Mega-Brands or Mega-Spenders?

Schultz, Heidi
March 2005
Marketing Management;Mar/Apr2005, Vol. 14 Issue 2, p10
This article asserts that advertising should not be a basis calculating the value of a brand. A 2004 annual report on the most valuable or important brands from the newspaper Advertising Age calculated brand value based on advertising spending. In other words, the definition of a megabrand or a superbrand is based on spending, not on returns. The more invested in a brand, the more it is viewed as important in these rankings. This spending approach to classifying brand importance is so disturbing. Brands should make money for the firm, not cost money. Too many marketing, communication, branding, and media people glorify spending over creating returns and long-term shareholder value. value. The bigger the measured media, marketing, or communication budget, the more important the brand or marketing program is thought to be. Yet the brand exists for only one reason: to generate income and profits for the firm. Simply being able to spend more than the other guy, as good as it may look in the rankings, does not provide much proof of brand importance. Clearly, the answer is to better measure the returns on branding investments the organization receives, not just continuing to monitor what the brand manager spent.


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