Lewis silkin Brand Academy 2013 - Building valuable brands presentations

Brand Academy y20132013

Building valuable brands

Gil C L i Silki

INTRODUCTIONGiles Crown, Lewis Silkin

GOING UP?

$700,000 M

Apple Market Cap Apple Brand Value

Interbrand dataYcharts - Morningstar NASDAQ data

$500 000 M

$600,000 M

$400,000 M

$500,000 M

$300,000 M

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Enduring brand value?

$250,000 M

Samsung Market Cap Samsung Brand Value

Interbrand dataYcharts - Morningstar OTC Markets data

$200,000 M

$150,000 M

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Profit before brand?

MUST IT COME DOWN?

$40,000 M

Dell Market Cap Dell Brand Value

Interbrand dataYcharts - Morningstar NASDAQ data

$30,000 M

$35,000 M

$25,000 M

$15,000 M

$20,000 M

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131313131313131313131312121212121212121212121111111111111111111110101010101010101010100909090909090909090908

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A lost brand?

$70,000 M

Nokia Market Cap Nokia Brand Value

Interbrand dataYcharts - Morningstar NYSE data

$50 000 M

$60,000 M

$40,000 M

$50,000 M

$30,000 M

$10 000 M

$20,000 M

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A brand left behind?

Intellectual Propertyp y

ProductInnovation

&Heritage

Valuable Trust &

Transparency

Heritage

brandProfitConsumer

engagement

AllureReputation

Mik R h I t b d

BEST GLOBAL BRANDS 2013Mike Rocha, Interbrand

@mikerocha73@mikerocha73

www mobro co/www.mobro.co/mikerocha

Agenda

1. Best Global Brands 2013 overview1. Best Global Brands 2013 overview

2. Methodology and applications

3. How can you be a brand leader?

Best Global Brands 2013 i2013 overview

11

A few statistics

Top 10 Brands

IBM+4% 78 808 $m

McDonald’s+5% 41,992 $m

+4% 78,808 $m

Google+34% 93,291 $m

Samsung+20% 39,610 $m

Microsoft+3% 59,546 $m

Apple

Coca-Cola+2% 79 213 $m

Apple+28% 98,316 $m

Intel–5% 37,257 $m

GE+7% 46,947 $m

+2% 79,213 $m

Toyotay+17% 35,346 $m

Methodology and li iapplications

22

Interbrand brand valuation methodology

AuthenticityBrand Strength

RelevanceClarity Relevance

Diff ti ti

Clarity

C it t DifferentiationCommitment

EXTERNALINTERNAL

ConsistencyProtection FACTORSFACTORS

PresenceResponsiveness

Understanding

Brand valuation applications

Brand Management

Strategy/ Business

Case

Financial

How can we grow the

value of our

Which strategy will deliver the

What is our brand worth

today?brand? best return?

y

How can you be a b d l d ?brand leader?

33

HAVE CONVICTION NURTURE YOUR CULTURE

SURRENDER DELIVER AN SURRENDER CONTROL

DELIVER AN EXPERIENCE

HAVE

Trust Speed Working Purpose

HAVE CONVICTION

| Best Global Brands 2013 | Amsterdam | #BGB201322

Thought leadership platforms

Trust Speed Working Purpose

Currently, Smarter Planet acts as a unifying belief and innovations platform for the businessbelief and innovations platform for the business

• Positions IBM as ‘chief problem solver’Positions IBM as chief problem solver

• Bigger than the company

• A unifying idea

IBM has reinvented itself many times. But through it all, its DNA, its soul

i d i t t IBM' t remained intact... IBM's most important innovation wasn't a technology or management system. Its revolutionary idea was to define and revolutionary idea was to define and run a company by a set of strongly held beliefs.

Sam Palmisano, Former Chairman & CEO

.

Trust Speed Working Bigger Purpose

HAVE HAVE CONVICTION


NURTURE NURTURE YOUR CULTURE


Google culture Nurturing the people in your organization doesn’t require expensive perks or touchy-feely gimmicks. It’s about motivating, engaging and listening – and it can work for anybodywork for anybody

You don't need a lot of money to do what Google has done. If you give people freedom, they will amaze you.

Laszlo Bock, Google’s SVP of People Operations

2 5m2.5m

NURTURE NURTURE YOUR CULTURE


Are you an IBM’er?

