Brand Equity

The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. Companies can create brand equity for their products by making them memorable, easily recognizable and superior in quality and reliability. Mass marketing campaigns can also help to create brand equity. If consumers are willing to pay more for a generic product than for a branded one, however, the brand is said to have negative brand equity. This might happen if a company had a major product recall or caused a widely publicized environmental disaster...


The purpose of brand equity is to measure the value of a brand. 
A brand encompasses the name, logo, image, and perceptions that identify a product, service, or provider in the minds of customers. It takes shape in advertising, packaging, and other marketing communications, and becomes a focus of the relationship with consumers. In time, a brand comes to embody a promise about the goods it identifies—a promise about quality, performance, or other dimensions of value, which can influence consumers' choices among competing products. When consumers trust a brand and find it relevant, they may select the offerings associated with that brand over those of competitors, even at a premium price. When a brand's promise extends beyond a particular product, its owner may leverage it to enter new markets. For all these reasons, a brand can hold tremendous value, known as brand equity


Strong brand equity  provides the following benefits:

1. Facilitates a more predictable income stream.
2. Increase cash inflow.
3. Brand equity is an asset that can be sol or leased.

Indian FMCG Industry.....

The Rs.85,000 crore FMCG market in India is growing at a fast pace despite of the economic downtrend. The increasing disposable income and improved standard of living in most tier II and tire III cities are spearheading the FMCG growth across the nation. The changing profile and mind set of the consumers has shifted the thought to “Value for Money” from “Money for Value”.

Over the years companies like HUL, ITC and Dabur have improved performance with innovation and strong distribution channels. Their key categories have strengthened their presence and out performed peers in the FMCG sector. On the contrary, Colgate Palmolive and Britannia Industries are strong in single product category i.e. tooth pastes and Biscuits. In addition companies have been successful in reviving their presence in the semi-urban and rural markets.

FMCG Sector is currently going through a drastic change in its approach and the market it is catering, the demand of the customers is changing and so  the need arise for a change in the product or the way it is marketed.

One More interesting trend to note is in the advertising because we all know a major success reason of any F.M.C.G. product is its advertising. In advertising on one hand we can see that the market of Television with youth is decreasing because of Fast lifestyle and availability of most of the interactive media on Internet. So there is an emerging trend whereby F.M.C.G. players have increased their focus on online advertising which is expected to grow at 30% a year. While on the other hand the inclusion of Television is increasing with the fall in the Television prices and comparative increase in the Purchasing power but still to attract that segment advertising solely on T.V. would be an expensive proposition and its reach would also be limited to the upper strata rural people. So, here companies are employing the rural media to increase their product awareness by employing the rickshaw, auto, Walls of houses and shops banner which have a higher reach and these mediums in village do attract attraction.