The Importance of Brand Valuation: Understanding ISO Standards

Hello, I’m Dave Stewart, professor emeritus and founding chair of the Marketing Accountability Standards Award (MASBY). This video is the first in a series addressing the financial value of brands and the ISO standards 10668 and 20671 related to brand valuation and evaluation.

ISO Standards for Brand Valuation

Over the past two years, ISO has issued standards addressing brand valuation and evaluation. These standards provide an opportunity for marketing to leverage the credibility and influence of ISO for the benefit of the marketing discipline.

The Financial Value of Brands Imperative

MASBY published “The Financial Value of Brands Imperative: Why Brands Must be Valued in Financial Terms” in June 2021 to build awareness and understanding of brand valuation. This publication addresses the misunderstanding of marketing and market-based assets’ short-term profitability and their long-term contribution to the enterprise.

Illustrative Example: Hostess Brands

An illustrative example in the MASBY publication highlights Hostess Brands’ acquisition for $410 million in 2013, which now has a market capitalization of nearly $3.5 billion under the ticker symbol TWNK. This demonstrates the impact of well-executed marketing actions on the value of the enterprise.

Measuring Brand Value

MASBY advocates for brand-centric enterprises to develop an internal process to measure, explain, and report the financial value of brands to the executive level. This annual measurement and analysis demonstrate the material contribution of brands to the overall value of the enterprise.

Best Practices for Brand Value Measurement

MASBY stresses the importance of including measures of the strength of the customer franchise in the brand value measurement. It offers perspectives on best practices for creating, defining, and implementing an approach to measuring brand value.

Conclusion

In this series of videos, MASBY will cover various topics related to brand valuation and provide detailed illustrations of how a brand-centric enterprise can develop and implement an internal methodology to measure and report brand value. We aim to help managers become more effective stewards of their organization’s resources and assets.

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