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There’s a difference between “brand value” and “brand valuation.” Brand value is the strategic and financial value of the brand to your company today. Brand valuation is a financial exercise intended to put a price on the brand over and above the discounted future cash flows. The difference can be subtle. Tim Ambler of the London Business School uses this metaphor to describe the two: “Since I live in my house and plan to do so for some time, its value to me is the shelter and comfort I derive from it.

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Aside from a few purely direct-response businesses like catalog retailing, there is no business today capable of completely and comprehensively measuring marketing effectiveness without some doubt. Even the soundest efforts require that significant assumptions be made to fill the gaps in the data or deal with the uncertainties of dynamic markets, such as:

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Despite all the hand-wringing over marketing getting "a seat at the boardroom table," the irreversible trend we’re seeing in measurement of marketing effectiveness has improved both the return on marketing expenditures and the credibility of the marketing function within the corporation. Database technology, analytics, and Web presentation tools have all contributed to an unstoppable wave of desire to understand and quantify the impact of marketing expenditures on the company’s bottom line. All this is unquestionably for the better.
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Most of us have a pretty keen ability to look backward and know where we’ve been. Many of us have even advanced that skill to be able to look around and know where we are at the moment. But knowing whether you’re on track for where you expect to be six, 12, 18 months from now … that’s something only a very few managers have mastered.
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