CoreBrand Releases 2012 Brand Valuation & Management Predictions

NEW YORK, Jan. 3, 2012 /PRNewswire/ -- CoreBrand, a leading brand strategy and communications firm, and creator of the Corporate Branding Index®, which provides continuous benchmarking data, insights and corporate brand valuation for over 800 companies, across 49 industries, today released its 2012 brand valuation and management predictions.  These predications are presented by CoreBrand's Chief Executive Officer James R. Gregory.

"Our quantifiable valuation process, which encompasses 20 years of data within our Corporate Branding Index®,  finds that the corporate brand accounts for between 5% to 7% of market capitalization and can identify and predict changing company and market conditions," commented James Gregory, Chief Executive Officer at CoreBrand.  "With this proprietary data in hand, CoreBrand can provide an objective measure and add a science to the art of creative brand building and its impact on individual companies, industry sectors and the overall economy. In 2012, we expect the brand valuation process to continue to gain rapid acceptance and for our Corporate Branding Index® to become the standard valuation tool."

2012 Predications

• Several iconic brands will disappear 2012:  Numerous iconic brands that lost direction in their branding initiatives and investments, including Kodak, SAAB and potentially Sears, will disappear in 2012.  Many other brands, which CoreBrand's research shows are not pursuing the right level of investments, including Aon, CA, Cummins, Avery Dennison, D.R. Horton, Key Corp, Northern Trust, PPG, Steelcase and Yum, will no longer contribute positively to their company's corporate equity.  On a positive note,  brands such as AIG, Bank of America, BP and Netflix have positioned themselves to bounce back in 2012.
• International Accounting Standards Board will move towards recognizing brand value as an intangible asset: Accounting for the contribution of a brand to the financial performance of  a corporation will revolutionize the field of marketing. While brands may not become a fixture on a company's balance sheet, the International Accounting Standards Board (IASB) will finally begin to move towards recognizing brand value as an intangible asset (as long as it can be measured and valued on a continuous basis, such as our Corporate Branding Index® ).  It will move to have brand value recognized in the footnotes of annual reports, such as oil companies recognize proven reserves and pharmaceutical companies recognize drugs in the development pipeline.
• The accelerating growth of brands as a driving force of corporate value will help the economy: CoreBrand's research demonstrates that corporate brand equity is an early predictor of the economy and it is now indicating the start of an economic rebound that could continue over the next five years. In 2004, the average corporate brand contributed 7.4% to market capitalization. Since 2004 financial fundamentals, such as earnings, cash flow, expected cash flow and dividends have become more dominant thus diminishing the brand's contribution to corporate value.  In 2010, the corporate brand's value contribution for the average company in the CoreBrand 500 was only 5.3% (or 15.9% for the top CoreBrand 100 companies), however in 2011, brand power experienced a measureable turnaround across most sectors of the economy and is now pointing towards an economic expansion.
• The battle of the brands will continue unabated: By understanding and defining the value that the brand creates, the question about investing in building a company's brand building change from whether to invest, to how much to invest. Companies that understand this value can manage their brand investment to maintain and maximize value. CoreBrand's research demonstrates that top performing corporate brands are companies that communicate aggressively to influence their market landscape, thus shaping their markets to their strengths and gaining the associated benefits. 
  In 2012, the American automotive industry will continue to make gains with Ford Motor Company leading the way in revenue, quality and design. Telecommunications companies will continue to grow with AT&T and Verizon competing for top honors. Coke and Pepsi will continue their battle for dominance in the beverage industry, but with PepsiCo redoubling efforts to regain lost market share and improve the perceptions of its changing business strategy. FedEx and UPS are stumbling as they deal with  internal image problems, accelerated by YouTube videos exposing bad behavior of individual employees. BP will begin to recover from its oil spill created brand crisis, while ExxonMobil will try to build upon its image gains through corporate advertising. Apple will deliver more new products to prove there is life after Steve Jobs, while Microsoft continues to struggle to regain its former brand dominance.
• Brand valuation tools will get increased attention in the C-Suite and Board Room: As corporate leaders and Board of Directors begin to further understand the contribution of a corporate brand as a tangible asset, which needs to be nurtured and protected. Strategy, risk management and compensation committees will look for resources to measure their brands and create accountability.  There will be an increased awareness that by utilizing a tangible measurement tool, such as our Corporate Branding Index®, the impact of  leadership and marketing teams can be evaluated by their stewardship and management of a tangible asset over the long term.

About CoreBrand
CoreBrand, an independent branding firm based out of New York, is the only firm that links brand identity to financial performance through data and analysis. CoreBrand helps organizations understand, build, express and measure their brands.Thanks in part to its unique CoreBrand®Analysis, the company is able to gauge the impact of a brand initiative upon the success of an organization.  CoreBrand is the creator of Corporate Branding Index®, a 20 year old index that provides continuous benchmarking data, insights and corporate brand valuation for over 800 companies, across 49 industries.

SOURCE CoreBrand