ABSTRACT
The revenue premium method is part of a larger method called profit premium method. A brand may generate a profit premium for a company by increasing its revenues or reducing its costs. This chapter focuses on the revenue premium method, which includes the price premium and the volume premium methods, and belongs to the family of intrinsic valuation approaches. The idea is to assess how much a brand contributes to a company's revenue and cost structure and, thus, quantify the part of profits and cash flows that is directly attributable to the brand. The value of the brand is then calculated from the present value of the cash flows that it directly generates. The method is therefore based on a "marginal' approach to brand valuation. However, price differences that are attributable to the brand must be highlighted without including the price differences due to product quality or presentation.
