We’re all familiar with it – as soon as we see the iconic target and bullseye, we know we are about to experience shopping bliss. At least that’s the case with me, singlehandedly paying hundreds of dollars to Target (Links to an external site.) a month, even when I don’t need anything.

So why is it that people blindly hand over their money to companies like target? How has Target reached the highest levels of brand loyalty and extreme brand identification?

Target boasts the tagline, “Expect More. Pay Less,” which Target CFO, Michael Francis (Links to an external site.), would characterize as the “balance between making [their] guests aware of value while emphasizing superior merchandise and a pleasant shopping experience.”

Value, check. Superior Merchandise, check. Pleasant shopping experience, big red check!

Target has this big red identifier that allows consumers to recognize the brand, but they are also able to associate the brand with value, great products, and an unparalleled buying experience. If you compare Target to a retailer like Walmart that has a similar business brand, and similar value sub-brands (Great Value and Up & Up), Target will still come out on top due to the pleasant layout of the store and shopping experience.

So how is Target totally winning? Brand Equity.

Because Target has gained the trust of their consumers and always deliver on their promise to the buyer, Target is now able to capitalize on the trust built and brand loyalty. While Target has its own value brand, the company has been able to use equity to sell other established and sought after “designer” brands at a fraction of the price.

A perfect example of this is the Hearth & Hand with Magnolia (Links to an external site.) brand by the stars of the hit show, Fixer Upper, Joanna and Chip Gaines. While the brand is marketed as an affordable “everyday home & lifestyle brand,” it is actually quite expensive. However, in making this designer line available to ordinary people, Target is able to sell something more expensive than its typical inventory based on superior quality and celebrity endorsement. More importantly, people think highly of the Hearth & Hand and Target brand, creating positive brand equity.

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