The Fragile Nature of Brand Equity

Brand Equity is a House of CardsAs marketers and business leaders, we spend years, if not a lifetime, cultivating our brands. They define who we are and generate an annuity of business and goodwill for decades. That annuity helps grow the value our brand equity. Our customers, by purchase and by proxy, derive benefit from our brands. Go walk into a Starbucks. Who is there? Why are they there? What are they drinking? What computers are they using? What are they wearing? What are they reading? It’s all brand. Marketing 101.

So if brand is so important, why are we seeing some of the strongest ones tumble? Because brands are incredibly fragile. Just look at Tiger Woods and Toyota as recent examples. The fallout is not just to the brand-owners but to those who derive ancillary benefit. Tiger Woods’ sponsors are leaving because the brand actually has negative value and it impacts them. Personally, I love watching Tiger play and I enjoy hopping into my Toyota SUV and driving through the New England snow. I’m disheartened by both recent events.

The brand equity ascent is slow and arduous; the descent is fast and dangerous. Paraphrasing a former business partner of mine:

If you’re not careful, you can go from a hero to a has-been in heartbeat.

How true. Is it more challenging these days to protect a brand? Absolutely. The velocity of communications and the acceleration effects of social media leave little time to react.  And remember: bad news is like gasoline and good news is like water – all it takes is one strike of a match.

Is there a cure? Not entirely, but integrity sure goes a long way. Not just integrity from the start (Tiger Woods) but also integrity when dealing with and addressing problems as they arise (Toyota). We’ll see how they (and many others) try to regain their brand equity. Much, however, depends on whether those of us who benefit will remain loyal.

Rob Ciampa


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