ANA: Most Senior Marketers Don't Grasp Brand Value

Now that The Brand Bubble (about which we wrote Oct. 13) has spelled out that most brands--and therefore their companies--are greatly overvalued by the financial markets, we find out that those on the inside do not have a clear idea of what their brands are worth, either.

More than half (55%) of senior marketing executives lack a quantitative understanding of brand value within their organizations, according to a recent survey by the Association of National Advertisers (ANA) and global branding consultancy Interbrand.

Furthermore, because brand value's effect on corporate value is not clearly quantified, it isn't being incorporated in decision-making: 64% of the 118 marketing officers and senior marketing executives polled said that brands do not influence decisions made at their organizations.

"Now more than ever, brands must be examined and evaluated just as closely as any other corporate asset," says Jez Frampton, Global CEO of Interbrand. "It's no coincidence that strong brands, like Apple or Google, often have a strong stock price. Companies need to fully understand what drives demand on a second-by-second basis."



Most (80%) of the marketing executives said they are under increasing pressure from top management to prove that branding initiatives improve company profitability. Yet in many companies, "creating and managing brand value still follows an archaic model" in which it is relegated strictly to the marketing department, Frampton stressed.

"It is critical for marketers to fully appreciate the value of the brand to have a voice with the C-suite to accomplish overall business growth objectives," adds ANA President and CEO Bob Liodice. "Identifying where this misunderstanding exists is the first step to help marketers develop the tools they need to contribute to financial growth."

What gets in the way of leveraging brand value? Among those who said brands don't influence corporate decisions, the underlying causes cited include: incentives that don't support brand importance (51%); inability to prove the brand's financial benefit (49%); existing branding expertise is not widely accepted (40%); metrics do not support the brand's importance (39%); budgets are focused on communications activities (32%); brand is not included in the "sphere of influence" (28%); and branding expertise does not yet exist (15%).

At the same time, senior marketers agreed that quantifying how, when and where their brands create corporate value would enable numerous benefits, including: more focused marketing investment (93% agreed); ability to cut underperforming initiatives (82%); producing greater influence for overall alignment and change across the organization (79%); giving marketers more leverage in securing additional investment from boards (69%); generating active data that can be used to hone messaging (60%); and enhancing the ability to evaluate staff performance (40%).

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