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Personal Brand Valuation

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Personal Brand Valuation

What are the main factors driving personal brand value? And, how do these factors increase or decrease value over the course of a person’s lifetime? These are the questions we set out to answer with Personal Brand Valuation.

Largely owing to Interbrand’s work over the past 26 years, the understanding of a brand – and of its value – has changed dramatically. In 1984, brand was basically synonymous with logo. Interbrand changed the game when we pioneered the concept of Brand Value, which allowed us to determine an accurate measure of a brand’s worth to business strategy – something we certainly know the importance of. Knowing the actual monetary value of a brand can play a major role in helping to guide the decision-making of a company as its leaders think about their plans for the future of the business.

Why can’t the same be true for personal brands, such as celebrities and athletes? They drive value in the same manner as any other brand and understanding how to leverage them is more important today than ever before.

With this in mind, Interbrand pioneered Personal Brand Valuation – a unique methodology that provides a way to value a personal brand with the same rigor that we have used for 26 years in our valuations of corporate brands.

Personal Brand Valuation (PBV) has utility for both the owner of the personal brand and the corporation seeking to align with an endorser. It can be used to determine the current and future value a personal brand generates for itself or to determine the value a personal brand will generate for a corporate/product brand.

1. PBV - Personal Earnings Estimate Used to forecast the earnings of a personal brand, the Personal Earnings Estimate has a variety of uses, including enticing top talent in the sports or business worlds. It

can also be used by talent management to understand the brand impact of their clients’ career decisions, allowing optimization of potential future earnings.

Step One: Determine the Sources of Income Understand the the potential sources of income, both now and in the future (i.e. salary, endorsements, product sales, etc.)

Step Two: Understand the Drivers Determine the effect of different variables on those income streams (e.g. choosing certain film roles, playing for a particular franchise, selecting an employer).

Step Three: Determine Brand Strength By understanding the the current strengths and weaknesses of the brand in question, we can determine the probability of our earnings estimates. For example, a celebrity prone to scandal will be less likely to land starring roles, earn awards, and secure endorsements. All of which will lower potential earnings.

Step Four: Simulate Simulate all possible outcomes to determine the maximum, minimum and average earnings potential given all possible

scenarios (i.e. number of championships or Academy Awards won over a career).

2. PBV - Organizational Earnings Estimate This is used to forecast the impact of aligning a corporate or product brand with a personal brand. By understanding the value of different personal brands, decisions can be made on which personal brands to align with and what level of investment to make in those partnerships.

Step One: Understand the Opportunity Estimate market potential for the product/corporate brand in question and develop a baseline earnings estimate by examining existing research and financial forecasts.

Step Two: Determine Role of Brand Understand the role of the personal brand in driving incremental demand for the product/ corporate brand among each target segment either through custom or existing research.

Step Three: Determine Brand Strength By understanding the the current strengths and weaknesses of the brand in question, we can determine the probability of our earnings estimates actually coming to fruition.

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The final outcome of either approach is a dollar value that the brand generates. However, the number we arrive at is not the entire story. From this model, we can determine the key drivers of personal brand value are and answer questions that might arise when an organization or celebrity is weighing different scenarios to determine what is best for both brand and bottom line.

Personal Brand Valuation could be used to:

- Help free agents decide which franchise to align themselves with in order to maximize their brand value and earnings

- Provide celebrities with a process which allows them to weigh different endorsement opportunities based on the likely effects on their brand values

- Aid athletes and other celebrities in their negotiations with potential endorsers

- Give sports franchises a rigorous methodology they can use to attract players by demonstrating the value of playing for their franchise/in their market

- Provide corporations with quantifiable data that will help them in choosing the right celebrity to align with their brand

- Provide an accurate measure of a personal brand during endorsement contract negotiations.

Much like we did in 1984 with corporate brand valuation, we’re changing the way people think about brands – but this time, about their own brands. ■