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Brand Valuation: Spain's Tourism Brand

Why and how to put a value tag on a country brand like Spain
by

Julio Lopez Astor

on 30 October 2013

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Transcript of Brand Valuation: Spain's Tourism Brand

Brand role spectrum
High
Low
Emotional
Feeling
Perceptions
Intangible
Not verifiable
Functional
Thinking
Facts
Tangible
Verifiable
Uninportant
0%
Not that important
25%
Balanced
50%
Quite important
75%
Very important
100%
Spain’s Tourism Brand
INSTITUTO
DE TURISMO
DE ESPAÑA
>
Brand valuation: why and how
(brand role and brand strength)
Examples of high brand role
Brand Strength
How to find out the brand role
2 methodologies:
Based on DD’s (Destination Drivers):
DD's are determined based on market studies
Relative weight of each DD is established
The brand role is established qualitatively for each DD.
The Brand Role is determined by weighted average.
BPToA (Brand-Price Trade-off Analysis
Selected DD’s
Safety (terrorism, crime, etc.)
Welcoming atmosphere
Gastronomy, cuisine
Authenticity, respect for traditions
Well kept environment
Affordability
Cultural heritage
Quality beaches
Variety of offerings(shopping, leisure, sports, kids, etc.)
Good weather
Lodging quality
Nature / landscape
Good infrastructure/roads/health services
Exotic, differential factor
Closeness, duration of travel
Qualitative evaluation
The MARKET dimension has been evaluated according to mostly quantitative criteria
The Brand dimension has been measured according to 9 parameters, most based on subjective variables
LEADERSHIP
The dimension LEADERSHIP has been evaluated according to cuantitative and qualitative criteria.
COMMUNICATION
The dimension Communication has been measured according to quantitative parameters
Brand Role
MARKET
Final Result on the MARKET dimension
Spain leads, but not by much
Brand Relationship
www.tourspain.es
how much is our brand worth?
Why meassure
brand value
Why brand value matters
Brands are gaining a higher share of companies' assets

Governments and therefore countries are not an exception: in the global market and with the emergence of Internet and social media, brand equity outweigths product and price as purchase drivers
To correctly manage a brand it is essential to understand how exactly does it contribute to the company's (or country's) bottom line and how does it compare to its competitors brands (how is it positioned?)
Cost approach: how much has been invested in the developement and positioning of the brand.
Doesn't really tell us anything about the brand's contribution to the bottom line and to the competitive positioning of the country

Market approach: by comparing a brand to it's competitors with established brand values and producing a relative multiplication factor.
Not useful for Spain's tourist brand, since there is not a comparable country brand in this industry with an established brand value

Earnings approach: projecting cash flow in the future, finding out brand share in cash flow generation and discounting the resulting amount to present value, using the company's (country's) cost of capital.
Although full of pitfalls, this is the approach we used.
Possible approaches to brand valuation
Need to determine the role the brand plays in purchase decisions and its strength relative to other brands
Brand contribution to bottom line and competitiveness
Overall Brand Role = Σ Brand role for each DD =
31,77%
BPToA
Spain does have a very strong brand in this segment of the market
www.spain.info
Full transcript