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Know your worth: Understanding brand value


A recognisable and trusted brand name is a powerful asset with clear benefits in terms of customer loyalty, goodwill, market share and reputation. Companies work hard to build the status of their brand and product names, yet it can be a challenge to accurately quantify a brand’s value, and the role played by intangible assets, such as trademarks, designs, goodwill and know-how.

Why measure brand value
Intellectual Property (IP) has risen rapidly up the corporate agenda in recent years, with financial directors, company board members and shareholders all looking to their legal departments for strategic insight into the value of their IP assets. However, measuring the contribution made by intangible assets, such as trademarks, to brand strength, customer loyalty and corporate value has traditionally been a challenge for heads of legal departments, with many unsure about how best to approach their valuation efforts.

While rules exist to guide how to account for IP asset value on corporate balance sheets, traditional financial measurement tools (e.g. based on the cost of acquiring or licensing those assets) often tell only part of the story. These days, the value of a company’s brand and IP assets are far more than the sum of their parts and, in many cases, can be the key driver behind a business’s growth and success.

How to measure value
As part of its IP auditing capabilities, Novagraaf provides a tried-and-tested methodology to measure trademark value, assessing the extent to which a company’s core brands are strategically protected by trademark registrations in key markets and territories, as well as the comparable strength of those registrations. The approach also covers such factors as scope of coverage, effective use of trademark registration systems, ownership and portfolio consistency. The service has been specifically designed to provide businesses with greater insight and clarity into the brand and trademark valuation process, via a robust and transparent methodology, and clear advice on how to identify and remedy the issues that may be undermining asset value.

Often, simple changes to a company’s strategy can significantly improve the robustness of its IP portfolio. Valuation of IP as an asset can also unlock its true worth, and show that the right registration and protection strategy is an investment, not just a cost.