Brand Equity - Intangible Element - Assignment Example

Brand Equity - Intangible Element For the company, the most important thing is how the brand produced will reach the market and how will the customers feel about the brand (Lane, Vicki, and Robert 73). This is one of the aspects that see the company performing well in a competitive world market. The company has to make sure that its brands reach the market and the target customers accept it. Reaching the market is not the absolute thing to be checked on. The company also has to consider the feelings of the customers towards the goods and services provided. Through this, the company will gain maximum brand equity (Lane and Jacobson 68-77). Brand equity is a term that denotes the value that the company derives from having a good brand. It is the way the company will generate money from their well-known brand by the customers. This paper cut across brand equity of Coca-Cola Company. Intangible Element For every firm, the main thing that should be looked at is the market position of the brand or the product. The brand name used should me one accepted by the customers in a bigger market. For Coca-Cola brands, the brand name has scoped the company a great portion of the market in the world market. It has been in the top ten companies that are producing and marketing soft drinks to the world market. Using its brand name, Coca-Cola has been accepted in the world market. In fact, anywhere your mention the word Coca-Cola, everyone knows what you are talking about. With having a good brand, Coca-Cola Company has been favored by the customers over their competitors as the consumer take their products to be superior to others. With this, Coca-Cola Company has been increasing (expanding) its market size. In addition, the consumers are even willing to pay for the brand name. The premium paid by the consumers for the brand name is called brand premium. This is a confirmation that the Coca-Cola consumers are willing to pay for the brand regardless of the cost. This has helped the company to be very much competitive among other soft drink dealers like Pepsi One and Mirandas The above statement is confirmations that brand affect the market of any product. In addition, brand play with the psychology of the consumers as they will be willing to buy the product as far as the brand name is known. Once the brand takes its position in the market, the brand success will be seen from the way the customers value it. The customers will be aware and be strongly associated with the brand. It will be accruing in their mind that the company has the best product. The attributes associated with Coca-Cola brand are imagery by the consumers, self-enhancement, and brand name heritage. Furthermore, brand increases the longevity of the brand in the market. In fact, the Coca-Cola predicts to be in the market for the next couple of decades without predicting their extinction. To support this, the companies argue that they had been the market leader for a long period of time, and they will remain operating in that position for long. With a good brand that is accepted by the customer, the Coca-Cola has become competitive hence able to remain in the market without being shaken by any other soft drink company. Social Responsibility Creating brand is one of the pillars of a successful company. Coca-Cola has been using its brand as one of the supportive measures so that it can be more competitive in the world market. With its brand name, the consumers believe that all what is produced has a good value to the society (Klein and Dawar 168). For example, the Coca-Cola brand has created some trust in the customer’s mind that, what is producing or all of their brands are of good quality. Through this, the customers have some trust in the Coca-Cola product. In fact, the company follows the rule of Health, Safety and Environment (HSE), which is one of the requirements of ISO 9001 (ISO 611). With this, the Coca-Cola Company’s brands are taken to be of a higher value. The customers believe that the brand being produced by Coca-Cola is of good quality and healthy to drink (Klein and Dawar 176). In addition, Coca-Cola has strategies to keep the environment clean. With this, the brand creates a mind set on the customers’ mind that the brand produced has good social aspects. They believe that what Coca-Cola is producing is good and of good social responsibility (Klein and Dawar 82). This is a requirement of HSE issues. Ethics is another social aspect that the Coca-Cola Company takes into account. With good brands, the soft drinkers believe that all what is produced by the Coca-Cola is of good quality and follows human ethics. The highly favored brand name creates something in the mind of the consumers that the brand is widely accepted because is of good quality and is following the world ethics measure (Klein 109-115). The Coca-Cola Company has used this stronghold to make the customers believe that what they are producing is of the beast quality, and that is why its product is accepted worldwide. Financial Value The Brand is an essential thing in a company's financial stability. In supportive with this, brands help the company in its profit maximization strategy (Abratt 312). With the customers willing to pay a premium for the brand name, the company gain from this premium. In fact, Coca-Cola usually extends the cost of creating the brand to its customer who even don’t feel the cost. They always find themselves paying for the brand. According to the international financial report system, the brand financial value must be well reported and be quantified. This will help the company during sales and brand valuation. The Coca-Cola brand financial valuation helps the customers and the marketers to evaluate any changes in the brand. The company's management are guided by the value in calculating the return on investment of the firm (Robert 243). The market managers in the company usually use three methods to measure the brands financial value. One of them is the notion of the brand that is taken as a set of large cognitive relationship (Keller 202). The second one is the revenue or price premium paid by the consumers for the brand. It is compared to the benchmark of the competitors. The last perspective is the stock premium. This is a price paid for the stock of the company. The effect of brand for Coca-Cola can be shown using the following pictorial bar graph that compares the value of different multinational companies in the basis of their financial value. It shows how the Coca-Cola brand is highly valued in the world market (Raggio, Randle and Leone 207). Source: Millward Brown Optimor, 2007 Conclusion The Brand is an important aspect of any company that is exposed to the world competitive market. With a good brand, like that of Coca-Cola, the firm will always remain in the market and do not feel the effect of competition. The reason as to why this happen be that the brand will remain to have a competitive advantage as compared to others. In addition, Coca-Cola through its brand has created social responsibility through the production of quality products. Lastly, the brand value has an effect on the financial and stock value of the company. This is the reason why Coca-Cola has remained solvent and as the soft drink world leading marketer. Works Cited Bendixen, Mike, Kalala A. Bukasa, and Russell Abratt. "Brand equity in the business-to-business market." Industrial Marketing Management 33.5, 2004: 371-380. Lane, Vicki, and Robert Jacobson. "Stock market reactions to brand extension announcements: The effects of brand attitude and familiarity." The Journal of Marketing, 1995: 63-77. Klein, Jill, and Niraj Dawar. "Corporate social responsibility and consumers' attributions and brand evaluations in a product harm crisis." International Journal of research in Marketing 21.3, 2004: 203-217. Raggio, Randle D., and Robert P. Leone. "Drivers of brand value, estimation of the brand value in Management 17.1,2009: 1-5. Steiner, Robert L. "Intrabrand competition-stepchild of antitrust." Antitrust Bull. 36, 1991: 155. Read More