REVIEW OF RELATED LITERATURE

To highlight the findings, this section offered current information and

findings from a variety of sources relevant to this study. This seeks to give
readers a better knowledge when it comes to market branding. This section
discusses the disciplines and literature related to the existing concept under
examination.

The impact of brand equity on customers

Before the widespread adoption of branding as a business practice,

brands were little associated with the sale of retail goods because many
products distributed for consumers’ consumption were sold as staples in bulk.
Commonly, the one general store in town carried commodities such as sacks
of coffee beans, slabs of cheese, and barrels of pickles without naming their
specific sources. At the foundation of all branding activity is the human desire
to be someone of validity, to build a personal and social identity, to show
oneself as both like other people to belong and unlike other people to stand
out, and to have a good reputation. The examination of brand equity has
mainly been centered towards determining the factors that could improve
brand value (Dinçer, Bozaykut-Buk, Emir, Yuksel, & Ashill, 2019). Consumer
products and service marketers place a high value on brand equity. Brand
equity improves the efficacy of brand expansions and brand launches. This is
because consumers who trust and are loyal to a brand are willing to
experiment with brand extensions. While methods for measuring the financial
worth of brand equity have existed, methods for measuring customer-based
brand equity have been weak. The functional performance should be
highlighted by the functional branding. These demands are satisfied by
functionally performing products and are associated with fundamental motives.
According to Park et al. (2010), through promoting efficacy and control,
brands can be managed to lessen uncertainty in consumers' lives and make it
possible to achieve desired goals. Therefore, the performance of a product is
linked to functional brands. The competitive advantage for businesses who
have brands with High equity includes the following: a price premium can be
charged obtained; increasing client demand. Poulis and Wisker (2016) tested
the effect of employee-based brand equity on organizational performance and
found that the attachment of employees to a brand represents the main factor
that contributes to better financial outcomes. In other words, we understand
what industrial brand equity is made of significantly better than we understand
what causes it to exist. This is an important gap that must be filled in order to
determine where industrial brand equity originates.

One way to achieve this objective is to create a private brand because

it reduces consumer risk and links the value-creating activities of suppliers
with buyers’ perceptions. This study indicated that the emphasis on price. Its
retail availability tended to imply that these products were still manufactured
on a commodity basis. The heavy reliance on pricing showed a low efficacy of
firms' branding initiatives. Brand equity is one of the key concepts in brand
management research (Kim, Jin-Sun, & Kim, 2008) that refers to the value
that a company generates from a product with a recognizable name as
opposed to a generic equivalent. In other words, brand equity is formed when
the product is memorable, easily recognizable, trustworthy, and superior in
quality and reliability. The related issues of customer engagement (CE) have
been always the consideration and attention of researchers and scholars over
the marketing field. Specifically, customer brand engagement (CBE), as part
of CE, plays a significant role within the marketing literature (Calder et al.,
2009; Dwivedi, 2015; Heinonen, 2011; Hollebeek et al., 2014). Brands
represent enormously valuable pieces of legal property, capable of influencing
consumer behavior, being bought and sold, and providing the security of
sustained future revenues to their owner. The value directly or indirectly
accrued by these various benefits is often called brand equity (Kapferer 2012;
Keller 2014). A basic premise of brand equity is that the power of a brand lies
in the minds of consumers and what they have experienced and learned
about the brand over time. Brand equity can be thought of as the “added
value” endowed to a product in the thoughts, words, and actions of
consumers. There are many different ways that this added value can be
created for a brand. Similarly, there are also many different ways the value of
a brand can be manifested or exploited to benefit the firm in terms of greater
revenue and/or lower costs. For brand equity to provide a useful strategic
function and guide marketing decisions, it is important for marketers to fully
understand the sources of brand equity, how they affect outcomes of interest
in sales, and how these sources and outcomes change, if at all, over time.
Understanding the sources and outcomes of brand equity provides a common
denominator for interpreting marketing strategies and assessing the value of a
brand: The sources of brand equity help managers understand and focus on
what drives their brand equity; the outcomes of brand equity help managers
understand exactly how and where brands add value. Towards that goal, we
review measures of both sources and outcomes of brand equity in detail. We
then present a model of value creation, the brand value chain, as a holistic,

integrated approach to understanding how to capture the value created by

brands. We also outline some issues in developing a brand equity
measurement system. We conclude by providing some summary
observations.

Brands are very significant pieces of legitimate belongings, with the

capability of affecting how consumers act, being purchased and sold, and
offering owners with the security for long-term earnings. Brand equity is the
power of a brand in the minds and experiences of people over time. To use
brand equity effectively, marketers must understand its sources, impact on
outcomes, and changes over time. This understanding aids in the
interpretation of marketing strategy and the evaluation of brand value. A value
creation model, the brand value chain, is provided as a comprehensive
strategy to capture brand value. The development of a brand equity
measurement methodology is also mentioned.

