BRAND VALUATION METHODS AND STRATEGIES Presented By, Karthik.R Kirthika.A Manikandan.V
BRAND VALUATION METHODS <ul><li>These can be broadly classified into: </li></ul><ul><li>Cost based </li></ul><ul><li>Incom...
COST BASED METHODS <ul><li>Book value </li></ul><ul><li>Replacement value </li></ul><ul><li>Liquidation value </li></ul>
1.Book value method <ul><li>Current cost valuation </li></ul><ul><li>All assets are taken at current value and summed to a...
2. Replacement value method <ul><li>Cost of replacing existing business is taken as the value of the business </li></ul>
3. Liquidation value method <ul><li>Value if company is not a going concern </li></ul><ul><li>Based on net assets or piece...
INCOME BASED METHODS <ul><li>Earnings capitalization method. </li></ul><ul><li>Discounted cash flow method (DCF) </li></ul>
1.Earnings capitalisation method <ul><li>This method is also known as the Profit earnings capacity value (PECV) </li></ul>...
2.Applicability of DCF method <ul><li>Cash flow to equity </li></ul><ul><ul><li>Discount rate reflects cost of equity </li...
Limitations <ul><li>Companies in difficulty </li></ul><ul><ul><li>Negative earnings </li></ul></ul><ul><ul><li>May expect ...
MARKET BASED METHOD <ul><li>Also known as relative method </li></ul><ul><li>Assumption is that other firms in industry are...
Applicability <ul><li>Simple and easy to use </li></ul><ul><li>Useful when data of comparable firms and assets are availab...
Limitations <ul><li>Easy to misuse </li></ul><ul><li>Selection of comparable can be subjective </li></ul><ul><li>Errors in...
Brand Strategy  Step of brand strategy’s success is to check “Where Brand CAN & CANNOT Go”.
Steps in Brand Strategy <ul><li>Branding Vision </li></ul><ul><li>Brand Positioning </li></ul><ul><li>Brand Personality </...
Types of Branding Strategy <ul><li>Product Branding  </li></ul><ul><li>Product-line Branding </li></ul><ul><li>Product ran...
Integrated Communications Strategy Current Beliefs Current Actions Message Desired Belief Desired Actions
Points of Parity and Difference <ul><li>Brand   </li></ul>Consumers Competition Our  PODs POPs Their PODs .
Brand Strategy and Marketing Strategy <ul><li>Brand Strategy is separate from the 4P’s. It guides and inform decisions abo...
Brand Pyramid The  purpose  of the brand equity pyramid is to outline the basic building blocks of a what the brand should...
Brand Personality The  purpose  of brand personality is to ensure a brand behaves in a way that is consistent with its val...
Brand Elements <ul><li>Brand Name </li></ul><ul><li>Brand Logos and Icons </li></ul><ul><ul><li>Colors </li></ul></ul><ul>...
<ul><li>THANK U all  Friends   </li></ul>
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Brand valuation methods and strategies

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  • A structured conversation with the aim of auditing the brand? emotion v fact reputation and values Are we where we need to be today Where’s the future of the brand? where do we want to go What’s the gap What mechanisms, actions, processes are available to drive the brand in the right direction and build appropriate and valuable equity?
  • A structured conversation with the aim of auditing the brand? emotion v fact reputation and values Are we where we need to be today Where’s the future of the brand? where do we want to go What’s the gap What mechanisms, actions, processes are available to drive the brand in the right direction and build appropriate and valuable equity?
