which is really what t...
he consumer is trained to see and recognize the brand for, ownable assets and that example of the Coca-Cola red, the shape and the script. And then we're gonna look at some examples. The unique benefits is what you do better than competition, what sets you apart. And again, you should be striving for superior benefits. The brand promise is actually what you do, what you deliver, what you should be expecting as the consumer. And the ideal is the brand's why. It could connect to your mission, connect to the higher order purpose, and all these components support each other. They play different roles. That's why you have to define them. But all together, should bring to life what the brand is all about. So, we're gonna look at the first one. We're gonna start top to bottom. So, the ideal, best way to think about it is, the reason why the brand exists. So, a simple exercise you can do when you're creating your position is, Brand X exists to why? So, it's really the why. Why you create the products or services. And sometimes you can even be connected to the mission or purpose, as we've talked. That's why you are here in the world as a branded product or service. And there's a few questions that you can think through if you're finding your way to your earlier questions. You know, how do I find my vision? What is my ideal? So, one helpful question would be is, what is the brand actually helping people do, right? Is it a brand that is in the business of helping you achieve status? Are there types of self-actualization that goes beyond just using the product? What type of positive emotions do you create, right? There's a lot of emotions associated with using a product or a service. Are there any that you would want to latch onto? Or maybe the brand is about establishing connections. You know, does it bring other people together? What does the brand allow people to do? Or, let's look at some others. How does the brand impact society positively? Hopefully not negatively, 'cause you should not be in business if that's the case. And also, if you're the founder, or have a product where you have a service that is inspire by a particular person, why would they say it inspire them to create that product? And typically, you know, if you look at the big brands, for example, Chanel and some of those where the founder continues to be rooted in their communications and their products. It's typically about a human-y or particular space that they're looking to improve on. It tends to be quite aspirational. So, those are a few questions that you can ask yourself in terms of guiding, you know, finding your ideal. Let's look at some examples. So, from Google, you know, they would articulate, call it their ideal to organize the world's information and make it universally accessible and useful, right? That is how they make a difference. Here, necessarily doesn't talk about their search product. It doesn't talk about, you know, necessarily what they offer, but what are they here to do? Okay, Apple, a favorite brand of today, is empower creative exploration and self-expression, right? That goes well beyond selling iPods and computers, right? It's about a self-actualization type of benefit of unleashing creativity. Then we have Hermes, a luxury brand, you know, crafting timeless luxury, right? In a more, in a different space called the emotional space, but that's the role they play. A few others, Red Bull, uplift mind and body, energize the world. And you can see how that is very much consistent with what you see. And this doesn't talk about, you know, a sugar drink, right? We will talk about some of those elements. We're really going, you know, top of the pyramid. MasterCard, we're gonna talk about MasterCard throughout the presentation. Make the world's commerce more simply, more effective. Or Zappos, online company delivering happiness through wow service. It's a way in which they set themself apart. Nothing here is about, you know, shipping shoes, right? Or commerce, so hopefully you start to see the difference as we go down. So, that's the top of the pyramid when we talk about ideal. And we're really trying to answer the why. Let's continue to brand promise. So, if the brand ideal is the why the brand exists, the brand promise is how the brand delivers on that. So, it basically, what the brand actually does. And, the best way to think about it is a statement of what the brand uniquely offers and what's that core benefit? What are those things that you really do better than anyone else but set you grounded in the industry that you participate in. So, let's look at some examples to articulate this. The best benefit articulations do a few things. First, it drives difference versus competition. So, you can see what drives the consumer preference. Two, is relevant to your target, the consumer that you really care about. It's tight and memorable, so you can remember it. And then it links to the category. And if you look at these three examples, BMW, the ultimate driving machine. Southwest, the short-haul, no frills and low cost airline, or Home Depot, the hardware department store for do-it-yourselvers, delivers on all those characteristics. It drives difference versus competition, is relevant to the specific target, it's tight and memorable. Some of these could even be taglines if you wanted to use them, and then it links to the category. Very important that you know which category you are in. Can you start to see the differences with ideal and promise? Becomes much more specific. Then we have benefits, and the benefits, as we talked is, uniquely what does the brand do to solve a specific consumer need. And that's how you basically, what you call, points of difference. These are the different characteristics of your product of your service. What you do better than anyone else. And it could be functional or emotional. So, what I like to do typically, to articulate benefits, is to see how there's different characteristics of them in terms of being able to articulate the need that you're trying to solve. So here, in the functional department, you have performance. So, call it your deodorant brand. So, you know, your benefit would be about odor protection that lasts all day, okay? So, that's what you do, right? And you wanna do that better than anyone else. Or, aesthetic features, right? If you're an orange juice brand, maybe if your packaging is what is most distinctive about yourself, environmentally friendly package is an aesthetic point of difference versus other brands that you would call out. If you are on the emotional space, for example, you could talk of usage, or you could talk about ingredients or technology. For example, if you have a patented rejuvenating formula in your skincare brand, that might be the one ingredient that you will capitalize on to communicate and to set yourself apart from others. Here are some others, for example, pet food brand. If you are about, you know, add that relationship that the owner has with the dog. You know, you could articulate a point of difference where it's about helping your dog be healthy and thriving. You know, for the specific type of consumer that might celebrate their dog's birthday, which is, you know possible that there's many consumers that have that relationship with their dog. A benefit like this for a brand might be the right way to communicate, versus just talking about the vitamins, which would be a very much functional type of characteristic, and then on and on and on. So, here, what you see is, depending on your industry, depending on your business, the key is to really articulate what is that one specific benefit. And you can have a few. So, I don't recommend having more than three things that you're great at. This is not a feature list. So, don't put a feature list in your equity pyramid. It's those two, three things, sometimes it could be one, that you're going to be best in class at and the reason why people are going to buy you. Ownable assets, the way to think about, if equity is the value of your product, your recognizable assets is the currency because that's what people see. That's where the money is at 'cause remember, that's what you have been investing in getting people familiar with. So, that's why many of these most trusted and most recognizable logos become copyrighted. And becomes actually line items in a brands PNL. 