I think of this as a demand and supply thing. Brand equity is really on the supply side, in the sense that, who are you as a brand as a brand? How do you represent yourself? How do you generate customer preference? How are you perceived relative to the competition? That's all supply side stuff. As far as the data for that, some people just use, awareness levels or some other attitudinal variable. But the professionals use rather sophisticated methods that are being made available by companies like Interbrand, for example. So, at least for larger companies, those brand equity numbers are published. Now customer equity, you can calculate yourself. You do exactly as I just did, how many customers do you have, how long do they tend to stay. That generates the long-term value and you apply discount rate. And then what is your acquisition rate of new customers? The sum of the two provides CLV.
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I this as a demand and supply
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I think of this as a demand and supply thing. Brand equity is really on the supply side, in the sense that, who are you as a brand as a brand? How do you represent yourself? How do you generate customer preference? How are you perceived relative to the competition? That's all supply side stuff. As far as the data for that, some people just use, awareness levels or some other attitudinal variable. But the professionals use rather sophisticated methods that are being made available by companies like Interbrand, for example. So, at least for larger companies, those brand equity numbers are published. Now customer equity, you can calculate yourself. You do exactly as I just did, how many customers do you have, how long do they tend to stay. That generates the long-term value and you apply discount rate. And then what is your acquisition rate of new customers? The sum of the two provides CLV.
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