Legal Applications of Marketing Theory, part 2

Dominique Hanssens, Natalie Mizik, & Lorenzo Michelozzi, UCLA Anderson, Univ of Washington, Cornerstone Research, Brand Value, Marketing Spending and Royalty RatesBrands can create value, but require ongoing marketing. When licensed, disputes can arise about royalty rates and marketing support/maintenance effort. Can we measure the financial value of a brand? Quantify relative impact of brand and ongoing marketing spending?Lots of effort goes into valuing brands. Five major brand value entitities: Interbrand (top 100); Millward Brown, Brand Finance (top 500), Forbes, Eurobrand (top 100 corporate parents). What methods? Only two major methodologies for economic use value. (1) Earnings split: NPV of brand-specific earnings of the business.  (2) Relief from royalty: NPV of notional licensing fee that a company would have to pay for the use of brand.  In principle, both should yield approximately the same estimate. Significant differences between the various list…

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