Imagine entering a grocery store, turning down the milk aisle, and seeing more than 10 nonfat varieties staring back at you. Without a second of thought, you choose one brand over another, all because of that brand’s equity.
“In a general sense, brand equity means the value of your brand,” Tom Brown, senior consultant at Power Decisions Group, a San Francisco-based marketing and branding company. “It answers the question of how you are doing over your competitors.”
How does a small business measure its brand equity?
Look at referrals.
“Pay attention to how much of your business is being sourced from your reputation, from your referrals,” said Susan Betts, senior strategy director at FutureBrand North America, a New York-based brand consulting company. “Think about how long your key customers have been with you.”
“Small businesses can do a lot of customer research to measure their brand’s equity,” said Daniel Rosentreter, chief strategy officer with FutureBrand. “Doing a survey of your customer base will give you a very hard-core measure. Talk to your customers and ask them how they feel about working with you.
“A lot of small business owners forget to ask people about their business and what they could be doing better. The more information you can get, the better for your business.”
Surveys don’t have to be formally sent out to customers. Instead, small business owners can use social media sites to promote their brand, increase business awareness and gage customer satisfaction.
What if a small business receives a scathing online review?
“If you get a bad comment on a site like Yelp, your brand equity can tank dramatically,” Rosentreter said. “When you see a comment that you don’t agree with, respond. Comment on their comments to deflect some of the negativity.
How can a small business build brand equity?
Understand your customers.
“The most important thing for businesses to do is to understand their customers, what they want and what they are provided,” said James Bell, senior partner in brand strategy for Lippincott, a New York-based branding company. “Understand your competition, understand what people desire and understand where the demand is and where you need to be.”
Get out there.
“Small businesses can communicate their brand in a variety of ways,” said Rosentreter. “Put an ad in the local newspaper, make a website that talks about it. Schedule an event that reinforces your story.
“A lot of small businesses don’t think about doing those things, but all of them can create brand equity. Those are the things that help with word of mouth and help your business grow.”
“Great brands create a consistent experience for customers time after time,” Brown said. “Make sure your customers are constantly getting what they expect.”
“Make sure your brand makes a connection on a person-to-person level that customers relate to and remember,” Brown said. “Brand advocates tend to appear as the connection grows.”
“Understand what you are really good at as a business,” Rosentreter said. “What can you deliver that is better than anyone else out there? What is unique about your small business? What is your differentiator?
Katie Morell is a Chicago-based freelance writer specializing in small business concerns.