Brand Value - Definition

With reference to Brand Finance literature, the term "Brand Value" is considered to be the net present value of the estimated future cash flows attributable to the Brand.

Brand Finance use the Royalty Relief (Relief from Royalty) methodology to value a brand, which is described in more detail on the Royalty Relief definition page

Brand Value is also referred to has Brand Equity. A brand can be an intangible asset, used by consultants like Brand Finance to rationalise the variation between a company's "book value" and market value. For example, groundbreaking research conducted by Brand Finance demonstrated that 62% of the world's business is now intangible. This represents $19.5 trillion of $31.6 trillion global market value.

Brand value in the case of consumer product brands can be measured through customer loyalty, staff retention/recruitment. Therefore Brand value can be influenced positively and negatively; with a number of famous examples where Brands have made the right (Intel Inside marketing activity) or wrong decision (New Coke vs the American public).

 

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