Journal of the Academy of Marketing Science

, 26:260

Exploring the brand value-shareholder value nexus for consumer goods companies


  • Roger A. Kerin
    • Southern Methodist University
  • Raj Sethuraman
    • Southern Methodist University

DOI: 10.1177/0092070398264001

Cite this article as:
Kerin, R.A. & Sethuraman, R. J. of the Acad. Mark. Sci. (1998) 26: 260. doi:10.1177/0092070398264001


It is generally claimed that brand names are a corporate asset with an economic value that creates wealth for a firm’s shareholders. However, the scholarly literature has neither provided a comprehensive theoretical basis for this claim nor documented an empirical relationship between brand value and shareholder value. This exploratory study describes a rationale for, and documents, the statistical strength and functional form of a brand value-shareholder value relationship for publicly held consumer goods companies in the United States. A theoretical argument supportive of a positive relationship between a firm’s accumulated brand value and market-to-book (M/B) ratio was empirically validated. However, even though firms with higher accumulated brand values have higher M/B ratios, the functional form of the relationship was found to be concave with decreasing returns to scale. Theoretical and managerial implications of these findings are outlined, as well as study limitations and directions for future research.

Copyright information

© Academy of Marketing Science 1998