by : David J. Smith
(Published : Journal of Business & Economics Research – November 2007)
ABSTRACT
The topic of brand equity continues to be of great importance to private sector firms in the creation and development of both product and company brand strategy. This study analyzes the relationship of different variables and brand equity with the purpose of providing useful insight into brand management and advancement. This research approach is unique in its use of private sector generated measures of brand equity as the main data source. The methodology entails collecting financial information from a list of publicly traded companies evident on the annual Interbrand ranking of top brand values, then executing statistical analysis using correlation and regression. Results make evident a significant positive correlation between brand equity and gross profit, advertising expense, and research and development expense. However, findings reveal that advertising is not as important a driver of brand equity in the short-term as put forward in previous research and evidence suggesting the presence of dynamics and non-linear effects exists.
INTRODUCTION
rand equity has received a great deal of research interest in the past 15 years and continues to be one of the most appealing fields of marketing for private sector firms. Brand equity issues are important in the design and development of a company and its product or service offerings. However, academics have not achieved a robust or widely accepted methodology of measuring a firm‟s brand equity or the effect of different variables on the valuation of a brand. The purpose here is not to develop an acceptable methodology for valuating brand equity, but rather to make observations based on the correlation of brand equity with selected variables in order to better understand the constructs. The importance of evaluating brand equity is clearly visible in recent merger and acquisition activity. The 2005 acquisition of Gillette Company by Proctor and Gamble illustrated this as the purchase price of $57 billion was 19 times Gillette‟s earnings before interest, taxes, and depreciation (Byrnes 2005). Why was the acquisition price so large? The value and perceived future earnings of the brands acquired in the deal – Gillette, Duracell, Braun and Oral-B played a large part in the determination of the purchase price. Researchers have also found that brands with high brand equity receive a considerable purchase price, even when a company has declared bankruptcy (Kaikati and Kaikati 2003). Converse . . . . .
Artikel lengkap dikompilasi oleh/hubungi :
INTRODUCTION
rand equity has received a great deal of research interest in the past 15 years and continues to be one of the most appealing fields of marketing for private sector firms. Brand equity issues are important in the design and development of a company and its product or service offerings. However, academics have not achieved a robust or widely accepted methodology of measuring a firm‟s brand equity or the effect of different variables on the valuation of a brand. The purpose here is not to develop an acceptable methodology for valuating brand equity, but rather to make observations based on the correlation of brand equity with selected variables in order to better understand the constructs. The importance of evaluating brand equity is clearly visible in recent merger and acquisition activity. The 2005 acquisition of Gillette Company by Proctor and Gamble illustrated this as the purchase price of $57 billion was 19 times Gillette‟s earnings before interest, taxes, and depreciation (Byrnes 2005). Why was the acquisition price so large? The value and perceived future earnings of the brands acquired in the deal – Gillette, Duracell, Braun and Oral-B played a large part in the determination of the purchase price. Researchers have also found that brands with high brand equity receive a considerable purchase price, even when a company has declared bankruptcy (Kaikati and Kaikati 2003). Converse . . . . .
Artikel lengkap dikompilasi oleh/hubungi :
Kanaidi, SE., M.Si (Penulis, Peneliti, PeBisnis, Trainer dan Dosen Marketing Management).
e-mail ke : kana_ati@yahoo.com atau kanaidi@poltekpos.ac.id
Butuh Artikel/Jurnal lainnya ?, click di :
- Jurnal Business & Marketing
- Jurnal Manajemen Sdm
- Daftar-Judul-Hasil-PENELITIAN-Relevan
- Jurnal Kualitas Jasa (Servqual)
- Jurnal Loyalitas Pelanggan (Loyalty)
- Jurnal Corporate Image
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