Brand Equity is the positive, distinctive effect that knowledge and associations with a brand have on a customer’s response to the product or service offered under that name. Essentially, it is the added value that the brand name gives to the product, beyond its functional value.
High brand equity means that customers respond more favorably to the brand’s advertising, are more likely to purchase it, and are willing to pay a higher price for it than for a generic or unbranded equivalent. Brand equity is a core asset that is built through ongoing investment in product quality, communication, and the creation of strong, positive associations in the minds of consumers.
