What is brand value? According to Kotler’s Marketing Bible (Chapter 10), it is “the added value endowed on products and services. It may be reflected in the way consumers think, feel, and act with respect to the brand, as well as in the prices, market share, and profitability the brand commands for the firm”.
How do you measure the value of your brand? Theoretically, the brand value chain is a structured approach to assessing the sources and outcomes of brand equity and the manner in which marketing activities create brand value.
Now in practical terms…
When Tata Motors acquired Jaguar Land Rover in 2008, they paid $2.56 billion only for the brand – this was more than the cost of all the factories, the raw materials and all the employees together. Why? Carlton Curtis, VP Corporate Communications at Coca-Cola said: “If Coca-Cola’s assets were destroyed overnight, whoever owned the Coca-Cola name could walk into a bank the next morning and get a loan to rebuild everything”.
Branding is everything – branding is the base and the top of the pyramid. Branding is the one building the pyramid. Branding is the one who thought about building the pyramid. We can take the metaphor as far away as the Homo sapiens used to transcribe their world into visual representations using cave paintings. Even in 2,000 BC, farmers’ cattle and livestock were branded physically with “mark”, “watermark” and “logo”.
Since the industrial revolution, we now understand that branding is not just a logo or a mark but the communication of benefits, features and the emotional connections with the audience (called “Corporate Identity” since 1958 by Gordon Lippincott).
Brand is everywhere
Branding is everywhere – from Napoleon’s hat to the Union Jack flag, from the Michelin character to American Idol, from Apple to Facebook, Nike, McDonald’s, Disney, Google and even money – just a piece of paper but with a brand owner (the central banking system), an endorsement from national celebrities, and an emotional message (“In God We Trust”). It is not a piece of paper anymore, branding gave it a value.
Every perfume commercial sells you the atmosphere and values of L’Oréal, Chanel or Dior. Every car commercial will show you how masculine you will fell; how much freedom you will get. The product itself comes after. You can argue with the need to buy something material. You can’t argue with your emotional feelings.
When the World was smaller (or bigger – depending on the perspective), the need for branding was manageable. With the World moving online, new markets like Brazil, China, India, Russia, and Indonesia being connected, the number of consumers has drastically increased. These consumers consume brands.
So how much is your brand worth? The answer comes from the field. If your clients recognize your brand and corporate identity, tone of voice, values, and if you engage them correctly – they will follow you, no matter what feature your product has or not. As an iPhone addict – would you imagine switching to a Galaxy device? As a Real Madrid fan – would you ever support Barcelona?
If the answer is yes, you must be either very open-minded or anti-branding. If as most of us, you would never leave your iPhone or sing “Barça, Barça, Baaarça”, you just prove that both Apple and Real Madrid did an amazing branding job that worth each million dollars spent.