A taxonomy of brand valuation practice: Methodologies and purposes

Abstract

Brands can be valued using a variety of techniques. Like any tool, each technique may be suitable for some purposes and not for others. This article classifies brand valuation methodologies according to the approaches and premises they adopt and their suitability for different types of applications. The article only considers financial brand valuation, not other forms of brand equity measurement. We indicate some flaws in valuation methodologies either in general or for particular purposes. Classification is complicated by specialist firms seeking to differentiate methodologies (proprietary models) for their own marketing purposes. Much of this differentiation is little more than re-labelling. The methods of brand valuation, and their specialist providers, garnered from the literature may represent many more around the world. On the other hand, our net was sufficiently large to be confident that all the main approaches have been captured. After removing the theoretic methods that do not appear to be used in practice, we were left with a short list of practical methods that we analyse and classify. This article sets out to map this jungle to assist practitioners and academics in assessing the alternative techniques. © 2009 Palgrave Macmillan.