Companies of late have realized the importance of a brand and started investing huge amounts in promotional activities in an attempt to get their brand noticed by the customers. This goes to show that brands carry value. But how does one evaluate a brand? There is a dearth of appropriate brand valuation models and with the ever rising awareness of the importance of brands among companies, efforts to come up with effective brand valuation models have increased.

The word "brand" is derived from the Old Norse word brandr, meaning burn, and it was by this method that early man marked his livestock. From the branding of his livestock he moved on to branding his works.

Traditionally, a brand referred to a burn mark, reflecting the stamp of ownership. In commercial usage, the term is often used interchangeably with a trademark. The American Marketing Association defines a brand as "a name, term, sign, symbol, or design, or a combination of them intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors." The Accounting Standards Committee (ASC) recognized that a trademark was just a subset of the far broader concept of a brand. In Exposure Draft 52, the ASC pointed out that the term brand was generally used with a meaning significantly different from and wider than a trade name.

Brand is much more than a trademark or a logo. It is a promise of quality and authenticity that customers can rely on. The purpose of brand is to uniquely identify a company and its products, differentiating them from competitors. Brand enhances the perceived value, the quality and satisfaction a customer experiences.

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