11/14/2006

"How to Kill a Brand"

I used to think I was a lone nut, but this 24/7 Wall St. article on 'how to kill a brand' agrees:

Advertising is viewed by most shareholders as an expense. In my view, it is a capital expenditure, not terribly different than building a factory or buying equipment to build revenues, but with a very special bonus attribute...a 100% write-off in year one! Rather than a prolonged schedule of depreciation, Uncle Sam participates in the deduction, all in that first year.


Thank you. It's true: Even in highly volatile markets, the value of advertising doesn't just dissipate -- it accumulates. Witness Coca-Cola. They've been buying brand recognition in every medium they can think of for over a century, and they're paid off. But the fact that these values persist over time doesn't mean that they persist without maintenance. Let's hope, for the sake of their shareholders, that Adidas turns around their ad spending before they fall hopelessly behind.

Byrne's Marketview has moved to its own domain!


posted by Byrne Hobart at 4:26:00 PM

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