# What Is Brand Recognition? Why It's Important and Benefits

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*— Getty Images / volkankovancisoy*

## What Is Brand Recognition?

Brand recognition is a concept used in advertising and [marketing](https://www.investopedia.com/terms/m/marketing.asp) to describe consumers' ability to recognize a [brand](https://www.investopedia.com/terms/b/brand.asp) through visual or auditory cues such as [logos](https://www.investopedia.com/business-essentials-4689832), packaging, colors, slogans, or jingles. Companies often conduct [market research](https://www.investopedia.com/terms/m/market-research.asp) to assess the effectiveness of their brand recognition strategies. Strong brand recognition can result in higher sales and profit margins, even if competing brands are of equal quality.

### Key Takeaways

*   Brand recognition refers to how well consumers recognize a particular company and its products vs. those of its competitors.
*   A company is perceived as having successful brand recognition when consumers can recognize it through visual or auditory cues alone, even without seeing or hearing its name.
*   Cues that can foster brand recognition come in such forms as logos, slogans, and jingles.
*   Building and maintaining brand recognition is an ongoing project, often driven by market research.

## How Brand Recognition Works

A brand is a name, logo, word, mark, tagline, or any other identifying characteristic that distinguishes a company's products or services from others on the market. A brand is among the most important [assets](https://www.investopedia.com/terms/a/asset.asp) that a company has because it represents the company and helps keep the company in consumers' minds. The responsibility for overseeing a brand and growing its value over time is often referred to as [brand management](https://www.investopedia.com/terms/b/brand-management.asp).

Brands are considered a form of [intellectual property](https://www.investopedia.com/terms/i/intellectualproperty.asp) and treated for accounting purposes as [intangible assets](https://www.investopedia.com/terms/i/intangibleasset.asp) that can be assigned a dollar value. They are normally protected using [trademarks](https://www.investopedia.com/terms/t/trademark.asp).

Companies invest a lot of time and money to build brand recognition so that consumers will recall—and ideally choose—their brand over its competitors. A company's marketing department will often use multiple cues—both audio and visual—to help set their brand apart in the marketplace. Logos like the Nike ([NKE](https://www.investopedia.com/markets/quote?tvwidgetsymbol=NKE)) swoosh and the Golden Arches from McDonald's ([MCD](https://www.investopedia.com/markets/quote?tvwidgetsymbol=MCD)), and taglines like "They're magically delicious" for Lucky Charms cereal and "I'm a big kid now" for Huggies Pull-Ups diapers help further brand recognition.

A study of 597 corporate logos, published in the _Harvard Business Review_, found that descriptive logos that "clearly communicate the type of product or service a brand is marketing" were generally more effective in promoting brand recognition than nondescriptive ones, which "contain design elements that are not indicative of the type of product or service these brands are selling." As an example of a descriptive logo, the authors cited the Burger King logo, which includes the word "burger" and the top and bottom halves of a hamburger bun. By contrast, the Golden Arches logo long used by McDonald's is a nondescriptive logo (although a highly successful one in terms of worldwide recognition).

To measure brand recognition and the effectiveness of their promotional and [marketing campaigns](https://www.investopedia.com/terms/m/marketing-campaign.asp), many companies conduct market research using focus groups, online surveys, and other techniques.

### Note

Brand recognition is also referred to as aided brand awareness, with cues such as a logo or distinctive color aiding consumers in remembering a brand name.

## Building and Maintaining Brand Recognition

Whether they're [small businesses](https://www.investopedia.com/small-business-4427743) or huge [corporations](https://www.investopedia.com/terms/c/corporation.asp), or somewhere in between, companies can do many different things to create and maintain brand recognition. If they're effective, the brand can make itself [top of mind](https://www.investopedia.com/terms/m/mindshare.asp) with consumers—an opportune place to be when those consumers are ready to buy. Here are a few ways they can do this:

*   Consumers tend to remember brands that reach them on an emotional level, so a company may use a unique, touching, or heartfelt story that lets customers know why it's in business.
*   Another way to build and maintain brand recognition is to provide exemplary [customer service](https://www.investopedia.com/terms/c/customer-service.asp). Consumers are more likely to recommend and buy products from a company they believe values their patronage.
*   In addition to exceeding their customers' expectations, businesses can also help educate them. Being known as an expert in a certain field or being able to relate to customers and how they use the products and services they buy goes a long way in ensuring [brand loyalty](https://www.investopedia.com/terms/b/brand-loyalty.asp).
*   Small businesses and large companies alike can employ [social media](https://www.investopedia.com/terms/s/social-media.asp) to make sure their names, products, and services are in constant circulation. Of course, a company's logo or visual theme should be used in all communications for consistency and to enhance its recognizability.

## Brand Recognition vs. Brand Awareness

Brand recognition is different from [brand awareness](https://www.investopedia.com/terms/b/brandawareness.asp), another common term in the worlds of advertising and marketing. While brand recognition refers to the visual and audio cues people use to identify a brand, brand awareness is simply the extent to which the public knows that a company and its products or services exist.

As such, brand awareness can be considered a preliminary step on the path to brand recognition. For instance, if people didn't know anything about the Apple ([AAPL](https://www.investopedia.com/markets/quote?tvwidgetsymbol=AAPL)) brand, they probably wouldn't recognize and associate the famous Apple logo with its products.

## What Company Has the Most Valuable Brand?

One recent study put Apple at the top of the list, valuing its brand at over $516 billion. Others in the top five included Microsoft, Google, Amazon, and Samsung.

## What Is Brand Equity?

[Brand equity](https://www.investopedia.com/terms/b/brandequity.asp) refers to the premium a company can charge for its products and services over its competitors' offerings, even though there may be no difference in quality.

## What Are the 'Three C's' of Branding?

The three C's of branding are guidelines for creating and maintaining a successful brand. They are _clarity_ (making it clear what the brand has to offer), _consistency_ (being consistent with your visuals, messages, tone, etc.), and _constancy_ (frequently reminding potential customers that you're around).

## How Do You Trademark a Brand?

To trademark a brand, you need to file an application with the United States Patent and Trademark Office, which explains the step-by-step process on its website.

## The Bottom Line

Branding is both an art and a science. Companies that do it successfully, as evidenced by their brand recognition, can enjoy greater sales and profits. But maintaining high brand recognition also requires consistent messaging and constant efforts to keep the brand in front of consumers.

> **Article Sources**
>
> 1.  Harvard Business Review. "[A Study of 597 Logos Shows Which Kind Is Most Effective](https://hbr.org/2019/09/a-study-of-597-logos-shows-which-kind-is-most-effective)."
>     
> 2.  Statista. "[Most Valuable Brands Worldwide in 2024](https://www.statista.com/statistics/264875/brand-value-of-the-25-most-valuable-brands/)."
>     
> 3.  United States Patent and Trademark Office. "[Trademark Process](https://www.uspto.gov/trademarks/basics/trademark-process#step2)."