Brands can command a premium.

In other words, take Pierre Cardin as an analogy: if you compare the same clothes, the same suit, and an unbranded suit with Pierre Cardin, you may be willing to spend thousands more to buy Pierre Cardin, but in fact

Wearing it on the body is similar to something without a brand, but there is an emotional value in it, which is determined by the consumer psychology.

Because of this consumer psychology, you must shape your brand into a higher image than other brands in the minds of consumers. With this image, the premium of the brand becomes natural.

This is brand premium.

Do brand added value and brand premium mean the same thing or are they different?

What's the difference?

5 points are different. Added value: It is extended value. Brand added value is the intangible value that the brand adds to the tangible value of the product through various methods.

Intangible value and tangible value exist simultaneously.

It is the spiritual enjoyment of consumers based on the material functions of the product.

For example: spiritual satisfaction, high-quality services, and guidance of consumer behavior.

Premium: The amount that exceeds value!

The same product of a brand can be sold at a higher price than competing brands, which is called the brand premium.

What does premium mean in the market? A premium is when the actual amount paid exceeds the nominal or face value of the security or stock.

In terms of funds, it specifically refers to the trading price of closed-end funds being higher than the value of the net assets of the fund units.

The meaning of brand premium is the added value of the brand.

A brand's ability to sell the same product at a higher price than competing brands is called the brand's premium capability.

David Egger's brand equity theory believes that brand equity includes brand awareness, quality recognition, brand association, brand loyalty and brand legal assets.

Brand premium ability is not included. Weng Xiangdong, a well-known brand strategy expert, believes that the reason why brands can become assets (some companies include brand assets on their balance sheets) is simply because the brand can support the company's profits. Brand premium ability is what companies gain.

A powerful weapon for higher selling prices, higher profit margins, and better profits, so brand premium capabilities should be included in brand assets.

Indicators such as popularity, quality recognition, and brand association in brand equity ultimately make the brand profitable by increasing loyalty and premium capabilities.

An ordinary shirt may only cost 40 yuan. If this shirt is labeled with Prada, Ermenegildo Zegna, Dunhill and other clothing brands, the price will be more than 400 yuan (this is still a conservative estimate). The huge transformation from ugly duckling to white swan is taking place.

It is a miraculous workmanship of brand premium.

China is known as the world's manufacturing factory. With its cheap and skilled labor force, it has produced many cheap products. For a time, products marked "made in china" were all over the world.

From a certain perspective, we should be proud of our strong manufacturing capabilities, but foreigners only have the impression of Chinese products as "cheap", and products bearing China's own brands can only be displayed in inconspicuous corners in foreign stores.

, "Made in China" has become synonymous with low price and low grade in foreign eyes.

After so many years of development, Chinese companies have actually made great progress in product quality, and some of their products have even reached the world's first-class level. What China lacks is its own international brands.

Let’s take a look at reality: General Electric purchased Chinese Galanz microwave ovens and then put its own brand on them, and the price immediately went up several notches; Nike bought sneakers from a Chinese shoe factory for 120 yuan because

With the Nike brand on it, the selling price jumped to more than 700 yuan; the profit from Sony's color TV sales in China of 500,000 units a year exceeds the combined profits of all domestic color TV brands in China.

Chinese enterprises' previous thinking of winning on price should change. Adopting brand management and increasing brand premium to obtain more profits is the strategic change for Chinese enterprises to develop in the long term.

Therefore, studying brand premium capabilities and exploring effective strategies to improve brand capabilities are of great significance to improving the profitability of domestic enterprises, reducing corporate risks, and maintaining sustainable development.

Brand premium factors of brand premium First of all, let us give a basic assumption that consumers always aim to maximize their own interests when buying goods, and the so-called benefit maximization means that when the goods bring them a certain utility,

The cost is minimal.

Or based on a certain cost, the product brings the greatest utility.

When consumers purchase goods, they do not have much information about the quality of a certain product. On the contrary, the seller has a better understanding of the quality of the product. In this way, compared to the seller, the consumer has insufficient information. It is this kind of information

The asymmetric phenomenon makes some consumers willing to pay more for brands with good reputations to reduce losses caused by uncertainty.

In this way, manufacturers with good brands can obtain better brand premiums, and in order to maintain or improve their brand premium capabilities, they will strengthen product quality control, establish long-term reputation, and increase the value of their brands.