The paper addresses the issue of valuating a company. The enterprise value consists of different part-values: the value of its estates, its machines, etc. According to Aaker David (1991), an absolutely important asset to be included is the value of the enterprise’s brand. This paper intends to demonstrate how to value the brand by its future cash flows, and it takes a closer look at the meaning of brand value for a company’s performance. Parallel to the enterprise value, we show how to measure brand equity with price premium. The goal of this paper is also to pose two important questions for every brand manager: “Am I a branded company?” and “What drives my cash flow, the operative business or my brand?” These questions can be answered by using two brand performance indicators: Brand Caused Earnings (BCE) and growth rate of BCE (b).

The ultimate goal of management and business strategies is to maximize the value of a company for its shareholders (Rappaport, 1986), provided that it is subject to important constraints that are executed in a legal, ethical, and socially responsible manner (Aaker David, 2001). What drives the value of an enterprise? James Anderson would answer: the right action of the ‘value merchants’ (Anderson James et al., 2007). In this work, we will not focus on what these actions may be, but on the measuring of the results of the actions. The main drivers are profitability, measured by the company’s Return On Invested Capital (ROIC), and the current and future growth rate of profits, g (Copeland, 2000; and Baldwin Carliss, 2004).

The total value of companies as business units consists of different components. One of the important value components is brand equity (Aaker David, 1991; Keller Kevin, 2003; and Kotler and Pfoertsch, 2006). Both, the company and the brand value, are driven by the same forces: profitability and growth (Shocker Allan and Srivastava Rajendra, 1991; and Shocker Allan et al., 1994). Together with the stability or predictability of changes in these components, they determine the value of the company and the brand, respectively.

To manage your company and your brand, you need information about the success of your brand strategy. We will show how to develop the company’s brand profitability and growth with a model which describes your brand position in your market in relation to your competitors.

Brand Management Journal, Celebrity Brand, The Oprah Winfrey Network, Communication Skills, American Broadcasting Corporation, Worldwide Organization, Internet Programming Media, Oprah Winfrey Scholars Program, Celebrity Branding, Entertainment Industry.