Data Driven: Return on Brand
Database and direct marketing have always been driven by tracking, measurement, analytics and in some ways, ROI. Historically, the idea of "brand" has been given a relatively free pass when it comes to direct, measurable accountability. To explore the ways to bridge this divide and help establish some analytical approach to measuring the value of your brand, let's consider the concept of return on brand (ROB).
What Is a Brand?
ROB can be derived from looking at three areas—preference, performance and premium—critical to the inherent value of a specific product or service. These three areas create a quantitative analytic framework for establishing ROB.
But first, the analytics of ROB actually start with the question: What is a brand? There are as many definitions of a brand as there are marketers trying to build, manage and exploit them. One definition states a brand is a mixture of tangible and intangible attributes associated with a product or service that, if managed properly, creates value and influence. It is the combination of both tangible and intangible attributes that makes analyzing the value of a brand tricky and a bit murky.
The more tangible attributes or value—which some refer to as the technical and commercial value of a brand—are metrics such as margin, profit, yield index or market share. These are real measurements that have real calculations and real numbers behind them. And while they may not always be easy to quantify, once a method has been created, it can be a very useful and critical tool.
Several industries and business circumstances take a more technical approach. The financial industry places values on brands for mergers or acquisitions. Lawyers and courts place values on brands in trademark and property rights disputes. From a marketing perspective, the value of a brand can be derived from the levels of "branded" search term use. And closer to the world of direct marketing, companies have been bought or sold on analytical valuations of the volumes or sizes of customer files.