  • Transcript of "Brand valuation methods and strategies"

    1. 1. BRAND VALUATION METHODS AND STRATEGIES Presented By, Karthik.R Kirthika.A Manikandan.V
    2. 2. BRAND VALUATION METHODS <ul><li>These can be broadly classified into: </li></ul><ul><li>Cost based </li></ul><ul><li>Income based </li></ul><ul><li>Market based </li></ul>
    3. 3. COST BASED METHODS <ul><li>Book value </li></ul><ul><li>Replacement value </li></ul><ul><li>Liquidation value </li></ul>
    4. 4. 1.Book value method <ul><li>Current cost valuation </li></ul><ul><li>All assets are taken at current value and summed to arrive at value </li></ul><ul><li>This includes tangible assets, intangible assets, investments, stock, receivables </li></ul><ul><li>VALUE = ASSETS - LIABILITIES </li></ul>
    5. 5. 2. Replacement value method <ul><li>Cost of replacing existing business is taken as the value of the business </li></ul>
    6. 6. 3. Liquidation value method <ul><li>Value if company is not a going concern </li></ul><ul><li>Based on net assets or piecemeal value of net assets </li></ul>
    7. 7. INCOME BASED METHODS <ul><li>Earnings capitalization method. </li></ul><ul><li>Discounted cash flow method (DCF) </li></ul>
    8. 8. 1.Earnings capitalisation method <ul><li>This method is also known as the Profit earnings capacity value (PECV) </li></ul><ul><li>Company’s value is determined by capitalizing its earnings at a rate considered suitable </li></ul>
    9. 9. 2.Applicability of DCF method <ul><li>Cash flow to equity </li></ul><ul><ul><li>Discount rate reflects cost of equity </li></ul></ul><ul><li>Cash flow to firm </li></ul><ul><ul><li>Discount rate reflects weighted average cost of capital </li></ul></ul>
    10. 10. Limitations <ul><li>Companies in difficulty </li></ul><ul><ul><li>Negative earnings </li></ul></ul><ul><ul><li>May expect to lose money for some time in future </li></ul></ul><ul><ul><li>Possibility of bankruptcy </li></ul></ul>
    11. 11. MARKET BASED METHOD <ul><li>Also known as relative method </li></ul><ul><li>Assumption is that other firms in industry are comparable to firm being valued </li></ul><ul><li>Standard parameters used like earnings, profit, book value </li></ul><ul><li>Adjustments made for variances from standard firms, these can be negative or positive </li></ul>
    12. 12. Applicability <ul><li>Simple and easy to use </li></ul><ul><li>Useful when data of comparable firms and assets are available </li></ul>
    13. 13. Limitations <ul><li>Easy to misuse </li></ul><ul><li>Selection of comparable can be subjective </li></ul><ul><li>Errors in comparable firms get factored into valuation model </li></ul>
    14. 14. Brand Strategy Step of brand strategy’s success is to check “Where Brand CAN & CANNOT Go”.
    15. 15. Steps in Brand Strategy <ul><li>Branding Vision </li></ul><ul><li>Brand Positioning </li></ul><ul><li>Brand Personality </li></ul>
    16. 16. Types of Branding Strategy <ul><li>Product Branding </li></ul><ul><li>Product-line Branding </li></ul><ul><li>Product range Branding </li></ul><ul><li>Corporate Branding </li></ul>
    17. 17. Integrated Communications Strategy Current Beliefs Current Actions Message Desired Belief Desired Actions
    18. 18. Points of Parity and Difference <ul><li>Brand </li></ul>Consumers Competition Our PODs POPs Their PODs .
    19. 19. Brand Strategy and Marketing Strategy <ul><li>Brand Strategy is separate from the 4P’s. It guides and inform decisions about every aspect of the marketing mix. </li></ul>Brand Strategy is an integral part of the overall strategic marketing process. It helps to bridge the gap between business strategy and marketing strategy. I. Corporate Objectives & Brand Portfolio II. Marketing Objectives III. Brand Strategy Communications Strategy Product and Pricing Strategy Channel and Distribution Strategy IV. Marketing Execution & Monitoring Strategic Marketing Process
    20. 20. Brand Pyramid The purpose of the brand equity pyramid is to outline the basic building blocks of a what the brand should stand for in order to guide the process of building brand equity. It is the basis for determining key elements of the brand strategy – brand vision, brand positioning, and brand personality and brand measurement. Identity Relationship Response Meaning Resonance Consumer Judgments Consumer Feelings Brand Imagery Brand Performance Salience
    21. 21. Brand Personality The purpose of brand personality is to ensure a brand behaves in a way that is consistent with its values in order to increase its appeal and create greater affinity with its target. Brand personality can also help to differentiate a brand’s imagery relative to competitors.
    22. 22. Brand Elements <ul><li>Brand Name </li></ul><ul><li>Brand Logos and Icons </li></ul><ul><ul><li>Colors </li></ul></ul><ul><ul><li>Symbols </li></ul></ul><ul><ul><li>Music/Earcons </li></ul></ul><ul><li>Celebrities or Personalities </li></ul><ul><li>Advertising slogans and jingles </li></ul><ul><li>Brand Alliances/Secondary Associations </li></ul><ul><ul><li>Co-branding </li></ul></ul><ul><ul><li>Licensing </li></ul></ul><ul><ul><li>Sponsorship </li></ul></ul><ul><ul><li>Event Marketing </li></ul></ul><ul><ul><li>Celebrity Endorsement </li></ul></ul><ul><ul><li>Third-party Endorsements </li></ul></ul>
    23. 23. <ul><li>THANK U all Friends </li></ul>
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