Brand Valuation of Commercial Banks in Bangladesh: An Application of Marketing Profitability

Abstract

<p><em>The competitive race of banking sector in the world economy is rapidly enforcing the importance of brand valuation. The acceptance of brand valuation has been questionable in several times due to the subjective measurement that derives from customers’ volatile perceptions. At the same time, financially focused model provides only an assessment of the economic value of brand. It is still a challenging task to compute the brand valuation depending only on financial data. Interbrand technique (2004) is one of the best approaches of calculating brand value within the community of marketing. Our valuation approach followed the A.C. Nielsen valuation model (2006) for valuing brand which is multiple of </em><em>“</em><em>Annual sales of representative brand</em><em>”</em><em>, </em><em>“</em><em>Net operating margin</em><em>”</em><em>, </em><em>“</em><em>Relative brand strength</em><em>”, </em><em>and </em><em>“</em><em>Perpetual annuity NPV discount factor</em><em>”</em><em>. This paper explores the </em><em>B</em><em>rand </em><em>V</em><em>aluation (BV) and identifies the relative position of banks based on measuring marketing contribution.</em><em> Data have been collected from first generation private commercial bank’s annual reports and analyzed by using perpetual NPV continuous discount factor. </em><em>The objective measure of BV for commercial banks was developed using Net Marketing Contribution (NMC), Relative Brand Strength (RBS) and Perpetual Net Present Value Continuous Discount Factor (PNPVCDF).</em><em> </em><em>The measures of brand valuation will ease the understanding regarding marketing profitability, brand performance and relative position in the competitive field.</em><strong><em></em></strong></p>

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“…24 As the discussion of merger and acquisition of brand equity has grew popular, it has become an important concept in the study and practice of business. In around 1980, brand equity had become an intriguing topic and research study to business community (Huang, 2015;Hasan, Ullah & Bhattacharjee, 2015). In the theory and practice of contemporary marketing (Davcik, 2013), brand equity was eventually be strategic business asset for a company.…”

Effects of marketing indicators application on brand evaluation

“…According to He and Calder (2020, p. 3) "the strength of a brand determines how much of the sales it deserves for the brand, and the stronger the brand, the higher is the revenue". International Accounting Standards (IASB) (2006) believe that the introduction of unique valuation method would be reasonable for brand valuation (Hasan et al, 2015). Wasserman (2015, p. 4) concluded that "additional reports need to be included with the current financial statements in order for brand value to be recorded separately".…”

Strategi Peningkatan Ekuitas Merek di Indonesia

“…Semenjak maraknya pembahasan mengenai merger dan akuisisi pada tahun 1980-an ekuitas merek adalah topik yang penting diulas dalam praktek maupun kajian bisnis (Huang, 2015;Hasan et al, 2015;dan Wardianto et al, 2018). Ekuitas merek ini digunakan sebagai dasar dalam menghitung goodwill dan reputasi perusahaan ketika terjadi merger dan akuisisi (Eng & Keh, 2007).…”