How to Build Brand Equity

Brand equity is the extra value a brand adds on top of the basic product. Take two pairs of running shoes made in the same factory with roughly the same materials. One has a Nike swoosh on it, the other doesn’t. We will pay more for the Nike pair, and a lot of us will actively prefer it even before we’ve tried it on. That gap between what the product is physically worth and what we’re actually willing to pay for it because of the name on it is brand equity.

It sounds like a soft, fuzzy idea when we first describe it that way, and in a sense it is. But it shows up in very hard numbers. Interbrand, the consultancy that publishes the best-known annual brand valuation report, puts Apple’s brand value at over $470 billion in its 2025 rankings, ahead of Microsoft, Amazon, and Google. That is not the value of Apple’s factories, patents, or cash in the bank. It’s the value analysts assign specifically to the brand itself, separate from everything else the company owns.

So when we talk about building brand equity, we’re talking about building an asset. It sits on the balance sheet in a strange way (accountants have long arguments about how, or whether, to record it), but it behaves like one. It can be grown, it can be damaged, and it can be sold, licensed, or leveraged to launch new products. Our job as marketers is to understand what actually builds it.

What Are We Actually Building?

Marketing academics have spent decades trying to break brand equity down into pieces we can actually manage, rather than leaving it as one vague blob called “goodwill.” Two names come up constantly here: David Aaker and Kevin Lane Keller.

Aaker’s model splits brand equity into five assets: brand loyalty, brand awareness, perceived quality, brand associations, and other proprietary assets like patents or trademarks. Keller’s model, often called the Customer-Based Brand Equity model, builds it more like a pyramid.

We start at the bottom with brand salience (do people even know we exist and when to think of us), then move up through brand performance and imagery (what does the product actually do, and what does it feel like to own it), then brand judgments and feelings (do people trust it, respect it, feel good about it), and finally brand resonance at the top, which is the deepest level: genuine loyalty and a sense of connection to the brand.

We don’t need to memorize every layer of every model for this to be useful. What both are really saying is the same thing from different angles: brand equity is built from awareness, from what people believe about the product, and from how people feel about it. Get all three moving in the right direction and the brand becomes worth something on its own, separate from any single sale.

Awareness Comes First, and It’s Cheaper Than We Think to Underrate

Before people can trust a brand or feel loyal to it, they need to know it exists and remember it at the moment they’re making a decision. This sounds obvious, and it is, but it’s also where a lot of equity actually gets lost. A brand nobody thinks of doesn’t get considered, no matter how good the product is.

Think about how often we default to a brand out of habit rather than active comparison. When we need a tissue, plenty of us ask for a Kleenex even if the box in front of us says something else. That is an extreme, almost generic-name level of awareness, and it took decades of consistent exposure to get there. Most brands are nowhere near that level and don’t need to be. But the basic mechanism is the same: repetition, consistency, and being present at the moments when the category comes to mind build awareness, and awareness is the floor everything else sits on.

Perceived Quality and Associations: What Do People Actually Believe?

Once people know a brand exists, the next question is what they believe about it. Perceived quality matters more here than actual quality, and that distinction trips a lot of students up. A brand can genuinely improve its product and still lose ground if the market’s perception hasn’t caught up, and the reverse happens too: a brand can coast for years on a quality reputation built a decade earlier.

Associations are the other half of belief. What does the brand make us think of? Volvo has spent decades building an association with safety, so strong that “as safe as a Volvo” functions almost as a category description on its own. Patagonia built an association with environmental responsibility, partly through actual product decisions and partly through visible actions like donating its Black Friday sales to environmental causes.

These associations don’t happen by accident. They’re built through consistent messaging, consistent product decisions, and enough time for the association to actually stick in people’s heads, which as you can probably guess is not something that happens over a single ad campaign.

Loyalty and Resonance: The Payoff

If awareness and belief are working, we should eventually see loyalty, meaning customers who keep buying, who don’t switch when a competitor cuts price, and who forgive the occasional mistake. This is where brand equity actually pays for itself financially, because loyal customers are cheaper to keep than new customers are to acquire, and they tend to buy more over time.

Loyalty at its strongest becomes what Keller calls resonance, where the brand becomes part of how people see themselves. Someone who feels like a “Nike person” or an “Apple person” isn’t making a purely rational comparison of features and price every time they buy. They’ve stopped shopping the category and started just buying the brand. That’s an extremely valuable position to be in, and it’s also the hardest one to reach.

What Does This Mean for a Marketer Making Decisions?

All of this matters beyond the classroom because it changes how we should judge marketing decisions. If brand equity is an asset, then a lot of marketing decisions that look like short-term wins can actually be long-term costs, and a lot of decisions that look expensive in the short term can be investments.

Take pricing promotions. A deep discount can move volume this quarter, and the sales team will like the number. But run too many promotions and we start training customers to associate the brand with being on sale, which erodes perceived quality and trains people to wait for the next discount instead of paying full price. We’ve spent money to weaken the very asset we’re trying to grow.

Brand extensions raise a similar trade-off. A strong brand can often stretch into a new category faster and more cheaply than starting from zero, because it borrows existing awareness and trust. But stretch it too far, or into a category that clashes with what the brand stands for, and we risk diluting the associations that made the brand valuable in the first place. A premium brand suddenly appearing on a discount product can confuse people about what the brand actually represents.

There’s also the question of how we measure this for a budget conversation. Brand equity doesn’t show up cleanly on a quarterly sales report, which makes it a hard sell internally when finance wants to know what a brand campaign actually returned this quarter. Marketers usually have to track it with a mix of tools: brand tracking surveys that measure awareness and perception over time, price premium analysis (how much more can we charge versus an unbranded or generic competitor), and customer retention or repeat purchase rates. None of these give a single clean number the way a click-through rate does, so we usually have to make the case with several metrics moving together rather than one.

We also have to think about consistency across every touchpoint, not just advertising. Packaging, customer service, the in-store experience, even how a delivery driver interacts with a customer, all feed into what people believe about the brand. A brand can run a beautiful ad campaign and still lose equity if customer service is inconsistent or the product breaks too often, because those experiences are also building associations, just not the ones we wanted.

Great Ways to Build Brand Equity

Below is a checklist of factors that will be beneficial in building brand equity.

• Good product quality relative to competitive offerings
• Offer a wide array of products to cater to different customer needs and preferences
• Valuable differentiation in products
• Clearly defined unique selling proposition
• Positioning your brand as a unique choice
• Having unique product features
• Continuously innovate to add unique features
• Frequent technology breakthroughs
• Frequent new products
• Continuous customer engagement
• TV advertising is a key platform for strong brands, particularly in the FMCG’s sector
• Publicity and media attention
• Attention from blogs, forums and online comparison sites
• Successful social media campaigns and engagement
• Viral videos
• Word-of-mouth (WOM) – either online or face-to-face
• Influencer marketing
• Use of celebrities in advertising or celebrities using the product
• Product placement in TV shows and movies
• A high profile CEO is another way to help build brand equity, as they re recognizable and more likely to gain media attention
• Highly trained and interpersonal, friendly staff
• The number of retail channels used – the more outlets, the more visible the product
• The retailer’s brand equity – there will be a brand association coming from the retailers and their brand equity will transfer to the brands that they sell
• The brand’s prominence within the retailer – is it in main store locations and displays?
• A positioning strategy built around price value
• Develop partnerships or co-branding opportunities with other reputable brands
• Increase product visibility through advertising, presence in multiple retail locations, and online platforms.
• Utilize social media platforms to engage with customers
• Create a community around your brand
• Position your product as a status symbol or luxury item if appropriate
• Offer products that not only serve a functional purpose but also contribute to the customer’s self-identity or provide entertainment value. This emotional connection can strengthen brand loyalty
• Aim to increase market share as it often correlates with brand strength. A popular brand is perceived as a trusted choice
• Cultivate a reputation for integrity through honest marketing, quality products, and ethical business practices. Customer trust significantly boosts brand equity.
• Ensure your staff provides exceptional customer service and knowledgeable sales advice. Positive customer experiences directly impact brand perception
• Tailored marketing strategies to these segments can lead to a stronger connection with your audience
• Expanding market coverage, including global reach, can enhance brand prestige and recognition. A globally recognized brand often holds high equity
• The longer a brand has been in the market, the more it can build on its heritage and establish trust. Longevity can be a sign of reliability and quality.
• Engage in socially responsible practices. Brands that demonstrate a commitment to social causes often build emotional connections with their audience.
• Employees should embody the brand values in their interactions with customers. Positive employee behavior can reinforce brand values and improve customer experiences
• Providing excellent after-sales support, including customer service, warranties, and easy returns, enhances brand loyalty and trust
• Develop and share a compelling brand story that resonates with customers, enhancing emotional connection and brand identity
• Implement loyalty programs that reward repeat customers, encouraging continued engagement and enhancing perceived value
• Ensure consistent brand messaging across all marketing channels to reinforce brand identity and message
• Offer customizable products or services to cater to individual customer needs, enhancing perceived value and differentiation
• Engage in strategic sponsorships and partnerships that align with the brand’s values and target audience
• Utilize AR and VR to offer unique and immersive product experiences, showcasing innovation
• Develop an interactive and user-friendly website and mobile app, enhancing the customer experience and engagement
• Build online communities where customers can interact, share experiences, and offer support to each other, strengthening brand loyalty
• Implement effective Customer Relationship Management (CRM) systems to personalize customer interactions and improve service quality
• Develop a network of brand ambassadors who genuinely love and promote the brand, enhancing credibility and reach.
• Aim to achieve quality certifications and awards, which can be used to enhance brand credibility and trustworthiness
• Actively participate in community events and charitable activities, building a positive brand image and demonstrating corporate social responsibility
• Continuously update and improve products based on customer feedback and market trends to stay relevant and competitive
• Leverage big data analytics to gain insights into customer behavior and preferences, guiding strategic decisions
• Have a solid crisis management plan to protect brand reputation in the event of any negative occurrences
• Create high-quality, informative content that provides value to your audience, establishing your brand as a thought leader in the industry
• Target niche markets with specific needs to create a strong and loyal customer base
• Offer support and marketing materials in multiple languages to cater to a diverse customer base, enhancing global appeal
• Host and participate in both virtual and in-person events to increase brand visibility and engagement
• Consider a brand relaunch or rebranding to revitalize the brand, especially if the market has significantly changed
• Encourage and showcase UGC, like customer reviews and testimonials, to enhance credibility and relatability
• Create memorable, hands-on experiences that allow customers to engage with the brand in a meaningful way
• Use innovative and attractive packaging designs that stand out and resonate with the brand identity.
• Create forums or panels where customers can discuss products and services, providing valuable insights and fostering community
• Align your brand with a specific archetype (like the Hero, the Rebel, etc.) to create a relatable personality and emotional connection
• Partner with micro-influencers who have a highly engaged audience relevant to your brand
• Employ creative, unconventional guerrilla marketing tactics to generate buzz and surprise elements
• Consider a subscription-based model for steady revenue and consistent customer engagement
• Share aspects of your company culture, such as team events or behind-the-scenes looks, to humanize the brand and create a deeper connection with customers.

Sources

• Interbrand, Best Global Brands 2025
• Keller, Kevin Lane, “Conceptualizing, Measuring, and Managing Customer-Based Brand Equity,” Journal of Marketing, 1993