Articles

Journal of the Academy of Marketing Science

, Volume 34, Issue 2, pp 224-235

Brands matter: An empirical demonstration of the creation of shareholder value through branding

  • Thomas J. MaddenAffiliated withUniversity of South Carolina
  • , Frank Fehle
  • , Susan FournierAffiliated withBoston University

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Abstract

This research responds to the attendant need for empirical evidence pertaining to how marketing affects firm performance. Using the Fama-French method, common in finance, and a leading marketplace measure of a brand’s financial equity value, the authors provide empirical evidence for the branding-shareholder value creation link. The results extend previous research by showing that strong brands not only deliver greater returns to stockholders than does a relevant benchmark but do so with less risk This finding holds even when market share and firm size are considered.

Keywords

shareholder value brand equity brand value portfolio analysis brand strategy