6 yearsIts genius lies in fostering innovation through co-

i i h i l 6 years creation with its employees, suppliers, partners and customers.

Mark Fidelman, Forbes

Surrender control – co-creation

SURRENDER SURRENDER CONTROL

SURRENDER SURRENDER CONTROL

DELIVER AN DELIVER AN EXPERIENCE


Apple’s obsessive attention to detail is a unique hallmark of their brand’s experiencehallmark of their brand s experience

• Product – setting the tone for the brand experienceProduct setting the tone for the brand experience

• Details matter

I love the process of unpacking something. You design a ritual of unpacking to make the product feel

i l P k i b h i special. Packaging can be theatre, it can create a story.

Sir Jony Ive, Senior VP of Design, Apple

Attention to detail has been applied to all touch points, particularly retailpoints, particularly retail

• Early reliance on big box Early reliance on big box computer and electronics stores

• Poorly trained staff and ill-• Poorly trained staff and illmaintained Mac sections

• Needed to get closer to • Needed to get closer to customers

A l ’ di ti i ti i • Apple’s disruptive innovation in retail programme was to focus on the brand-led experience

Ambassadors needed clear guidelines on how to deliver a brand-led servicedeliver a brand led service

Appears seamless but Apple’s behaviour requires:• Internally codified behaviours

• Rigorous training

• Not externally communicated• Not externally communicated

Genius Principles

Approach ProbePresentPresent ListenEndEnd

HAVE CONVICTION NURTURE YOUR CULTURE

SURRENDER DELIVER AN SURRENDER CONTROL

DELIVER AN EXPERIENCE

Thank you!Thank you!

www.mobro.co/mikerochamikerochaMike RochaGlobal Director, Brand Valuation

[email protected]

TRUST & TRANSPARENCY –Anthony Mullen, Forrester Research

TRUST & TRANSPARENCY THE UPCOMING CHALLENGE

Trust & Transparency – the i h llupcoming challenge

A th M ll S i A l tAnthony Mullen, Senior Analyst21st Nov 2013

@ant_mull

Please tweet us your questions:Please tweet us your questions:

Trust takes years to earn but it can beTrust takes years to earn but it can be destroyed in seconds

1991 - "How can you sell this for 2009 Worst Family Brand1991 How can you sell this for such a low price?", I say, "because

it's total crap."

2009 - Worst Family Brand 2011 - Worst UK Airline2012 - Worst European Short-Haul Airline

© 2012 Forrester Research, Inc. Reproduction Prohibited 41

Be Real or Be RejectedBe Real or Be RejectedTHE ERA OF CONSEQUENCES

After 30 years of indulgence, consumers, businesses and governments are rebuilding the marketplace on a firmer foundationfirmer foundation.

Trust has become a cornerstone value.Trust has become a cornerstone value.

The prevalent skepticism that makes trust difficult to achieve and maintain also makes its achievement more powerful.

Brands face a choice – be real or be rejected.


The Window of Opportunity

‘Covert’ Advertising

Maturing Legislation Greater

AutomationAdvertising –no real public

awareness

Public Awareness

& Privacy 2.0

Automation &

Transparency

pre 2009

2009 -2011

2013 -2015 2016+2009 2011 2015

3 killer use casesShow me everythingDelete everything Move everything

Risk Profiles – 3 responses to theRisk Profiles 3 responses to the ePrivacy Directive


New tools give consumers more power toNew tools give consumers more power to track and control their data

Personal Identity Management • Digital Identity Managers• Digital Identity Managers• Reputation and Data Removal

Management• Personal Data Aggregators

>45 sites !gg g

• Specialized Data Vaults• Privacy & arbitration tools• Scoring / Trust / Value Sco g / us / a ue

Mechanisms• Preference Management• Quantification of self


Consumers don’t trust advertisingConsumers don t trust advertising


WEBSITESTAFF

ADVERTISERS

WEBSITEAPPLICATION

STAFF

GOVERNMENTPUBLISHER

BRANDPUBLISHER

SERVICEAGENCY

CONSUMERS HARDWARE

Within given context a recipient TRUSTS a provider for performing an action and realizing the result that

corresponds to a recipients goal


It’s possible to come back from beingIt s possible to come back from being ‘crap’ but it takes honesty


Brands have tools for managingBrands have tools for managing reputation and trust


