top of page
  • Writer's pictureBRANDS & U

Conceptualising, measuring and managing customer based brand equity in the context of food businesse

An attempt to define the relationship between customers and brands produced the term “brand equity” in the marketing literature (Wood, 2000). Over the past twenty years a lot of research was conducted that addressed the various facets of brand equity. It is generally accepted as a critical success factor to differentiate various companies from their competitors in the market. Brands with high levels of equity are associated with outstanding performance including sustained price premiums, inelastic price sensitivity, high market shares, and successful expansion into new businesses, competitive cost structures and high profitability all contributing to companies’ competitive advantage (Keller and Lehmann 2003; Vazquez et al. 2002 ).For firms, growing brand equity is a key objective to be achieved by gaining more favourable associations and feelings of target consumers (Falkenberg 1996). There have been two motives in general behind studying brand equity. One is the financial based motive for accounting purposes or for merger, acquisition or divestiture purposes. And the second reason for studying brand equity arises from a strategy based motivation to improve marketing productivity. Taking into account higher costs, greater competition and flattening demands in many markets firms are wanting to increase the efficiency of their marketing expenses.

Brand Knowledge

A brand can be defined as "a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors" (Kotler 1991; p. 442). Its important to understand the content and structure of brand knowledge is important because they influence what comes to mind when a consumer thinks about a brand-for example, in response to marketing activity for that brand. The financial meaning from the perspective of the value of the brand to the firm and customer-based meaning from the perspective of the value of the brand to the customer which both come from a marketing decision-making context (Kim, and An 2003).

The concept of Brand equity

During quite a number of years in the past, brand equity has become one of the major areas of attention to managers and marketing researchers owing to its major role as a significant intangible firm asset.

In the 1980s brand equity ,was seen from the financial perspective, and was viewed as a method that gave managers guidance in understanding brand enhancement. Supporters of the financial perspective (FBBE) define brand equity as the “total value of a brand which is a separable asset – when it is sold or included in a balance sheet” (Atilgan et al., 2005). Being able to estimate the financial value for a brand is certainly useful but at the same time it does not help the marketers to understand the process of brand building equity.

Extant literature on brand equity has focused on the perspective of cognitive psychology (Christodoulides and de Chernatony, 2010) known as consumer-based brand equity(CBBE). It can be best described as a construct caused by brand related associations in which the brand related consortiums are concentrated. In order to be able to make recommendations to managers on how to manage their brand equity or study the nomological network of its constituent components, we need to generate a better understanding of the composition of brand equity in disparate cultural contexts and distinct product categories (Christodoulides at el, 2015).

The food industry is an old industry. Some companies, such as sake breweries and wineries, have been in business for 400 years. Therefore, the food industry has experienced fewer innovation activities historically. Much of the previous literature argues that innovation activities are not as active in the food manufacturing industry as in other industries. In the fast food industry, the dimensions of consumer-based brand equity are decomposed into brand awareness, brand familiarity, perceived quality, brand image, brand trust and attitudinal brand loyalty, demonstrated three-level hierarchical chain.

The first dimension that distinguishes brand knowledge is brand awareness. Brand awareness plays a major role in consumer decision making in some crucial ways. Like it is very important for the customers to think of the brand when they are thinking of the product. The elements of brand equity such as brand awareness on food businesses can be nourished with the help of various social media platforms. In the food industry the competition is huge and having an enormous number of companies selling almost the same product makes it even more difficult. For example, both Pizza Hut and Dominos sell pizza. But they have different target audiences depending on few parameters and both are flourishing successfully by keeping the character of their brands alive and authentic. Raising the brand awareness raises the likelihood that the brand will be a member of the consideration set.

Although food product value and food safety is widely acknowledged as a critical concern by consumers, little empirical evidence exists regarding how food product value is created and how product risk decreases as a result of service-brand equity.


bottom of page