How brand loyalty has increased in recent times
Brand is defined as a tool for identification and differentiation of a product along with customer loyalty and trust. The notion that branding adds value to an organization through the establishment of brand equity or brand loyalty has been added to the idea of a brand as a representation of values. Earlier, brand loyal was defined or measured on frequent purchase behaviour of the consumers. Therefore, a true brand loyalty is defines as a repeat purchase behaviour along with a personal relationship with the brand.
For many consumer-driven organizations, brand loyalty has surfaced as a key marketing strategy. Various key factors such as sensitivity towards price, positive personal feedback from existing customers, quality of products and servicing are driving forces in making any business successful.
Importance of brands
“A brand is said to be “the living relationship between a person and a product or organization. It exists in the mind, the place where the tangibles and intangibles meet. A firm’s ability to create a prominent brand enables it to attract customers and protect itself from competition. As a result, brands are the most valuable resource that many companies possess, and the brand equity that accompanies with them is usually a consequence of years of development.
Increasing public awareness about brands
Value of brand equity in brand development in a market for new and relevantly less popular brands is well understood. If one brand name on a product reflects a quality signal, the addition of a second brand name on the product should reflect a signal that is at least as strong as, if not stronger than, the signal sent out by the single brand name. People have become brand conscious these days. Most of the credit for goes to social media where everyone is busy flaunting the sneakers they are wearing or even coffee they are drinking. This has significantly increased the awareness about brands.
Brand equity is the extra value that a product receives because of marketing expenditure and effort. This increasingly important idea has been linked to price premiums and market share. Brand equity is divided into two categories: brand specific associations (features, traits, or advantages that customers associate with the brand) and generic or more holistic perceptions of the brand. It should be evaluated through the lens of informational economics’ signalling theory. The imperfect and asymmetrical informational structure of the market is considered by the informational economic approach. It emphasizes credibility as the primary driver of consumer-based brand equity, which is determined endogenously through dynamic interactions between enterprises and consumers.