Investing in strong brands doubles returns
The valuation and strategy agency has tracked the brand values of world’s top brands for almost ten years and by taking a retrospective look at the share price of these brands, and their subsequent stock market performance, it has identified a clear link between strong brands and stock market performance.
Between 2007 and 2015, the average return across the S&P was 49%. However investing in companies with a brand value to enterprise value (BV/EV) ratio of greater than 30% would have generated returns of 94%. Investing exclusively in the 10 companies with the highest BV/EV ratios would have resulted in a 96% return.
Brand Finance chief executive David Haigh (pictured) said: “These findings demonstrate the powerful effect brands can have on the long term financial performance and enterprise value of businesses. Anyone tasked with reporting to shareholders should have brand strength and brand value front of mind.”
We hope you enjoyed this article.
Research Live is published by MRS.
The Market Research Society (MRS) exists to promote and protect the research sector, showcasing how research delivers impact for businesses and government.
Members of MRS enjoy many benefits including tailoured policy guidance, discounts on training and conferences, and access to member-only content.
For example, there's an archive of winning case studies from over a decade of MRS Awards.
Find out more about the benefits of joining MRS here.
0 Comments