Dimensions of brand equity

Dimensions of brand equity

The available literature has focused on the five dimensions of brand equity: performance, value, social image, trustworthiness and commitment. These dimensions could be re-classified into four dimensions: brand awareness, perceived quality, brand associations and brand loyalty. Brand awareness refers to the ability of a consumer to recall and recognize that a brand is a member of a certain product category. The aspect of recognition provides a brand with a sense of familiarity. Firms tend to enhance brand and name awareness by using slogans, and through symbol exposure. Perceived quality of a product refers to buyer’s perception about the overall quality of a product relative to other alternative products. If a product is perceived to have high quality, the seller can charge a premium price for it. It is also encourages the distributors to invest more in order to provide the goods to the customers. The advantages of a perceived quality of products are numerous. In order to achieve these advantages, firms are always willing to invest in the product through advertisements and to improve other components of quality which include: objective quality, product-based quality and manufacturing quality. Firms take advantage of perceived quality of a brand name by using it to expand other product categories. The concept of brand extension in a firm helps an organization to use the existing platform. This concept has become popular since the costs of establishing a new brand name is prohibitive. Firms use several strategies and some of the popular ones that have been researched on include line extensions, flanker brands and co-branding. Most brand names have recognition levels of more than 95% which means using the recognized name to bring new products into the market, reduces the communication task on the part of the consumer. A number of studies have been conducted to examine the factors that motivate firms to use brand extensions. The primary motivating factors are to reduce advertising costs and to avoid the introduction risk of a new product.

The role of brand equity to a customer and an organization has also been examined. Brand equity creates value for enhancing satisfaction, confidence in the purchase decision and processing of information. On the other hand, brand equity creates value for an organization by enhancing, the effectiveness of marketing programs, brand loyalty, price margins, brand extensions trade leverage, and competitive advantage.

Brand associations, refers to the perceptions that customers have about a particular brand. Brand associations help a firm to differentiate its products from its competitors. The connecting associations are classified in the following groups: product attributes customer benefits, relative prices, application, celebrity endorsement, lifestyle, product class, and competitors.

A number of researchers have examined the relationship between branding and loyalty. In addition, researchers have examined the levels of brand loyalty across all age groups. One such study that was conducted by Cartlin (2004, p.42) indicated that brand loyalty increases with age. In other words, old age buyers are more likely to practice brand loyalty than 20 to 24 year olds. The concept of customer loyalty has been evaluated by examining different types of buyers: committed buyers, those who like the brand, satisfied buyers, habitual buyers and price-sensitive buyers. The available literature concur that unlike the other types of buyers price sensitive buyers do not have brand loyalty.

Although the main dimensions of brand equity are brand awareness, perceived quality, brand associations and brand loyalty, there is an additional dimension that has been suggested by Davis (2004, p.45). This new dimension deals with other proprietary brand assets such as patents, trademarks and channel relationships. Trademarks help firms to protect the equity of their brands from competitors.

The existing dimensions of brand equity have been utilized by various studies. Keller (1993, p.59) introduced a Customer-Based brand equity model, which examines the subject of brand equity from a customer perspective. The subject of brand equity has also been examined from a financial perspective. The financial perspective has been utilized to measure the brand equity by deriving market estimates from brand-related profits. The two perspectives form a combined perspective. The combined perspective has inspired many models such as the Global Brand Equity model that was developed by Motameni and Shahrokhi (1998, p.275). Having realized the financial value that is attached to brands, Dyson, Farr, and Hollis (1996, 21) also developed a similar model which is known as Consumer Value Model. All these conceptual frameworks, appreciate the importance of branding dimensions and how they relate to each other.

Application of branding

The company is an American multinational that was established in 1976 in Cupertino, California. The company is renowned for its flagship products: iPad, iPhone and iPad. All the three products work on the same operating system which means they are compatible. The company has maintained competitive advantage by coming up with innovative products. For instance, the iPad is controlled by a multi-touch display unlike traditional tablet markets which use pressure-triggered stylus. Even then, the iPad faces potential competition from the HP Slate, and other products from Dell, and Microsoft.

Apple Company products have a higher perceived quality compared to other brands such as Samsung Galaxy. The company has high brand equity levels hence high consumer preferences, higher stock returns, and purchase intentions. At the same time, high brand equity has given the company an opportunity to launch successful extensions while creating a competitive advantage.


Dyson, P., Andy, F. & Hollis, N. (1996). Understanding, measuring and using brand equity. Journal of advertising research, 36(6), 9-21

Farquhar, P. (1989). ‘Managing brand equity.’ Marketing research, 1, 23-33

Davis, S. 2002. Brand Asset Management: driving Profitable Growth through your brands. San Francisco, Josey Bass

Urde, M. 1999. ‘Brand orientation: A mindset for building brands into strategic resources.’ Journal of Marketing Management, 15: 117-133