I’ve been thinking of a new way to calculate the value of a brand. Sure there are large infographics which constantly tout the world’s most valuable brands, but if you look from one source to another, you’ll find discrepancies. That’s because a number of folks have derived interesting ways to understand the value of a brand.
I wanted to think of a simpler method that you could deploy at a company no matter the size and compare it to its peers. To do this, you would need to:
- Measure the size of the target market for your company
- Survey a number of individuals within this target market
- Ask them three questions – Do you know of brand X? Do you think of brand X positively or negatively? Would you pay more money to use this brand vs another?
Using this data you can compare the relative strength of all players within a market. And you can realistically compare companies across different markets.
The equation would break down to a basic index something like… (%Known + %Positive + %Pay) / 3 = Brand Market Index
This would allow you to see how you’re being perceived by all of your core demographic, and allow you to measure and compare against your competitors.