Why Is Brand Value Important for Trademark Professionals?

This blog post was  written by  Brand Value Special Task Force Co-Chairs Melody Schottle, Exxon Mobil Corporation (United States), and Doug de Villiers,  Deloitte (Africa). 

The importance of intangible assets-and, in particular, brands-is now widely appreciated by professionals across a range of disciplines, including finance, marketing, accounting, and, of course, legal. And yet often these disciplines use different definitions, and even have different understandings, of key concepts. What do we mean when we use terms such as “brand value,” “brand equity,” or “brand evaluation” and how can we improve our understanding of these concepts?

Since March 2018, INTA’s Brand Value Special Task Force has been studying these questions, and reviewing the latest thinking around brand value and brand equity, as discussed in ISO 20671: 2019 “Brand evaluation-principles and fundamentals” published in March 2019. The Task Force comprised 14 active participants who brought a range of perspectives, including legal (in-house and law firm), finance, valuation, and marketing. 

As Co-Chairs of the Task Force, we found these diverse insights both fascinating and helpful and are grateful to all the participants for their involvement as well as to other individuals who contributed to the work of the Task Force. The result is a comprehensive and practical report, the Brand Value Special Task Force Report, with 20 specific findings as well as seven Expert Insights and eight appendices, including a checklist of legal considerations for brand valuation.

Each of the report’s 20 findings is supported by a number of recommendations for INTA consideration and action. For example, we recommend that INTA review its definition of “brand” to better demonstrate the financial contribution of brands to businesses and also develop definitions for “brand value” and “brand equity.” We also recommend that INTA engage with the International Organization for Standardization (“ISO”) to bring trademark practitioners’ perspective to the legal considerations and dimensions of the relevant standards.

In the report we also explore how INTA can play a proactive role and be a resource for its members and for Intellectual Property (“IP”) Offices, as well as for professionals in finance and marketing and those in accounting, auditing, banking, insurance, and related institutions that develop certification programs on IP or brand valuation. In addition, there are other stakeholders involved in brand valuation and brand evaluation exercises. The diagram extracted from the report below, provides a schematic reference of a non-exhaustive list of stakeholders involved in the brand valuation and brand evaluation ecosystem.   

While much of the report focuses on tasks for INTA itself, we have also identified several recommendations for both in-house and law firm practitioners in their day-to-day work. The former can work together with finance and marketing colleagues to learn about and coordinate approaches to brand valuation and evaluation, providing a legal perspective where appropriate. The latter can increase competencies in this area to better support their clients in IP and mergers and acquisitions by learning about topics such as brand valuation and evaluation. The report provides specific recommendations on how to achieve this.

While different professionals bring diverse perspectives and sometimes seem to speak different languages, the multi-disciplinary approach taken by this Task Force demonstrates the common interests these diverse groups share in this area and the vital role that trademark practitioners play in brand valuation and evaluation exercises. In particular, in the knowledge-based economy, and with consumer behavior constantly changing, we are all striving in different ways to measure how consumers interact with brands and the impact that this has on organizations. We are confident that this report, and the recommendations contained in it, will be useful to members and others as they navigate these challenges and look forward to the implementation of some of the report’s recommendations through the work of INTA’s new Commercialization of Brands Committee and the Building Bridges Committee.