Marketers “move up the food chain” with new brand valuation standard

Marketers will have more input in the brand valuations used in M&A, restructuring or management decisions following the creation of a new brand valuation standard that requires their input for the first time.

The International Organisation for Standardisation – a network of standards institutes of 163 countries – has set out a framework for valuing brands that will require marketers to provide insight in addition to the usual financial and legal perspective.

Marketers will be asked to contribute “behavioural aspects” including stakeholder perceptions, market context and effect on demand. Measures of brand strength, including loyalty, awareness, attitude and perceptual attributes, will also be included.

Stuart Whitwell, director of Intangible Business, who sat on a panel representing Britain in discussions to set the framework, says the new standard will allow marketers to “move up the food chain” in an organisation by providing input into the valuations used in corporate activity such as M&A and analysis of markets.

He adds it will also allow marketers to “manage the valuation process and communicate the value of their brands more effectively”.

“There was no standard that encapsulated all elements of the brand valuation process. Previous protocols were written purely for accountants and focused on more technical financial methodologies, not from a commercial or marketing perspective,” he says.

The British panel worked with others from around the world, including China, Australia and most European countries, to agree on an international standard. The notable exception is the US.

It is hoped that the standard, which starts operating on 7 October, will be adopted internationally.

It will be marketed through the ISO’s member states and national branches, including the British Standards Institution in the UK.

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