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How to see the relationship between assets and liabilities of brand reputation/reputation?

Brand is an intangible asset

Brand is the intangible asset of an enterprise, and a good brand reputation will bring more attention and faster conversion to the enterprise.The quantification of a brand’s intangible assets is not a 1:1 input and output ratio. This coefficient ratio can be 1, 0.5, or 2, 4, or 8. When we can define brand value and deliver brand energy When the brand value can achieve exponential growth, this is the brand's equity.

Definition of Assets

In finance/accounting, an asset is an umbrella term for capital and property.

Assets are those formed from past transactions or events of the enterprise, owned or controlled by the enterprise,A resource that is expected to bring economic benefit to the business.Resources that cannot bring economic benefits cannot be used as assets, but are the rights of enterprises.Assets can be divided into current assets, long-term investments, fixed assets, intangible assets and other assets according to their liquidity.

The growth process of brand intangible assets

Brands are built with capital, and they are also earned with reliable service in exchange for word of mouth.There is a hidden accounting bookkeeping in a brand enterprise:

Assets are debit subjects, debit, on behalf of deposit, on behalf of growth; credit, on behalf of consumption, on behalf of reduction.

  • Borrow: Brand - Intangible Asset
  • Loans: bank deposits (for trademark registration, brand design, brand marketing promotion, etc.)

 

  • Borrow: Brand - Intangible Asset
  • Credit: Accounts payable (employee wages, supplier payables, customer care, technology research and development expenses, etc.)

Of course, our actual accounting is not like this. The brand value is not directly calculated when accounting, but:

  • Borrow: Product and service costs/fees (trademark registration, brand design, brand marketing promotion, etc.)
  • Loan: bank deposit

 

  • Borrow: Enterprise management costs/expenses (employee wages, supplier payables, customer care, technology research and development expenses, etc.)
  • Credit: Accounts Payable

If the company does not make a brand, then this step is over, and there will be no accumulation and growth of brand value.If you do a brand, it will form an increase in brand value.

  • Borrow: Brand - Intangible Asset
  • Credit: Owner's Equity - Paid-In Capital - Brand Value Evaluation (Specific products and services, the sense of value obtained by customers, the dependence and liking of the brand, and the market competitiveness formed)

Brands are over-marketed into liabilities

Our current understanding of brands is too superficial, and even equating brands and trademarks, which is a very bad thing.If you want to be an upright brand, you must have a registered trademark.But there are trademarks, perhaps just for the illegal purpose of squatting.

Packaging brands do short-term business

Some companies register their trademarks for the purpose of earning money, doing small activities, releasing a large number of press releases, doing brand encyclopedias, and collecting money. Then, the service cannot keep up, or the products cannot keep up, because of this. This kind of operation is highly profitable in itself. Once you change a trademark, it is only a few hundred dollars for trademark registration, but consumers do not understand.

Short-term brands are classifications of brands, however,Healthy short-term brands should be sub-brands under the big brands, otherwise, short-term brand reliability cannot be guaranteed.

Short-term brands absorb gold in the brand industry through the effect of the brand itself, and then walk away, and people's awareness of the brand will be discounted. This is the debt formed by the brand's excessive behavior. Bad brands themselves, If you want to repay the debt, it is estimated that you will not earn enough to spend. Therefore, the end of the short-term brand is death, and the debt damage to the parent industry of the brand needs to be repaid by the entire industry.

Overmarketed Brands

Our Advertising Law stipulates the legal operation of advertising, but it does not prevent brands from over-marketing, and excessive marketing can seize more customers and markets. If the customers and markets seized are not properly or meet quality standards, then , it will lose the brand's customers, and if the lost customer's loyalty to the brand itself is not high, then the probability of returning will be reduced,The brand will gradually lose the market.

This is the over-consumption of the brand's intangible assets, andresulting liabilities.

In the process of brand development, mistakes will inevitably occur, so at this time, correct brand public relations are needed to maintain the brand, and our current public relations behavior is chaotic or even wrong.

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