Bite-size Case Study

Isolating the increase in brand value

Published on April 3, 2016 Originally recorded 2014   6 min
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We are going to be talking about how to isolate the brand impact from market noise. We really think it's far more important to look at the percentage of market cap impacted by the brand, rather than the dollar value, and I'll be able to explain it better on the following pages. This is an actual brand equity valuation case study of a very interesting company and it shows the return on investment for specific spending levels.
This case study is a large commodity transportation company. It's well known and it had begun to slowly decay. They had run into a number of problems. They had a few acquisitions that were not actually being incorporated into the company in a graceful manner, and as a result, the senior management decided they wanted to run a campaign, to see if they could bolster their company's profile and also, to be able to identify if there was actually any value created from doing the campaign. So it was a very conservative organization. They really didn't want to spend a lot of money. They really didn't want to do anything unless they could prove the value of it. The brand equity in that category was above the corporate branding index average and it was actually quite good for their industry. As I said, they didn't want to spend a whole lot but they committed to being able to spend $25 million over a period of about 18 months and that was coming off a starting point of zero. They were spending absolutely nothing on the brand other than their internal communications public relations department. And what we were able to do was isolate the impact of the brand on market cap and be able to track the improvements over time.