FINANCIAL BRAND VALUATION
We have extensive experience in the development and application of financial valuation methodologies of brands in various contexts and purposes, always guided by the principles that are laid down in the regulation ISO 10668:2010 Brand Valuation – Requirements for Monetary Brand Valuation.
The provision of brand financial valuation services offers complex challenges that require a range of skills that can be divided into two fields:
1. Financial and economic knowledge;
2. Ability to understand the context of a brand and how it influences business results, being able to translate abstract brand equity to indicators that relate to financial variables in an objective way.
Brands are often the most valuable intangible asset – they can be traded and recognized in accounting, and their financial value can be an important tool for evaluation and monitoring in brand management – especially if combined with market research with consumers.
However, there is no one methodology that fits all situations across the board. The ISO 10668:2010 standard itself provides for various methodological approaches: Income Approach, Market Approach, and Cost Approach, as well as all the sub-methodologies in each approach.
One is not left with only a single rigid standard, which could lead to ignoring relevant a priori information and methodological choices that are more correct given the purpose of the valuation.
A methodological approach should always be subject to critical appraisal.
One is not left with only a single rigid standard, which could lead to ignoring relevant a priori information and methodological choices that are more correct given the purpose of the valuation.
A methodological approach should always be subject to critical appraisal.
Among the most distinctive principles that guide Brand Practice evaluations from a methodological point of view are the following:
- That of transparency, with the maximum rejection of “black box” type options in which proprietary and confidential algorithms are used – we have experience in performing evaluations that are audited by external entities and statutory auditors;
- In-depth sensitivity and analysis of the competitive context of the brand;
- The greatest possible adherence of the valuation to the reality of the brand and its competitive situation in the market, to the detriment of fluctuations due to short-term conjunctural situations;
- Robustness in the sensitivity analyses of the main indicators and assumptions made;
- Conservatism in the assumptions.
Get in touch:
