To Protect And Grow The Value Of Their Brands, Companies Must Look Beyond Current Valuation Methods

New Issue Of Sense From Lippincott & Margulies Offers Advice On Measuring Brands And Creating Value

NEW YORK, October 9, 2002

In an effort to understand and tap the real value of their brands, some marketing executives rely on simplistic “scoreboard” valuation methods for information on which brands to protect and which to extend.  While estimating the dollar value of a brand can be an interesting exercise, these methods fall short of helping to build and shape brands for the future, asserts Lippincott & Margulies in the new issue of Sense.

The newly published Sense — entitled “Can Brand Be Measured?” — is the 96th issue of the periodical from the firm that pioneered the discipline of identity and brand strategy consulting.  The lead article is an interview with John Zeglis, AT&T Wireless chairman and CEO, who says that gaining a deep understanding of the AT&T Wireless brand helped him to establish a foundation for fundamental business decisions and future brand development.  “We evaluated the brand we inherited, learned its attributes and decided where to take it,” Zeglis says.  Zeglis cites research by Lippincott & Margulies concluding that people consider his firm to be the wireless innovator.  “But it’s proving (to customers) that they can trust us to take them, hand in hand, into the future — that’s ultimately how we deliver on our promise,” he adds.

Picking up on that theme, the article “The Measure and Mismeasure of Brand” discusses why understanding what drives a brand’s value is more important than simply assigning a number to a brand’s worth.  It details Lippincott & Margulies’ view that brands can and should be measured, but with quite different tools than balance sheets and calculators.

According to Ken Roberts, Lippincott & Margulies chairman and CEO, “Brand is about real value, which means not only numbers but a measurement of the marketplace’s feelings and perceptions about a brand, its competitors and other factors.”  Roberts calls this approach Strategic Brand Assessment and he says its aim is “to provide a clear direction to improved performance and the ability to refine this path over time.”

Sense also includes timely insights from top branding executives at IBM, Citibank and Nissan North America on the role measurement plays in reinvigorating the brands of their companies.  The article reports that for these organizations, leadership in their categories is synonymous with brand strength.

Other articles in the new Sense explore ways to manage brand risk in the current uncertain economic climate and whether the value of a brand has an impact on equity analysts’ valuation of a company. 

Sense 96 can be downloaded by clicking here, or by visiting the Sense section of the website.