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Brands are interesting and important - but at times hard to measure. Therefore there is no one truth to how one should measure brand equity. First of all, there's two types of "brand equity" - straight up monetary value and intangible brand value that translates to monetary value later when customers fall in love with the brand.
I think one should start with the intangible part, because one must know the current state of the brand before making financial projections about the current and potential monetary value. One tried and true (but not the only) method of estimating brand equity is to measure three KPIs and form a composite KPI by multiplying them. The three KPIs are
- Image strength: do customers know the brand (e.g. awareness) and how strongly they link positive attributes/brand's core attributes to it (e.g.55% of consumers say this brand is "best quality")
- Differentiation: does the brand have a unique position in the market compared to competition or is it the same as everyone else (measured by e.g. attribute-based positioning analysis)
- Preference: is the brand a preferred choice for consumers compared to competition (e.g.30% of consumers say this brand is their favorite, while competitors get15-25% ratings)
All of the above mentioned can be measured by doing some consumer research - be sure to include as many relevant competitors as needed (without making the questionnaire too long). When the KPIs and the composite KPI are ready, you have the baseline. It should be compared to competitors and your own brand's measurement results you do next year - be sure to monitor the trend, or you will not know if your corrective actions have worked.
The financial analysis of brand equity in its simplest form is measuring the profit of your business with the brand vs. without the brand. Is it worth the cost of building and maintaining the brand? More complex financial analyses can also be made, e.g. by statistically modeling the effect of positive brand attributes to customer's willingness to buy. Regression analysis and principal component analysis (PCA) can be used to identify e.g. which attributes, if enhanced, will improve willingness to buy (you should have the research data for the analysis if you have properly designed the study for the previous three KPIs). This is statistics, and should be treated as such. It gives great indication of what to do, but the results must always be carefully discussed from business point of view - what is possible and what is the cost of changing a brand's image.
I hope this post gives you some ideas :)
Performance and equity are two different metrics, and there is no one way to measure any of them. For example, brand equity can be measured by identifying how aware your customers and non-customers of your brand, if they are willing to recommend it, and pay a price premium for it. Performance can be measures through sales, market share, penetration, distribution, etc...
If you need more information about this, you can contact; I work at Nielsen, a global measurement company that helps companies like your measure their performance and brand equity.
There are various ways and metrics to measure brand performance. While many brands have perfected their own measuring tools through analytics, the best way to measure the same is through monitoring of sales. in case of a product or walk-ins/registrations in case of a service.
Monitoring sales figures pre and post a campaign will reveal the brand performance. and equity can be gauged from the profitability margins of the same.
