Jones Journal - Spring 2013

Page 19

3. How, if at all, do brands contribute to shareholder value? VM: What do IBM, Coca-Cola, American Express, Wells Fargo, Walmart and Procter & Gamble have in common? They comprise over 70 percent of Warren Buffett’s portfolio. In 2009 some marketing scholars published a large-scale study to understand how brands contribute to a firm. They found that strong brands decreased cash-flow variability and increased customer loyalty, quality perceptions and market share. All of these in turn increased the firm’s long-term value as measured by its stock price. It’s my opinion that nobody understands this better than Warren Buffett.

Left to Right: Robin Tooms ’04, Vikas Mittal, and Lisa Gordon