Data breaches threaten brand values, says study

BVWireIssue #222-4
March 24, 2021

intellectual property
brand value, intangible property, intangible valuation, risk analysis, company specific risk, information technology

A recent study from Infosys and Interbrand analyzes the maximum risk of brand value loss in case of data breaches. For the “100 Best Global Brands” ranked in the 2020 Interbrand list, the maximum risk amounts to a loss of 11% of brand value. “While this figure doesn’t look dramatic, it can translate to more than 100% of net annual income, depending on sectors,” the folks at MARKABLES said in a statement. MARKABLES is a provider of data designed to support the valuation of IP assets. The authors of the study suggest that brand owners should re-evaluate “hygiene” aspects of customer experience, such as cybersecurity. MARKABLES adds that brand owners should establish the value of their brands, quantify the risk they are exposed to, and rethink their approach to both risk avoidance (cybersecurity) and risk management (brand insurance coverage).

Extra: For some emerging ideas and techniques in this area, see the BVR briefing Cybersecurity in Business Valuation: Addressing the Impact of Data Breaches on Value.

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