Brand value and firm performance nexus: Further empirical evidence

Establishing a link between brand value and firm performance is important because (1) like other forms of investment, expenditure on building brand value has to improve shareholder value; (2) it provides marketers with the necessary justification that brand investments have the required payoff; (3) it allows for brand equity to be included in the balance sheet. Previous research has provided evidence to support a positive relationship between the two variables, but they tend to be based on individual-level data. Studies that are based on secondary and / or third-party information are not rigorous in their methodology. In this paper, we use a panel data framework comprising the leading 50 US companies between 2000 and 2005 to establish the nexus between brand value and various measures of firm performance. We also utilise the price and returns model to show that brand value could provide some value-added information for future share price predictions.