Brand Equity & Coca-Cola – Is it the Real Thing?


On a basic level, brand equity can be defined as thus:

‘The relative power of a brand to influence people’s decisions to buy or not buy its product above others.’

Or, to put it more specifically:

“The tangible and intangible value that a brand provides positively or negatively to an organization, its products, its services, and its bottom-line derived from consumer knowledge, perceptions, and experiences with the brand.” — Susan Gunelius

Always On Your Mind

There is a particularly fascinating feature of some of the very top brands. It’s what the people who give such things names call ‘Top of Mind Status’. Or what I like to call ‘Brand-led Product Mindspace Monopoly’. Catchy isn’t it.

Say you want a cola drink. You don’t say “I really fancy a Cola Drink right now”. You say “I’d like a Coke”. Massive Brand Equity. In fact, how many times have you heard back the phrase “Is Pepsi OK?” in your life? There you go. Exactly my point.

Transport back to 1988. Are you listening to the Dirty Dancing soundtrack on your portable stereo cassette player, or you having the time of your life with your ‘Walkman’? Huge 80’s Brand Equity!

What’s that you say? You want to create some duplicates of your latest typed masterpiece? “I’m just heading over to the Xerographic Office Photocopier…”

Consider “Arm & Hammer” baking soda, “Scotch” cellophane tape, “Jell-O” gelatin, and “Morton” salt. OK, you get the general idea. The list goes on.

Having such a dominant brand that it eclipses any other in general conversation and becomes synonymous with that particular product provides the strongest possible competitive advantage, and is the holy grail of brand equity. No other brand will be considered in the vast majority of purchase situations.

In fact, by that point, it’s not just about the product any more. It’s about stories, memories, associations, and human connections (although of course, these connections would have been very carefully and deliberately engineered by talented marketers over many years and countless board meetings).

This is something that Coca-Cola have been the masters of for over 100 years.

Even if you duplicated the entire Coca-Cola production process and produced a drink that tastes identical, (or better for that matter!), you could not duplicate the memories people have of the brand, and therefore their connection to it.

The secret recipe of Coca-Cola may no longer be secret. It may not even be unique any more. But the memories associated with the brand are, and that is what makes the brand so much more valuable than other colas. Tangible and intangible assets combine to create financial brand equity.

This equity is derived from people’s willingness to pay a premium for the brand and an unwillingness to accept substitutes. So in this case, if the Coca-cola is expensive than Pepsi or other brand colas, would you still buy Coca-Cola?


4 thoughts on “Brand Equity & Coca-Cola – Is it the Real Thing?

  1. Interesting point – I dare say yes there would be those who would still buy Coke because that is their drink of preference. It would likely depend on how much more expensive though as I expect everyone would have a point at which they would think about the cheaper products – I know I would and do with a number of brands when the price suddenly goes up. But the name Coke is almost ubiquitously associated with cola drinks – one tends to buy a ‘rum and coke’ not a ‘rum and pepsi’ at the bar. My teenagers prefer Coke – they never ask for Pepsi, and if someone was to say “cola” I would probably automatically associate it with “Coke”. I guess Coca-cola have been very clever in associating and blending the brand with so many aspects of our lives we take the brand almost for granted.


  2. In my opinion, I would prefer to buy cheaper Pepsi, because I pay more attention on the taste in the food. If the two brands have the same taste, I would not hesitate to choose cost-effective one. Although Coca-Cola is more historic , but it is only a one-time drink. People will not save its container, so I think the value of the brand is more reflected in the taste and quality of cola than than childhood memories.


  3. Coca-cola has created such a brand power in itself that even if some drink stands to compete against it, the market power of coca cola an pepsi destroys the new brand or acquires the new brand under its flag and remains dominant, it was not just the brand that is making them gain the market power its the strategies used by the management that is keeping the brand float. One such example is in the last decade people were becoming more health conscios and were switching from sugar loaded drinks such as coke and pepsi to juices some companies were taking their market share, coke and pepsi acquired many such companies and/or started new ventures to enter the new market of juices and water, such as tropicana, even water such as kinley and aquafina etc.


  4. its amazing how a combination of colored water, sugar and soda can be marketed as the ultimate experience of joy and good times. i agree with you that the secrete of cola is no more a secrete, Pepsi cola has managed to show that it tests better ! , remember the taste challenge which took place in the 70s and 80s , it shocked many people how Pepsi cola taste better then coca cola, that allowed Pepsi to take some good portion of market share. lesson learned from that is it doesn’t matter whether it taste better but the perception and experiences associated with the brand. that’s what we actually pay for.


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