Does a Brand Have a Dollar Value?

April 3, 2017

I’ve been in the middle of many conversations listening to early stage businesses share that they have not invested much into building a brand because they can’t directly tie it back to ROI. They go on to say sales is paramount to growing the business, so the emphasis is placed there. Makes sense… except from my vantage point, how the “brand” is perceived has a lot to do with whether or not someone will buy.

I’ve witnessed first hand how a rebrand can take a business owner from $250K to over $1M in less than a year. If you want to talk to my client, I’ll give you her number. It’s a story she loves to tell because she didn’t realize how brand could impact her business until we began to work together. At one point she exclaimed, “I get it! Brand is everything.” Her exact words!

So what is it about a brand that helps it make money and more importantly, can a dollar value be placed on a brand? Since brand is a “feeling” and buyers are most often emotional about their purchases, it makes sense that if a brand resonates with a particular audience and that audience feels strongly that the brand can provide their solution better than another brand, it’s likely the one that resonates will get the sale.

In a market where products are so similar, branding can have a large effect on the price that customers are willing to pay. Brands can add value to a product or service by enabling the product or service to command a higher price or higher market share than an unbranded equivalent.

A common question I get asked is how much does branding actually add to a brand’s value and consequently, can its value be measured? I came across this quote recently and liked the explanation:

“Having a better product or a larger sales force is not brand equity. Brand equity is that incremental value that accrues to a product when it is branded. Simple brand awareness is one source of brand equity. If you can get your name to pop up in people’s minds when they think of the product category, you’ve won a big part of the battle.” —V. “Seenu” Srinivasan, an Adams Distinguished Professor in Management at the Graduate School of Business in South Korea.

This diagram from The Brand Gap written by Marty Neumeier shows how brand value is a REALLY big deal. Basically, it demonstrates that if Coke sold without it being Coca-Cola the brand, it would be worth only 1/2 of what it’s really worth. It’s because of its BRAND that it is worth so much more.



Positive brand equity can help a company in a variety of ways. The most common is the financial benefit, which enables a company to charge a price premium for that brand; for example, the Tiffany brand has enough equity where a price premium isn’t just accepted, it’s expected.

Kellogg School of Management conducted a study with some of their MBA students. The professor asked the first group of students what they would expect to pay for a pair of good-quality, 18-karat gold earrings. He asked a second group how much they would pay for the same product, but added the words “from Tiffany.” He asked a third group the same question, but changed “from Tiffany” to “from Wal-Mart.” The results were striking. The average price for the unbranded earrings was $550. With Tiffany branding, the average price increased to $873, a jump of almost 60%—an increase due solely to the addition of the brand name. With the Wal-Mart branding, the price expectation fell to just $81, a decline of 85% from the unbranded example and a decline of 91% from the Tiffany brand. There is something very important to be learned from this example. Not only does the power of brand shape a buyer’s perception, “good” quality means something entirely different between brands depending on their “perceived” value.



If you have a strong brand—one that is perceived as an industry leader—you can avoid becoming a commodity. If your product or service is just like everyone else’s, then you are a commodity and competition will become a real-time issue. In that case, we compete solely on price and that drives margins down. How? By forcing us to discount or offer “free” incentives to get our customers to consider us. People don’t buy a BMW or a VW Beetle solely based upon their difference in price. Even though they are both German-made automobiles and both get us from point A to point B, the drivers of each are very different from one another. These vehicles offer us very different features, as well as vastly different brand impressions. Can you picture the driver of each in your mind? Which one are you?

The strongest brands have the biggest competitive advantage. Think about Crocs. They’re the premier brand in their space, commanding 90% of the springy-soled, plastic clog market. There have been numerous other similar products that have come on the scene trying to grab hold of this particular consumer shoe fetish, but none have been as successful. Unless you have a strong IP strategy (“intellectual property”: think copyright; think trademark; think patent), you will have competition, so being the front-runner in every possible way will be paramount.

Your brand awareness is especially important because if you are at the top of a consumer’s mind, you will be the go-to for consideration. And, we all want to hold that coveted position in the minds of our buyers because ultimately, we want them to write their check… to us. Right?

So, what can you do to begin thinking about your brand’s value? Here’s my short list:

1. Review the competitors in your space.

The first thing I would do is some competitive analysis. You want to know how your competition is showing up. You should know what they are doing worse, better, or different from your brand. Are they innovating? Do they feel like they are? Then, produce a SWOT analysis to take your own brand’s temperature then make any changes accordingly.

2. Audit your brand in print and online.

When was the last time you did anything with your brand identity? Has your customer or service suite evolved at all since then? Remember that you want to make sure your brand is keeping up with the expectation of your audience. Log onto your website as though you were your own customer. Take a tour. How does it “feel”? Do you feel good about how it represents you and your business? Is it user friendly? Is it mobile? Does it have a point of view?

3. Review your messaging.

How are you talking about your brand? Does it sound exactly how it looks? Is there enough content to support a strong point of view? Do you come across as a thought leader? If not, create a content strategy and get writing!

4. Own your .com.

Do you own your .com or is it a .net, .org., .co, or .info? Are there misspellings or hyphens in the URL because the .com wasn’t available? Bottom line, you need your .com and not a variation of it if at all possible. I had a great interview that I did for my Brand Chat Interview Series with Mark Levine, a domain investor on how having your .com can increase your brand value sometimes substantially. You can watch it HERE:

Mark Levine

5. Evaluate your prices and pricing strategy.

Do you have a pricing strategy? Where do your prices fall in relationship to your competition? Have you had price increases? Decreases? Promos? BOGOs? Do you feel your pricing is commensurate with the products/services you provide? Do you wish they were higher? There is price psychology that needs to be taken into consideration so that you aren’t priced too high or too low for your market and deliverables. Do your prices match your brand? If I were to purchase a piece of clothing at TJ Maxx, I would expect to pay less than a similar garment at Nordstrom. So you need to think about the value of your brand and price accordingly.

I hope you’ve found some food for thought in my examples and take some time to review your brand to determine its proper value. Here’s to your highly valuable brand.