Brand equity itself includes the overall strength of a brand in the market
and will provide value to the company/business entity that produces the
product/service. The task of marketers here is very important to be able to
make the right design or strategy in making a brand identity that is easy to
remember and has strong assets in society. High brand equity provides a
competitive advantage for the company. Because consumers expect the
brand to be available in stores, the company has higher supply power. High
brand equity can also increase new customer loyalty and retain old customers.
So it is very important for companies to create high brand equity in order to
win the competition. brand equity as a positive differential effect caused by the
knowledge of the brand name on the customer for the product or service.
Brand equity causes customers to show a preference for a product over
another if the two are essentially identical. One of the preferences that
consumers pay attention to is the brand of the product.

According to Laroche et al. (2012), Sadek et al. (2018), Seo et al.

(2020) and Seo et al. (2018), brand equity is “the set of brand assets and
liabilities associated with the brand, its name and symbol; which adds or
subtracts from the value provided by a product or service to a company and/or
customers of that company”. Thus, brand equity itself can be categorized as
an intangible asset of a company that must be maintained. By maintaining
and increasing brand equity, it can give customers more confidence to buy
goods or services (Seo et al., 2020; Seo et al., 2018; Suharto et al., 2022).
Wantini et al. (2021) defined brand equity or brand equity as a positive
differentiating effect after knowing the brand name on consumer responses to
products or services with that brand. Brand equity produces consumers who
have choices if consumers are faced with two products that are basically
almost the same. The term brand refers to the value embodied in a well-
known brand. From the consumer's perspective, brand equity is the added
value given to the product by the brand. Brand equity is a set of brand assets
and liabilities associated with a brand, its name, symbol, which add to or
subtract from the value provided by a product or service to the company or its
customers (Laroche et al., 2012; Sadek et al., 2018; Seo et al., 2020; Seo et
al., 2018; Suharto et al., 2022; Wantini et al., 2021). Brand equity is a
collection of belongings and obligations connected with a brand, its name, and
symbol that enhance to or preserve the value supplied to customers by a
product or service. If a brand's name or symbol changes, some or all of its
assets may be modified or even lost, however some may be relocated to a
new name or symbol. Brand association is related to information on what is in
the customer’s mind about the brand, either positive or negative, connected to
the node of the brain memory (Emari et al., 2012). The higher the brand
associations in the product, the more it will be remembered by the consumer
and be loyal towards the brand. According to Pouromid and Iranzadeh (2012)
shows that the relationship between brand association and brand equity is
positive and significant.

The importance of brand equity has been recognized in the marketing

literature for at least three decades as an intangible asset that promotes firm
performance. The brand benefit is a perception created by marketers’
management of the brand. As a result, author expects that this brand concept
is an antecedent of strong brand relationship. Emotional attachment is affinity
towards the brand, with respect to other available alternatives. Emotional
bonds may range from feelings of warmth to true passion (Thomson et al.,
2005). Marketing managers are able to justify expenditures on promotions
that have the potential to generate such long-term consumer effects as
emotional attachment and customer commitment (Brakus et al.,
2009; Chaudhuri and Holbrook, 2001; Malär et al., 2011). Furthering
understanding of the process of developing the brand relationship and the
notion of brand equity will benefit from an empirically supported explanation
for these crucial brand concepts. Brands with symbolic benefits have the
potential to not only express brand-self associations but also to reinforce and
strengthen them, thus enhancing customers’ willingness to exert effort and
invest resources towards sustaining their relationship with the brand
(McCracken, 1990; Park et al., 2010). Brand–self connection is a core
component of attachment because it reflects the definition of attachment as
the bond connecting a person with the brand (Thomson et al., 2005). In this
study, emotional attachment is defined as a brand’s potential to elicit a
positive emotional response in the average consumer as a result of its use
(Thomson et al., 2005). Attachment is increasingly viewed in terms of the
aesthetic elements of brand symbolism and cultural significance, and the
emotions and resonance that these produce in the hearts and minds of
consumers (Malär et al., 2011). Furthermore, previous research proposes
that a valid measure of emotional attachment should predict consumer’s
commitment to a brand and their loyalty to that brand (Thomson et al., 2005).

Hence, consumers’ emotional attachment to a brand leads to their

commitment to the relationship with that particular brand. brand equity is
evident when certain outcomes that result from the marketing of a product or
service due to its brand name would not occur if the product or service did not
possess the name (Kotler and Armstrong, 2010). A number of factors
influence a company’s brand equity, including the firm’s strategic insights and
how effectively the firm implements its chosen strategy. This evolving
allocation of resources across marketing activities poses a problem with
regard to the return on marketing investments. To calculate the return on
marketing investments, companies could use sales or profits, but they also
might turn to several other equities (e.g., relational, brand, customer) (Seggie
et al., 2007). This debate raises the question of the most effective strategy for
mixing consumer promotions and brand-building activities.

