In today’s competitive market, it is essential that businesses cultivate their customer relationships to succeed. Businesses must focus on customers to create the value necessary to develop a strong brand identity to stay ahead of their competitors. The value of a brand is determined by the consumer’s perception of the brand. Therefore, it is imperative that businesses stay competitive and create value by putting more emphasis on customers to build their brand equity.
Increasing value to the business drives growth and increases profits. Building brand equity will help businesses to maximize profits and return on investment, achieve successful long-term growth (customer lifetime value), and outperform their competitors. The key methods to consider when building brand equity include:
Identifying what makes the brand different and increase awareness about the brand and focus and values of the business. Customers should recognize the brand as well as view the brand in the manner the business views the brand.
Convey to the customer what the brand represents and stands for as well as how well the brand or product meets their needs.
Utilize the customers’ responses, feelings, criticism, and judgments about the brand as opportunities to increase customer satisfaction, make the product (brand) more profitable, and make product modifications by reassessing the credibility, quality, and relevancy of the product relative to the needs of the customer to improve their responses toward the brand.
Forming deeper customer relationships will help businesses obtain a better understanding of customer’s needs and desires to attract repeat customers; customers will have a stronger connection with the brand.
Additionally, a customer’s loyalty to a brand is a vital part of brand equity. Loyal customers are faithful with a brand they trust and have a close and emotional association with a product or brand. A business should ensure the quality of the product or brand, exceed its customer’s expectations about its value, and be consistent in service and delivery. Also, rewarding loyal customers is a great way to build brand loyalty. Rewarding loyal customers helps keep them happy and emotionally invested in the success of the brand and are less likely to switch to a competitor’s brand. For instance, SEPHORA, a French multinational, chain of beauty and personal care, is well-known for its success in encouraging their customers to support their brand by rewarding them through their participation in their loyalty reward program. In fact, 80% of SEPHORA’s transactions are generated through their loyalty program (Beauty Insider Program). The program was created in 2007 and their customers receive rewards based on different tiers which is determined by how much the customers spend. They also give their customers personalized product recommendations, free makeup classes, and birthday promotions to make them feel special. Furthermore, if they’re in a higher tier, they can choose to have a product shipped for free or have a free makeover.
Building brand equity provides significant value to businesses in many ways. It increases the revenue and sales for a company. It also increases their market share as the brand continues to grow and become more recognized by customers as their preferred choice. Brand equity also gives a business a competitive edge over their competitors. Brand equity is essential in achieving overall success and sustainability.