Final answer:
Brand equity can create opportunities for brand licensing, where other companies pay to use an established brand name or trademark, which also serves as a strategic barrier to entry for potential competitors.
Step-by-step explanation:
Brand equity leads to lucrative brand licensing opportunities, where another company wants to pay a royalty or fee to use your well-established brand name or trademark. A strong brand, bolstered by significant advertising budgets, can present barriers to entry for competitors, as seen with the dominance of companies like Coca-Cola and Pepsi.
This barrier to entry is a strategic advantage that discourages potential new entrants due to the high costs of competing against established brands. Additionally, trademarks serve as a form of legal protection for brands, ensuring that only the company that has registered the trademark can use the identifying symbols or names associated with their goods.