In conclusion, brand equity has a profound impact on customers. It

influences their perceptions, loyalty, and purchasing decisions. Customers
and brands are any organization's two most significant intangible assets.
Ahead of duration, undertake studies in order to evaluate elements influencing
brand equity from the perspective of customers. Building and maintaining
strong brand equity should be a strategic priority for businesses seeking to
create a competitive advantage and long-term customer relationships. Brand
equity is the name given to the value of a company’s brand. It’s a measure of
overall consumer perceptions of any brand. Those perceptions get shaped by
the customer experience that a brand offers. If consumers get treated well,
they’ll develop favorable perceptions of a company. Thus, positive brand
equity gets generated. Poor customer experiences, meanwhile, create
unfavorable opinions of a business. That’s when negative brand equity results.
And once it has, it can be tough to turn around. Brand equity is essential for
the success of any modern organization. Create a favorable customer
impression of your company and success will come much more easily.
Customers will return for more and will spread the word about you. It's difficult
to recover from unfavorable brand equity. Companies with a bad reputation
must work twice as hard to win back consumers. The impact of brand equity
on customers can be significant and can influence their purchasing decisions,
loyalty, and overall satisfaction. Here are some insights about the impact of
brand equity on customers: Customer Perception and Trust: Brand equity
plays a crucial role in shaping customer perception and building trust. A
strong brand with positive brand equity is often perceived as reliable, credible,
and trustworthy. Customers are more likely to choose brands with a good
reputation and a history of delivering quality products or services. Brand
Loyalty: Brand equity fosters customer loyalty. When customers have a
positive experience with a brand, they develop an emotional connection and a
sense of loyalty towards it. They are more likely to become repeat customers
and recommend the brand to others. Brand equity helps in creating a loyal
customer base, which can lead to long-term profitability and sustainability.
Competitive Advantage: A strong brand equity provides a competitive
advantage in the market. Customers often perceive brands with high brand
equity as superior to their competitors. This perception can make customers
more willing to pay a premium price for products or services from a trusted
brand, even if similar alternatives are available at lower prices. Brand
Extensions and New Product Launches: Brand equity can facilitate successful
brand extensions and new product launches. When a brand has strong brand
equity, customers are more receptive to new offerings under the same brand
umbrella. They are more likely to try new products or services from a brand
they already trust, reducing the perceived risk associated with trying
something new. Enhanced Perceived Value: Brand equity enhances the
perceived value of a brand's products or services. Customers attribute
additional value to a brand with strong brand equity, considering factors
beyond the functional attributes of the product. This perceived value can
justify higher prices and lead to increased customer satisfaction. Customer
Advocacy and Word-of-Mouth: Positive brand equity encourages customer
advocacy and positive word-of-mouth. Satisfied customers are more likely to
share their positive experiences with others, both online and offline. This
word-of-mouth marketing can significantly impact a brand's reputation and
attract new customers. Resilience during Crisis: Brands with strong brand
equity tend to be more resilient during times of crisis or negative events.
Customers are more forgiving of occasional missteps or challenges faced by
trusted brands and are more likely to continue their support. Strong brand
equity can help a brand bounce back from negative situations more quickly. It
also provides strategic advantages such as facilitating market expansion,
competitive resilience, and customer co-creation. Building and leveraging
brand equity requires a holistic approach that considers both functional and
emotional aspects of the brand and consistently delivers value to customers.
Customer engagement in product development, idea generation, and
feedback procedures can be facilitated by brand equity. Brands may build
goods or experiences that better fulfill consumer wants and preferences by
incorporating customers in these activities, generating a sense of ownership
and loyalty among customers. Brand equity is tied to perceived value. Quality,
brand loyalty, and brand connotations are all important considerations, the link
between perceived worth and trademark. Brand equity linkages are
substantially weaker than brand loyalty and brand equity are related.
Understanding the influence of brand equity on new goods may help
businesses make strategic decisions regarding brand expansions and
enhance their success rates, as well as help marketers design culturally
relevant brand positioning and communication strategies. It's evident that
brand equity plays a crucial role in shaping their attitudes, behaviors, and
purchasing decisions. Customers often associate strong brand equity with
positive attributes such as quality, reliability, and trustworthiness. This
association influences their perception of value, leading to increased loyalty,
willingness to pay a premium, and a reduced perception of risk.

Furthermore, customers with a strong emotional connection to a brand

are more likely to become brand advocates, engaging in positive word-of-
mouth promotion and contributing to the brand's growth. Brand equity also
provides customers with a sense of community and belonging, fostering long-
term relationships and customer retention. Overall, brand equity significantly
impacts customers by shaping their perceptions, guiding their purchasing
decisions, and influencing their overall satisfaction and loyalty to a brand. As
such, businesses should strive to build and maintain strong brand equity to
positively influence customer attitudes and behaviors.
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