DESIGN: BRANDS IN THE BOARDROOM - How can the board be sure that its investment in branding is helping to deliver the bottom line?

The concept of a brand's value has never had such a high profile, and as a consequence the role the brand plays in a company's success is being ever more closely scrutinised. There are two main drivers for this scrutiny. As Hans Arnold, the head of consulting at Enterprise IG, says: "There are the shareholders who want better reporting on intangibles, such as the brand; and there is the boardroom, where people understand that brand is important and brand investment is becoming more expensive, and they want to see a return on their investment."

At the same time, the pressure on companies to perform is increasing.

Every sector is getting more crowded and markets are becoming more mature, making the brand instrumental in gaining any competitive advantage. Investing effectively in your brand can either shift more product or can allow you to increase the price of the product.

And who wouldn't like to know which part of the brand investment was helping to deliver this? As brand increases in relevance and climbs higher up the corporate agenda, it has had to start talking in a way that means something in the boardroom.

Hence the rise of tools to measure investment in brand. Interbrand was credited with starting it, back in the 80s. Now, every brand consultancy worth their salt either has their own trademarked valuation system, or is aligned to a company specialising in this area, or both.

Landor has teamed up with BrandEconomics to exploit its BrandAsset Valuator database; Enterprise IG is putting together a system that links brand with business performance; Siegelgale launched Human Brand Interaction to evaluate brand experience in November; Nucleus operates BrandDueDiligence, which measures brand issues during the pre-announcement phase of mergers and acquisitions; and McCann-Erickson is working on a "brand engagement measurement", which will launch in late May or June.

Add to that all the experts such as Brand Finance, and the choice for clients seems endless. These systems seem to be getting more complex, and given the nature of branding these days, that's hardly surprising.

Not only does a brand have more audiences, but the number of influences on those audiences is more complicated.

An FMCG brand has to worry primarily about its consumers and shareholders.

But for a service brand, the internal audience is also key. It's fairly easy to control the quality of something coming off a production line, but much more difficult to create a consistent impression of a service brand through the employees, be they telesales staff or delivery men.

So some of these valuation tools set out to measure employee perception or behaviour and feed that into the results.

Siegelgale tested the HBI framework in an internal case study of the Virgin brand. Siegelgale chose Virgin, which is not a Siegelgale client, because it is a well known international brand that offers multiple products and services across a number of channels.

Will Whitehorn, the brand development and corporate affairs director at Virgin, says: "I think these kind of methodologies are useful and Sieglegale has got a fairly practical approach to it."

However, he adds: "A lot of it was common sense and most branding can be common sense. People make branding incredibly complex."

Paul Twivy is the chief strategic planning officer for Europe, the Middle East and Africa at McCann-Erickson. He has been working with his current employer on a project that started when he was at Circus with Tim Ambler, an expert on brand equity measurement and a senior fellow of marketing at the London Business School.

"Brand measurement systems tend to work in isolation,

Twivy says. "They either look at the shareholders' point of view of brand, or produce annual employee surveys, or focus on consumers. But nobody ever joins up the dots."

Twivy is currently running a pilot of this "brand-engagement measurement

with six financial brands. "We have surveyed consumers about what aspect of the brand influences their behaviour and then asked parallel questions of employees, and we are putting that together with shareholder information, such as analyst reports,

he says.

If it works, he adds, it will have huge ramifications, because it will measure which forms of communication affect brand loyalty. It's particularly applicable to service industries, to find out what it is that triggers brand engagement.

"The pilot has shown that there's a strong link between consumer loyalty and how well they think that company treats its employees, which shows that you have to work at internal communications as much as external," Twivy says.

Enterprise IG is also working on measuring brand value across disparate audiences. Arnold says: "A corporate brand works in audience domains, such as retention of staff, and keeping business suppliers and shareholders happy. And it is possible to qualify the links between brand and business performance.

The consultancy is currently going through this process with an unnamed client.

Of course it doesn't always have to be so complicated. Esure, the insurance company, launched six months ago and has already seen a return on brand investment. It's about to sign its one millionth customer, three times ahead of forecasting.

The company is also carrying out monthly evaluations of unprompted awareness of the brand, which was created by Design Bridge, although it's too early to release findings, the consultancy's commercial director, Jon Gold, says. The trick is to create a consistent brand through all channels, he asserts.

In this new, holistic world, the concept of investing in brand can sound like a catch-all. While it clearly refers to identity design, PR and advertising, does it include internal communications? And if so, what about the money spent on human resources? This will depend on which valuation tool is used, so it must be tricky for clients to compare like with like. And how worthwhile is it to try to put a value on brand investment anyway?

If it stops great intuitive ideas getting through, that won't do the brand any favours in the long run.

Arnold is not concerned about this, saying that such valuation helps rather than hinders creativity. "The real brand leaders have the courage of their convictions. Intuition and vision you will never be able to measure.

But with research, they become better informed intuitive decisions,

he says.

However, Piers Schmidt, the chief executive at The Fourth Room consultancy, is less convinced. "You don't measure your affection for your partner quantitively, so why measure your customers' affection? There are some investments which just can't be measured,

he argues.

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