What does brand equity refer to?

Brand equity refers to the value that a well-known brand brings to a product or service. This value is often derived from consumer perceptions, associations, and loyalty tied to the brand. When a brand has strong equity, it can command higher prices, foster customer loyalty, and gain competitive advantages in the marketplace. A well-established brand can leverage its reputation to enhance the perceived value of its products, differentiating them from competitors, even if the actual product features are similar.

The other options touch on various aspects related to brands and sales but do not accurately define brand equity. Sales revenue from top products, market share, and customer retention linked to loyalty programs are metrics that can relate to a brand's performance but do not encapsulate the concept of brand equity itself. Brand equity is specifically about the added value provided by the brand name and reputation, which is crucial for forming consumer relationships and driving long-term profitability.