Digital and social activities provide anDigital and social activities provide an audit trail of behavior from both consumers and brandsconsumers and brands

Sharing Economy Social Platforms


Allowing for richer models thanAllowing for richer models than reputation



The Window of Opportunity

Legislation Greater

Automation& Privacy

2.0

Automation &

Transparency

?use technology to really UNDERSTAND and SERVE the

customer and do so in a 2013 -2015 2016+?RESPONSIBLE way that engenders

TRUST and LOYALTY

2015

Thank youThank youAnthony Mullen

ll @f [email protected]+44 (0)207 323 7733@ant mull@ant_mull

BUILDING BRAND VALUE WITH Marcus Taylor, Venture Harbour

BUILDING BRAND VALUE WITH DIGITAL MEDIA

Building Brand ValueBuilding Brand Value With Digital MediaWith Digital Media

Why do we care about building “brand value”?

“Brand Building”Brand Building“Branding”

“Build Brand Equity”= “Improving our reputation”

Build Brand Equity“Brand Enhancement”

Your reputation precedes youou eputat o p ecedes youIf it’s positive, much of your work is done for you.

Why build brand value using digital media?

It’s where the eyeballs areIt s where the eyeballs are

It’s where conversations & buying decisions are taking place.

If we don’t our competitors willIf we don t our competitors will

Long Term

Friends & FamilyColleagues

Professional IntimateProfessional Intimate

One Night StandsBrands

Short TermShort Term

Credit: Mat Clayton

Long TermThose we trust the most...

Friends & Familyare recommending (through likes, tweets, and other social signals)…

ProfessionalI iIntimate

BrandsTh t t th l t

Short Term

…Those we trust the least

Short Term

Credit: Mat Clayton

H d d it ff ti l ?How do we do it effectively?

“If one cannot increase the supply of a resource, one must increase its yield” – Peter Drucker

The Lo er Yo r Marketing B dget theThe Lower Your Marketing Budget, the Smarter Your Digital Strategy Must Be.

Lower budgets can be a blessing in disguise. They force you to think about1:many (viral) marketing opposed to1:many (viral) marketing, opposed to the easier 1:1 marketing options.

Quality x Quantity

Red Bull own a media company with 135 staff producing branded content. Their official video content has been viewed over 700,000,000 times.

Create conversions around the brand, not necessarily about the brand.

Emerging opportunities & innovation

Mobile advertising is Currently ~1/3rd of the costof desktop advertising.p g

Huge opportunity for cost Effective content distribution.

Buzz + Advocacy

Most brands are great at building buzz online, but struggle with advocacy

What are you doing to ensure your brand is gettinginvolved in conversations around yourinvolved in conversations around your products / services – and is it enough?

Thank youThank you

INDEPENDENCE INNOVATION Kelvin King, Valuation Consulting Co

INDEPENDENCE, INNOVATION AND TRANSPARENCY

INDEPENDENCE INNOVATIONINDEPENDENCE, INNOVATIONTRANSPARENCY

KELVIN KING, MANAGING DIRECTOR

[email protected]

STRUCTURE PLANNING & VALUATION

Privileges of ownership

What is being transferred, definition and identification

Transfer part of rights

Lowest defendable scenarios Lowest defendable scenarios

Valuations for exit

Licensing from IP HoldCo

STARTING AT THE TOP AND TRYING TO BUILD DOWN

BRAND VALUATION

THE LAWS OF PHYSICS AND VALUATION SUGGEST THAT THIS IS

NOT POSSIBLE

Awareness, perceptual attributes, attitude, loyalty, strategies and, p p , , y y, g

management; just a few of the due diligence areas of examination

alongside financial and economicg

ACCOUNTING STANDARDS

The US FASB has created a list of what it considers to be a firms intangibles:

Market‐related Trademarks, trade names, service marks, trade dress, newspaper mastheads, internet domain

names.

Customer‐related

Customer lists, customer contracts, customer relationships, customer agreements.

Artistic related

Ballets, books, plays, articles, other literary works, musical words, opera, pictures, photographs,video and audio‐visual material.

Contract‐based

Licensing agreements, advertising or service contracts, lease agreements, construction permits,operating and broadcast rights, employment contracts.

