What is Customer-Based Brand Equity?

In an oversaturated market where countless brands compete for attention, establishing a significant presence that resonates with consumers is crucial. Enter the concept of customer-based brand equity, a term music to the ears of marketing professionals, business owners, brand strategists, and B2B decision makers.

But what exactly is customer-based brand equity, and why does it matter? Join us as we unpack the essence of customer-based brand equity and explore how it can be a game-changer for your brand’s long-term prosperity.

What is CBBE?

Customer-based brand equity (CCBE) refers to the differential effect that brand knowledge has on consumer response to the marketing of that brand. A brand with strong CBBE resonates more profoundly with consumers, influencing their choices and fostering loyalty. It’s the hidden ace in a marketer’s deck that can significantly amplify a company’s success in the marketplace.

Understanding Customer-Based Brand Equity

One of the seminal frameworks for understanding customer-based brand equity is the Keller Model, proposed by Kevin Lane Keller in his influential text “Strategic Brand Management”. This model breaks down CBBE into four key components:

  1. Brand Awareness: Recognition and recall by the customers.
  2. Brand Associations: The attributes, benefits, and attitudes related to the brand that customers hold.
  3. Perceived Quality: The customers’ perception of the brand’s quality.
  4. Brand Loyalty: The degree of affinity and commitment customers have towards the brand.

These pillars collectively contribute to a brand’s standing in a consumer’s mind and the marketplace.

Benefits of Customer-Based Brand Equity

The merits of cultivating strong customer-based brand equity are manifold. Brands that achieve high CBBE enjoy:

  • Enhanced customer loyalty as consumers become committed to the brand, often in spite of competitive offerings.
  • A surge in brand value, which often translates into increased revenue and profitability.
  • A robust competitive advantage as the brand becomes differentiated and preferred in the marketplace.

Building Customer-Based Brand Equity

Building a compelling CBBE involves:

  • Establishing a strong brand identity that clearly communicates your brand’s purpose, promise, and personality.
  • Delivering superior customer experiences at every touchpoint to reinforce the positive aspects of the brand.
  • Cultivating brand loyalty through consistent, value-driven engagement with customers.

Consistency and strategic innovation are the keys to cementing a powerful brand equity that thrives on customer perception and experience.

Measuring Customer-Based Brand Equity

But how do you know if your brand equity is strong? Measuring CBBE can involve:

  • Surveys and customer feedback to gauge perceptions and attitudes towards your brand.
  • Brand equity metrics such as social media sentiment analysis, brand search volume, or customer lifetime value.

Data-driven insights will enable you to understand where your brand stands in terms of customer-based brand equity and what steps you may need to take to enhance it.

Case Studies

Let’s reflect on some successful brands:

Brand Equity Case Study #1: Apple

Apple is a brand with incredibly strong brand equity. According to Statista, the value of the Apple brand is estimated to be around 300 billion US dollars. Regardless of personal opinions about the company, it is undeniable that Apple is known for its excellent build quality and customer offerings. How did they achieve this? Through years of perfecting their products, learning from competitors, and improving upon existing ideas.

It’s worth mentioning that Apple wasn’t always at the top. They faced challenges with products like the Lisa tablet, which was ahead of its time but had drawbacks. However, the company managed to bounce back and become stronger than ever.

Let’s take the example of the smartphone market. Apple wasn’t the first to release a touchscreen smartphone, but they introduced the iPhone, which became the global market leader. They combined the features people loved about their breakthrough product, the iPod, with a slim and attractive design, a large tiltable screen, and a top-notch camera.

Even today, Apple continues to innovate in the smartphone market. They may not be the first to try new things, but they believe in observing the successes and failures of others before creating their own version. This approach helps them maintain their reputation for delivering high-quality products.

For Apple, brand equity is built on offering customers reliable and user-friendly products. Their clean and simple designs, coupled with unique identifiers, make their products desirable and give users a sense of social capital. Apple understands that maintaining high product quality is key to preserving brand equity and ensuring customer satisfaction.

Brand Equity Case Study #2: Dollar Shave Club

There are other smaller companies that have achieved remarkable brand equity through similar means as Apple, but without the same massive scale. One such company is Dollar Shave Club, a four-year-old company renowned for its mail-order sales of razors and shaving accessories. But what makes them truly stand out?

Well, picture this: they offered to send monthly packs directly to customers’ doors for just $1 a month. As their CEO humorously put it in a promotional video, “Do you really want to shell out $20 per month for branded razors, when 19 of those dollars go straight to Roger Federer?” This witty and lighthearted approach struck a chord with their audience and set them apart from the straight-faced tone of other razor manufacturers’ ad campaigns.

One thing that really sets Dollar Shave Club apart is their amazing customer service. They always make sure your packages arrive on time, and sometimes they even throw in special gifts and bonuses. And the best part is, you can cancel anytime without any pesky penalty fees. But what really impressed me is when a US soldier in Afghanistan requested an order for his company, Dollar Shave Club didn’t hesitate to send the packages for free. They even included a personal note from the CEO. How cool is that?

While some may see these actions as marketing ploys, they stem from the company’s commitment to being honest with customers, avoiding tricks, and charging only what is necessary. In simple terms, Dollar Shave Club understands and caters to Gen-Z consumers.

As part of their customer care program, every Dollar Shave Club subscriber receives a monthly magazine in their package. This further strengthens brand loyalty as consumers trust that whatever the company does next, based on their past performance, will be beneficial to them.

For anyone interested in brand building, Dollar Shave Club serves as an excellent case study on how to make consumers care about what you’re doing.

Such stories serve as valuable lessons on the effectiveness of prioritizing customer-based brand equity in branding strategy.


Ultimately, the pursuit of a strong customer-based brand equity goes beyond mere recognition. It’s about building genuine connections with consumers that withstand market shifts and transformations. It’s a long-term investment that reaps rewards in customer loyalty, market share, and brand resilience.

Remember, the value of your brand lies not just in the products or services you offer but in the hearts and minds of your customers. Customer-based brand equity is not just a buzzword; it’s a pivotal aspect of any thriving business that warrants continual focus and nurturing. Aim to build and sustain this equity, and you pave the way for lasting business success.

Build your brand on a firm foundation of customer-based brand equity with our comprehensive customer brand strategy. Explore the nuances of brand equity building, and craft a brand that not only exists but thrives and resonates deeply with your consumers.