Corporate Brand And Wall Street
- Topics:
- Brand Management
- Tags:
- Brand,
- Branding,
- Marketing,
- Marsh & McLennan Companies
- Source:
- Marsh & McLennan Companies
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Overview: Brand value as a number has little relevance. It can change at any time. Brand value and valuation are dependent on marketplace dynamics and management. Strong brands signify strong companies. While there have been instances where “image” overtook reality (e.g., Enron, Adelphia, the dot-coms) and caused stock prices to soar only to plummet once sanity returned, they were the exception not the rule. Rankings of brand value have not much validity, except in retrospect to indicate change over time. Brand value may be important in determining whether an acquirer paid appropriately or how a spin-off may perform or be valued. But, by and large, analysts look for investments based on other factors, including 1) a strategy that is understood and valued, 2) a strong, dynamic business model, 3) a stable industry not likely to be commoditized, and 4) active growth and market development plans Valuing a brand in financial terms has been employed to help understand an acquired or divested brand. However, the validity of this practice varies from category to category and situation to situation. In acquisitions, companies often happily pay more for a well-known brand. Creating a brand can be risky and expensive. In general, brand consistency is critical. If you are consistently recognizable, that is a huge leg up. In addition, if visual identity has not been leveraged, that is unfortunate.
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Format: PDF | Size: 40KB | Date: Jan 2003 | Pages: 2
