WARC recently published my article, “Widening the Lens: How to Modernize Brand Valuation.” Here’s an excerpt of the piece, in which I explore the evolving nature of brand value and how to effectively measure it with a link to the full article at the end.
Why linear brand valuation models no longer work
Brand valuation is at a crossroads. For decades, we’ve relied on traditional metrics that gave us a linear path from brand investment to brand value. However, in today’s digital, media-fragmented, real-time brand landscape, this linear model isn’t going to cut it anymore for many professionals.
The digital age has transformed the way brands interact with consumers. The speed of change, the complexity of consumer interactions, and the fragility of public sentiment means that a single post on X, Instagram, Reddit, or TikTok can drastically alter brand perception overnight. To keep pace with these dynamics, we need to evolve our brand valuation frameworks beyond the simplistic linear model.
Revisiting classic frameworks
Kevin Lane Keller and Donald R. Lehmann introduced a framework known as the Brand Value Chain. Keller and Lehmann’s brand value chain provides a sequential process starting from marketing investments to customer mindset, then market performance, and finally to shareholder value. It’s a tidy, logical progression where each stage builds on the previous one:
- Marketing Program Investment
- Customer Mindset
- Market Performance
- Shareholder Value
While this model has provided valuable insights, it presumes a linear progression that often oversimplifies the vastly more complex, multi-directional interactions occurring in today’s brand ecosystem. We now operate in a world where digital interactions and social media influence are omnipresent and instantaneous.
Embrace non-linear valuation
In my latest article for WARC, I explore how we need a modern brand valuation framework, one that offers a more nuanced approach that reflects today’s complex digital and social media environment. We need to move beyond linear assessments and embrace a non-linear model that incorporates critical new metrics.
Continue reading on WARC…
Read the full article on WARC to discover how modernizing your brand valuation strategy can unlock new opportunities and drive sustainable growth. (The piece is openly accessible to WARC subscribers.)
