Established model
Brand equity
David A. Aaker · 1991
The value a name adds, held in awareness, associations, perceived quality and loyalty.
Its place in the frameworkBrand Core›Brand Value
What it does
It made the case that a brand is an asset with identifiable components rather than a vague good feeling, and that each component can be tracked over time. The consequence for management is that brand spending becomes investment or depreciation rather than a cost line, and can be argued about on those terms.
- Reach for it when
- When brand work has to be justified to people who read a balance sheet, and when deciding whether to extend a name to something new.
- Where it stops
- The components are measured by survey and do not aggregate into a number anyone would put in the accounts. It gives an argument, not a valuation.
David A. Aaker, Managing Brand Equity, Free Press, 1991.
Why it sits at Brand Value
What the brand is actually worth: whether people know it, what they associate with it, whether they come back, and what that is worth in money.
A model is only useful when you reach for it at the right moment. This one answers a question that arises here — so it is filed here, and nowhere else. These are the working areas it serves:
- AwarenessAaker’s brand equity model (1991), and the mental-availability work on category entry points that sharpened what awareness has to mean.
- AssociationsKeller’s customer-based brand equity: associations judged on strength, favourability and uniqueness.
- LoyaltyDick and Basu’s two-dimensional loyalty model, distinguishing repeat behaviour from relative attitude.
- ValuationISO 10668 on brand valuation, which requires the method, inputs and assumptions to be disclosed alongside the number.
What it touches elsewhere
Nothing in a business is decided on its own. A conclusion reached with this model at Brand Value lands in these other cores, whether or not anyone follows it there.
- Business CoreThe brand is an intangible asset and belongs on the schedule with a replacement cost.
- Data CoreAwareness and association tracking is a measurement programme and needs designing as one.
- Market CoreBrand measures are only interpretable against the same measures for competitors.
- Time CoreBrand value moves over years, which makes the measurement rhythm a deliberate choice.
Filed at the same place
These answer questions that arise at Brand Value too. Where they disagree with this one, the disagreement is the useful part.
- ISO 10668 brand valuationA required set of analyses — legal, behavioural and financial — before any monetary brand value is claimed.
Elsewhere in Brand Core
These are other people’s models, named here so you can go to the source and use them properly. The Omnigoal is not affiliated with their authors and is not endorsed by them; nothing of theirs is reproduced here — no canvas, no diagram, no wording. Each is described in our own words, with the originator credited, because the framework is a place to put thinking, not a replacement for the people who did it. Model names and trademarks belong to their respective owners and are used here only to refer to the work itself.
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