'Cause there's so value in being able to be recognized. And, similarly, in this section is not, not everything you do is ownable. So, here you might find one or two things that actually are ownable, and you honestly, if you're a new brand, you might not own anything. You know, owning an asset is something that happens over time, but it's important for you to declare what is it that you really want to be consistently using for people to recognize you. So, here are some examples. You know, and you might agree, oh, yeah, I know these. So, if logo is an ownable asset. For example, Starbucks logo is how people recognize the brand. You know, the Nike swoosh, for example, is how people would recognize the brand. You know, you could also pick sound as the characteristic. Like the Intel sound, you could probably play it in your head, that sets them apart. The sound of Harley. That's something very particular to the brand. We talked about the shape. Like the Coca-Cola shape or the Volkswagen Beetle, right? That shape is quite recognizable. Tiffany blue, that's a color, you know it's a Pantone color. You know, it's, I'm imagining it's in their pyramid. Patterns, right, Louis Vuitton and Burberry are patterns that are quite recognizable in the luxury category. Photography style, Ralph Lauren. Typography, Disney, right, so you can easily recognize when the Disney font. Smell, some brands, for example, the Westin makes a big point on everything that they do to have their White Tea scent. Or Cinnabon, who has walked around in an airport and can resist the smell of the cinnamon. That is an ownable asset because it drives their brand. It drives to recognition. And, finally, here an icon, for example, the Pillsbury Doughboy or Michelin, for example, tires. The icons they use. That's an ownable asset. But the key here is to know that you're going to nurture specific element of your branding choices on how people will recognize you. So, to wrap up this section, I'm gonna show you in an example, one of my favorite brands that we talked about earlier, how the different components support each other. And that is the brand Harley Davidson. I picked this example because it's really one brand that is not only a star brand, but also, you can see how the different elements support each other. So, first, when we think about the brand ideal, the reason why Harley does what it does is the why, is fulfill dreams of personal freedom. So, and actually, to your earlier question, Harley, actually proudly displays this statement in their website, so the brand ideal, you know in the mission, you can communicate it, if you're Harley, because people will see through that that's what you're in for them. And here, you basically know that it's connected to their vision. Then you have the brand promise and a few characteristics. You have authentic American motorcycle experience. It's quite distinctive versus the market, right? This is not something that Yamaha would have on their equity pyramid. It talks about their category, right? But it's not just about buying bikes, it's about that experience and it also had this authenticity brings to life a little bit of the character of the brand that makes the brand so unique, right? So, you can see there what the brand delivers. But you have to support it on things that you do differently, right? So, you have the first, it could be a functional benefit. Powerful ride with a V-Twin engine. I'm not an expert in motorcycles, but I know, that the V-Twin engine, actually is one of those core distinctive elements on how the brand actually started. It's the most famous performance feature that they have. And that speaks to the performance characteristics of that motorcycle experience. Craftsmanship that enables customization. If Harley is about personal freedom, speaks to individualness, right? So, being able to customize your bike is not just a choice the brand is making just because. It's because it supports that overall vision. So, see how it starts to support and the ability to actually impact how your bike looks, the different elements, the different lineup, just for you, is delivering on the brand promise. And heritage, so, 110 years of heritage speaks to the longstanding reputation, which comes to support, as well, that authentic American experience, right? And you can see that that's something that the brand prides itself on, and you can see it throughout their execution, right? This is not about a brand that changes continuously, right? They have a very, a very well-defined persona that even time, and they have many different ways to keep it fresh, but these three elements have been consistent over time. And then finally, actually, Harley is such a strong brand that they are allowed to have a few ownable assets in their pyramid. The logo, quite recognizable. The sound, right? Not all brands have a sound that is recognizable and ownable, but Harley is no miss. You can even see it in movies, or you know, have to be watching. The bike design, of course the low profile. That's very particular to how they have become recognized. And then, an exception on this one, the Harley's owner's group, The Hogs, made it to the equity pyramid, because in general, any marketing activity or partnerships, is not really an ownable asset. But for Harley, for the last couple of years, the brand has been built on people recognizing the brand in rallies and building the relationships through rallies. And you cannot see again, you know, a Suzuki or a Yamaha brand, or a rally of those bikes. It would never happen. It's owned by Harley. So, that's why, in this example, I picked these so that you could see, what does really mean to own an asset? And this is not something that happens right away, it happens over time, but you should declare, okay, I'm gonna pick this. That's why, how you're called, your logo, your experience, pick a few things that you really, really want to repeat over and over again, okay? So, this covers the positioning section of the step number two, and then we're gonna talk about target in a second. But hopefully here you can see and you will have some of these templates to fill on your own as well in your journey of defining positioning. What are the different components that you're going to select in order to have a very strong positioning and clear positioning for consumers so that they know who you are and why they should be buying you.