Is the Euro a brand?

Euro coinReading the depressing press coverage of the difficulties in the Euro zone, I keep hearing reference to the ‘Euro brand’. Now, I am fairly relaxed about some of the inappropriate and uninformed usage of the term ‘brand’ – there are plenty of learned and philosophical discussions about what constitutes a brand and many of them fall into the category of ‘angels dancing on pin heads.’ However there is one rule-of-thumb that I apply to qualify brands: a necessary condition to be classified as a brand is that it should be tradeable, it is an asset with a financial value.

If I was unimaginably wealthy, I could buy the Virgin or Coca-Cola brand. I don’t just mean purchase the business, but the intangible brand asset that has a value. When Kraft bought Cadbury, they were not just paying for some manufacturing plants and chocolate bar machines, they bought a basketful of brands and you can bet they had them valued most carefully. Brand valuation is a hot topic, with good reason.

You don’t have to be in the business of buying brands to be looking at their values. Brands can be licensed; indeed, one of the approaches to valuation is to estimate the cost of licensing. By this measure, even non-profits can put a value on their brand. Organizations, and charities all have the possibility of licensing the use of their brand even if they choose not to exercise it. We could put a substantial value on such brands as Oxfam, the IOC, the Salvation Army or the Scouts.

By the measure of license value we can also look at the brands of individuals. There has been discussions about whether people can be brands. By my condition of tradeability of value, they certainly can – from David Beckham to Tony Blair. And, like all brands, their value can go down as well as up.

So, we come back to the Euro: is it a brand? By my one simple condition, I would have to say ‘no’. You can’t buy or sell the intangible values of the brand – what are they and who owns them? Can you license the use of the brand? I suggest not, (though perhaps some sharp entrepreneur may have other ideas). Tradeability may be a simplistic measure, but as one simple condition to answer the question, ‘Is it a brand?’ it has worked for me.

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2 comments

  1. I would argue that the Euro is a brand.

    It has a physical presence in currency; a brand outlook in unifying countries for a common cause “trade” and it is most certainly trade-able within ForEx markets (although perhaps not for much longer… But that’s an economic argument).

    However, for the person on the street, its brand value is not very high – it doesn’t really promise them anything in and over itself.

    So while it is a brand, with a range of images, expectations and experiences attached, I would argue that it’s not a strong one…

    However, does currency need a strong brand? Or should it be the country behind it that needs the brand?

    1. Thanks for the comment, Neil. I guess my point was about defining what is a brand. If you accept my rule-of-thumb that a necessary (though not sufficient) condition is that a brand can be traded, i.e. sold, licensed or in some other way monetized, I argue that the Eueo is not a brand. I can’t buy it like I could buy, say, the Woolworth brand, and I can’t license it for use like I could with, say, the Nike brand. Sure, you can trade ‘Euros’ but that is the ‘product’ you are trading, not the brand.
      I only picked up on this as there has been some sloppy use of the term in current journalism.

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