7 elements of brand valuation

The [tag]Interbrand[/tag] model of brand strength is a useful framework to consider the performance of your own brand. Consider these seven points and you should get a better sense of the strength of your own brand, as well as some ideas on how to move forward.

Market: 10% of brand strength. Brands in markets where consumer preferences are more enduring would score higher.

Stability: 15% of brand strength. Long-established brands in any market would normally score higher, because of the depth of loyalty they command.

Leadership: 25% of brand strength. A market leader is more valuable: being a dominant force and having strong market share matters.

Profit trend: 10% of brand strength. The long-term profit trend of the brand is an important measure of its ability to remain contemporary and relevant to consumers.

Support: 10% of brand strength. Brands that receive consistent investment and focused support usually have a much stronger franchise, but the quality of this support is as important as the quantity.

Geographic spread: 25% of brand strength. Brands that have proven international acceptance and appeal are inherently stronger than regional brands or national brands, as they are less susceptible to competitive attack.

Protection: 5% of brand strength. Securing full protection for the brand under international trademark and copyright law is the final component of brand strength in the Interbrand model.

Evaluate Your Brand

Brands are the most valuable assets that many companies have, representing a substantial portion of a consumer company’s overall market value or equity. Also, because it is becoming increasingly more difficult to sustain competitive product or technological advantages, it is likely that brands will continue to grow in importance and significance.

This is the introduction of an interesting PDF from GfK Custom Research and PriceWaterhouseCoopers, entitled “What Are Your Brands Worth?“, dealing with subjects as:

  • Advanced Brand Valuation Model
  • Psychological Brand Strength
  • Brand Isolation Module
  • Brand Forecast Module
  • Brand Risk Module
  • Brand Strategic Option Module
  • Case Study: Euro Max Petroleum
  • Determination of Brand Value