Frequently Asked Questions
Tenet derives its annual Top 100 Most Powerful Brands from its quantitative database, the CoreBrand Index (CBI), which is based on more than 25 years of continuous benchmark tracking via surveys of nearly 1,000 different companies across 50 industries.
Each year, we survey approximately 10,000 influential decision makers on two key metrics: Familiarity and Favorability. Familiarity measures awareness of the brand. Favorability measures the perception of the brand, based on how it performs on various attributes.
Each of these outcomes has a quantifiable impact on brand reputation. Measuring both objectively is a meaningful indicator of management effectiveness and often, financial performance.
Familiarity – This component is a weighted percentage of survey respondents who are familiar with the brand being evaluated. Familiarity is rated on a five-point scale. Respondents are familiar with a brand if they state that they know more than just the company name. Familiarity scores can range from 0 to 100.
Favorability – Those respondents familiar with the corporation are then asked about three attributes that together, form a Favorability score, also on a scale of 0 to 100.
- Overall Reputation – Do you have a favorable impression of the corporate brand? What is your view of the corporate brand’s ability to drive growth over time?
- Perception of Management – What is your perception of the company’s management? How would you assess the way senior leadership leads the enterprise and engages stakeholders? Does leadership have a future-forward outlook on the competition and the market in which it operates?
- Investment Potential – Would you invest in this company? What do you think of the organization’s ability to secure future earnings and increase brand value over time?
These quantitative metrics, Familiarity and Favorability, are then combined into a composite score we call BrandPower — a standardized measure that can be used to objectively compare brands both within and across industries. BrandPower is calculated as a function of Familiarity and Favorability and then reported on a 100-point scale.
How is Tenet’s ranking of the Top 100 Most Powerful Brands unique compared to the way other companies rank brands?
Our approach is objective and based on market research. By understanding the true strength of a brand, not just its monetary value, decision-makers can gain important intelligence for creating and maintaining an advantage in the many areas that determine business success. Unlike other brand value measurements, Tenet’s BrandPower is based on quantitative measurements across a significant number of data points — as opposed to subjective industry-panel assessment traditionally used to determine a brand’s monetary value. Our method allows brands to be evaluated objectively, providing new and valuable information for investors and brand stewards as they determine a brand’s ability to impact business results.
Brand Valuation is becoming a more common practice among many brand-consulting firms. Is Tenet Partners able to conduct specific brand valuations for companies?
Yes. Our methodology is completely transparent and free of “black-box” judgments. Instead, we leverage reliable, stable market research and BrandPower data, and couple both with financial data from widely accepted business sources. With more than 25 years of proven research data, we can ensure consistent input to our model. This statistical model identifies the contribution of the brand to the company based on market research and regression models, and then evaluates it in the context of financial impact to determine brand dollar value.
Tenet’s Brand Equity Valuation is expressed in two ways:
- Market Value: A brand’s market value rises and falls depending on a company’s ability to achieve its key business objectives. This number tells the executives responsible for building the brand how hard that brand is working to build value for the company – how much of a contributor the brand is to a company’s success. This is an ideal number for a company’s KPI dashboard and a reliable measure of brand performance in the context of a company’s overall financial health.
- Dollar Value: The dollar value of a brand is a result of multiplying the percentage impact of the brand by the company’s market capitalization. As the company’s overall enterprise value fluctuates, this number can change day-to-day. It helps to communicate the brand’s asset value to senior leadership and other constituencies, ensuring that the brand is properly accounted for in M&A activity, royalty and licensing cases, along with additional reporting vehicles.
Understanding the market value and the dollar value of a brand can be useful in many ways. The percentage a brand contributes to a company’s success is important to brand stewards because it reveals objectively, how hard the brand is working to create value. The dollar value of the brand is important to senior management, as it identifies the asset value of the brand. As a result, leadership can better understand a brand’s worth to the company, and communicate effectively its value to shareholders and to other critical audiences.
Well-known brands such as Lyft and Snap are not part of the Top 100 Most Powerful Brands of 2019. Why?
The brands listed on our Top 100 Most Powerful Brands ranking must meet several criteria to be considered. They must be a corporate brand (not a product or divisional brand), publicly traded in the US and tracked in the CoreBrand Index for 3+ years. Brands such as Lyft and Snap have not met these criteria, and have not yet been tracked in the CoreBrand Index for three years or longer.