Technology‐based

Patented technology, computer software, unpatented technology, databases, trade secrets,secret formulae

OCCASIONS FOR VALUING BRANDS

Mergers & Acquisitions Mergers & Acquisitions

Portfolio review and risk assessment

Arrange a loan – securitisation

Tax purposes

Licensing

Balance Sheet

Joint Ventures and Technology Transfer

Pension deficits

Selling your IP

Distress

WHY ARE WE VALUING?

Tax Valuation and Open Market Value

Fair Value

F i M k V l Fair Market Value

Commercial Value

Investment Value Investment Value

Owner Value

TOOLS

Howmuch? The determinants for discounted cashflow modelsHow much? The determinants for discounted cashflow models

Gross Profit Differential – Premium Prices/Premium Profits/

Excess Profits

Relief from Royalty

USEFUL LIFE

How long for (time periods)?How long for (time periods)?

Physical Lifey

Functional Life

Technological Life

Economic Life

Legal Life

LICENSING

Many factors affect licensing and royalty rate advice

Deal structure (term, cash, profit etc)

Exclusivity

Relative risks

Investment rates of return

Commercial relationship between parties (fair value is not fair market value and neither is open market value)

Arms length requirements – HMRC and Transfer Pricing

THE LICENSEE/PURCHASER & LICENSOR/VENDOR

Four Calculations or Steps – 'can Kelvin count'

1. Intrinsic value of Vendor or Licensor

2. Intrinsic value of Purchaser or Licensee

PLUS

1. Intrinsic value of Vendor or Licensor

2. Intrinsic value of Purchaser or Licensee

The capital values calculated are an essential step to calculate royalty rate or valuation

K l B L h F h H d d C ti

DO ETHICS ADD TO OR SUBTRACT Karl Bygrave, Lush Fresh Handmade Cosmetics

FROM THE VALUE OF A BRAND?

LUSHLUSHFRESH HANDMADE COSMETICS

Do ethics add to or subtract from the value from the value of a brand?

Karl Bygrave, Director,Lush Fresh Handmade Cosmetics

The original Body Shop team (clockwise): Mark Constantine(clockwise): Mark Constantine, Anita Roddick, Deb McCormick

© 2013 Lush Fresh Handmade Cosmetics


The 10 Company Rules:

1 Value people before profit1. Value people before profit

2. Develop & promote talent from within: 'opportunity hangs in the air’

3 Take responsibility for our environment3. Take responsibility for our environment

4. Value and serve our customers

5. Benefit from the use of new technology5. Benefit from the use of new technology

6. Increase creativity and sales opportunities

7. Create a balanced and profitable business7. Create a balanced and profitable business

8. Contain staff and space additions

9. Behave ethically9. Behave ethically

10. Communicate effectively: 'We need to care about each other and help others'


LUSHLUSHFRESH HANDMADE FRESH HANDMADE COSMETICS

91

What are ‘ethics’ for Lush?What are ethics for Lush?


How do we have an opinion?How do we have an opinion?


Charity Pot

• We have donated over £1.3m since 2007I 2012 d d £343 895 37% 2011• In 2012 we donated £343,895, +37% on 2011

• In the last 12 months we have donated to 133 groups

“ M k f l t i id d t k i th t“…Makes me feel great inside and out knowing that I’m helping others while helping myself ” online customer review

Buying/ Slush Fund

Our Ethical Buying team:

© 2013 Lush Fresh Handmade Cosmetics94

Transport Policy

• We aim to air-freight less than 5% in weight of the raw materials we import.p

• From February 2009 we asked our staff not to take any UK mainland domestic flights. We have gone from 122 return flights a year to zero.

• We tax ourselves on flying – for every tonne of CO2 y g yemitted when we fly, we pay £50.

More than just campaigning

• Our first all female shop opened in• Our first all female shop opened in Jeddah in March this year

© 2013 Lush Fresh Handmade Cosmetics95

Does everyone believe in Does everyone believe in everything?


Are we doing this to build the Are we doing this to build the business?


Why do the public know about our ethics?


Do we upset more people than Do we upset more people than we appeal to?


Do ethics add to or subtract from Do ethics add to or subtract from the value of a brand?


Thank YouThank You




Gil C L i Silki

QUESTIONS?Giles Crown, Lewis Silkin

© 2009 Deloitte Touche Tohmatsu



Lewis silkin Brand Academy 2013 - Building valuable brands presentations

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