It is one thing to have a brand, and it is another one to have a strong brand with good brand equity or worth. It takes a lot of investment to build a brand to get to a level where it is on top of people’s minds . Furthermore, to have it command a considerable market share, especially in different markets, as Coca-Cola has achieved. The value of a company increases due to a brand’s strength and enhances motivation among the employees. Also, it gives employees a sense of belonging.
The bar leverages the strong Coca-Cola brand to sell branded merchandise and offer a paid-for sampling of international flavors from its various markets, thus making some good cash.
Here are some of the financial benefits of having strong brands:
Allow Price Flexibility
When your brand has a good command in the market, you can increase prices without expecting a tremendous negative response like a drop in sales. Although hiking prices is not a sustainable way to increase your revenue, as pushing higher volumes of sales can work, it can be used in some cases. Due to customers’ excellent brand loyalty, thus no fear of them switching to rivals, businesses with strong brands can generate more revenue through the price increase.
Increased Word of Mouth Saving on Ads
A strong brand enjoys excellent publicity due to the word of mouth advertising from loyal customers. That way, the company can save on advertisement or have better returns from their marketing efforts because word of mouth from the customers will complement them. Because prospective customers are more likely to listen to their friends, relatives, and other people they know, word of mouth works well for the brand.
More Revenue from Other Associated Brands
Companies with reputable brands can leverage brand recognition to introduce new brands in the market. They can ride on their superior products’ great names to make more sales and get a reasonable market share. For example, when Coca-Cola introduces a product, the loyal customers are eager to test it because they already know and highly regard the original brand.
This enables most of the new products to do well in the market. Using the same idea of optimizing the strong brand, the company can also introduce a new product line and still manage to get a good customer response.