World IP Day: The Strategic Value of Brands

Published: May 15, 2020

Celia Lerman Lerman & Szlak, Buenos Aires, Argentina INTA Bulletins Committee - Latin America Subcommittee

On April 27, INTA and the Chilean National Institute of Industrial Property (INAPI) co-hosted a virtual roundtable in honor of this year’s World Intellectual Property Day, entitled “The Strategic Value of Brands.” The main focus of the event was the recent INTA Brand Value Special Task Force Report. 

The event featured INAPI National Director Loreto Bresky; INTA’s Latin America and the Caribbean Chief Representative Officer José Luis Londoño; and from INTA’s Brand Value Special Task Force, Gustavo Giay, Marval O’Farrel Mairal (Argentina). 

Opening the meeting, Ms. Bresky and Mr. Londoño stressed the importance of the economic value of trademarks and the macroeconomic implications in the region. Shortly thereafter, they introduced Mr. Giay, who discussed the research, findings, and recommendations of the “Brand Value Special Task Force Report” crafted by a multidisciplinary team of INTA members and non-members from various disciplines. Mr. Giay explained that the report was developed as a key document to further INTA’s 2018–2021 Strategic Plan, related to the business value of brands, brand valuation, brand evaluation, and brand equity—aiming to provide insight on brand valuation procedures and their implications on financial and legal matters.

The report addresses the challenges of brand valuation, by focusing on how value ecosystems work, and how INTA has an opportunity to bring clarity to the definition of brand value, noted Mr. Giay. Speaking about brand value, brand professionals often only consider its financial and economic aspects, he said, seeing brands as intangible assets whose current value needs to be determined by objective means. However, a financial-only approach lacks the marketing and consumer-oriented perspectives that are necessary to fully discover the real value of a brand in the market. At its core, the report brings a unique perspective by considering brand equity—understood as the evaluation process of subjective aspects present on consumers’ minds—and marketing indicators while providing objective and transparent valuations of such assets. 

At the time of the report, Mr. Giay said, there were only two international standards: (1) ISO 10668:2010 Brand Valuation specifications, which center around financial and monetary aspects of brand value; and (2) ISO 20671:2019 Brand evaluation specifications, which focus on non-financial indicators to determine brand dimensions, such as the performance and strength of a brand in the market, and ultimately, the brand’s perceived value by consumers. While these brand evaluation rules were issued recently, they are a promising approach to a more detailed examination of a brand’s current value.

Given that brand value is a crucial element to these operations, this report is uniquely beneficial to brand professionals whose practice involves mergers and acquisitions (M&A), licenses, financial reports, bankruptcy and reorganizations, taxes, litigation, and finance and securities, given that brand value is a crucial element to these operations. Moreover, Mr. Giay highlighted that there will be increased demand for brand valuation in the future, especially in the M&A sector, and summarized the Task Force recommendations for both in-house professionals and law firms. 

On a final note, Mr. Giay explained that the report has an international approach, and therefore does not provide local and national specifics, such as tax implications based on brand value and other regulations that would need a case-by-case study.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.

© 2020 International Trademark Association