1) Compare and contrast the methodologies used by Interbrand (http://www.interbr
ID: 328786 • Letter: 1
Question
1) Compare and contrast the methodologies used by Interbrand (http://www.interbrand.com) and BrandZ (http://www.brandz.com/) to determine brand value.2) Can Advertising Strategy (and related activities) increase brand value? Why or why not? 1) Compare and contrast the methodologies used by Interbrand (http://www.interbrand.com) and BrandZ (http://www.brandz.com/) to determine brand value.
2) Can Advertising Strategy (and related activities) increase brand value? Why or why not? 1) Compare and contrast the methodologies used by Interbrand (http://www.interbrand.com) and BrandZ (http://www.brandz.com/) to determine brand value.
2) Can Advertising Strategy (and related activities) increase brand value? Why or why not?
Explanation / Answer
Methodologies used by interbrand and Brandz to determine the brand value:
The brand valuation methodology adopted by interbrand aims at providing a rich and insightful analysis of the brand. It helps in evaluating how the brand is contributing effectively to the business results together with the activities that it delivers tomorrow.
The methods used are:
Financial analysis: financial analysis can be used as a methodology to determine the brand value. This can be done by analyzing the profits that the company generates through its business. If it shows a reasonable percentage of profits, then it will have a very good brand value for its products.
Role of brand – role of brand is the various role the brand plays. Like the usage of the product (i.e. defining its purpose, the features of the product like its color, size, shape etc., the price which is nothing but the cost of the product. Design and style is how the products are designed or structured in a unique way to attract and retain its customers. When the product is unique in all these things, then it can have a good brand value.
Brand strength – the strength of the brand is the service that it provides to the customers, which can be considered as commitment toward customers, how the product offers protection, if it is against the interest of the society where responsibility of the brand can be clubbed with this. Whether the product is relevant to the target customers and if it fulfills the need or the purpose for which they buy them and also how unique is the product when compared to the competitors.
Methodologies used by brandz:
The method used by brandz also looks almost similar to interbrand.
Calculation of financial value
Calculation of brand contribution
Calculating brand value
Calculation of financial value: here brandz follows two approaches. First one is calculating the earnings or the profits generated by brandz and the second approach is predicting the future earnings. This is an approach used by the financial analysts to determine the market value of stocks. We take the brand earnings and multiply that by brand multiple to arrive at financial value.
Calculation of brand contribution: the factors considered under this are price, availability and distribution of the product. For further analysis, the brand is distinguished on various aspects like how the product is unique, whether brand comes immediately in the minds of the consumer when they go for purchases and if the brand focuses on emotional aspects of its consumers.
This is the only one which is conducting in-depth research of its consumers, online and face to face research about the consumers to determine its value.
Calculation of brand value: brand value is calculated by multiplying financial value with brand contribution to arrive at brand value. It is the amount the brand contributes to the value of the entire corporation
2) Can advertising strategy increase brand value:
Advertising strategy for sure can help increasing the brand value in the following ways:
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