High-Profile Brands Have Low Market Value Problems


Highly Recognizable Brands Can Still Be Weak: A study by CoreBrand examined three companies that have highly recognized brands but low market capitalization values. Outside factors such as a lack of product diversity, weak financials or a poor economic environment all play a part in decreased market cap values.

CoreBrand ratings are derived from annual surveys of more than 10,000 senior business decision makers. The companies studied were La-Z-BoyChiquita Brands International and Ruby Tuesday. Findings for each, interpreted by James Gregory, CEO of CoreBrand, are as follows:

  • La-Z-Boy: With a CoreBrand power score of 54.7 and a CoreBrand equity of 16.5% of market capitalization, La-Z-Boy’s brand is comparable to megabrands like GE and Microsoft, says Gregory. However, La-Z-Boy’s image makes it difficult to expand into other product markets. So while GE’s equity of 16.5% translates to $31.1 billion of market capitalization value, La-Z-Boy’s equity only translates to $100 million of market capitalization. “Product diversification is necessary for this brand to experience any long-term growth,” he says. 

  • Chiquita Brands International: Although Chiquita has a high power rating of 49.9 and a high CoreBrand Equity of 13.9% of its market capitalization, this only translates to a brand value of $50 million. Already well-known as a producer and distributor of bananas, Chiquita, says Gregory, could benefit from efforts to broaden its brand identity to focus on its other products.

  • Ruby Tuesday: With a power rating of 35.0 and a equity of 12.1%, Ruby Tuesday’s corporate brand is only valued at $50 million. “The company has made numerous attempts to move into the higher-quality menu dining segment,” says Gregory. Still one of the largest casual dining chains in the U.S., the company needs to create an advertising and communications campaign that stands out from the competition, “and it needs enough media spend behind it to convince customers of the changes that have taken place,” says Gregory.

Source: CoreBrand

 




Comments Off

Deals of the Week

Get $150 Off PR News' Media Relations Conference

 media_relations_banners_180x150_ep

Join us on December 11, 2014, for PR News’ essential Media Relations Conference, taking place at the National Press Club in Washington, D.C. You'll learn from top PR professionals how to amplify your organization’s messages through positive coverage in traditional media and through your own branded content initiatives.

Use code “150off” at checkout.

Get $50 off PR News' Media Relations Guidebook


book-mediarelations-180x150

This 8-chapter resource contains practical implications for some of the most innovative developments in media relations, including the technologies, methodologies and mannerisms that determine the ecosystem in which PR pros practice this essential part of their craft.

Use code “50off” at checkout.

Save $100 on a PR News Subscription



Let PR News become your weekly, go-to resource for the latest PR trends, case studies and tip sheets. Topics covered include visual storytelling, social media, measurement, crisis management and media relations.

Use code “SUBDEAL” at checkout.

Comments are closed.