Brand awareness is a measure of how many people in a target market know that a brand exists. It is usually expressed as a percentage of the demographic of interest. Companies work hard to promote and maintain brand awareness, especially when they make products that compete with numerous similar products. By having a memorable brand that stands out, a company can increase the chance that consumers will purchase its products when presented with a choice between the known brand and lesser known or unknown brands.
There are two components of brand awareness. The first is brand recall, which refers to whether or not people can name a brand or are vaguely familiar with it. Brand recall can be measured in two different ways. People can be asked to name a list of brands associated with a particular product or idea or they can be prompted with specific brands and asked if they are familiar. A marketing researcher might ask, for example, for a list of sodas, or ask a subject if the brand “Pepsi” is familiar.
Brand recognition is the other facet of brand awareness. Recognition refers to how well people connect a brand with products, ideas, taglines, and other attributes. Consumers may know a brand's name, but nothing else about it, in which case the product has poor brand recognition. On the other hand, people who associate a characteristic like “safety,” “lingerie,” “luxury,” or a company tagline with a product are demonstrating brand recognition. They are familiar both with the brand itself and with traits associated with it.
When companies study brand awareness, they look at both positive and negative perceptions of the brand. In this case, bad publicity is still publicity, and even when people have negative opinions about a brand, they are still aware of it. Understanding negative perceptions can also allow a company to address those perceptions with targeted marketing campaigns and other steps. Such campaigns may change consumer opinions and promote positive brand recognition.
Products that are not very differentiated from each other often struggle to capture market share. In this situation, the product with the most brand awareness wins. Companies can increase brand awareness with a variety of marketing practices including everything from sponsoring sports teams to running print campaigns in publications read by the target demographic. Some companies have been highly successful at this; companies like Coca Cola and McDonald's are almost universally known around the world, for instance.