What is a trademark worth? That is the question that researchers from Nova School of Business and Economics set out to answer in a brand-focused working paper. After looking at more than a million trademarks used by upwards of 20,000 different publicly-traded companies and quantifying the stock market reaction to the publication of those marks for the companies at issue, Nova’s Pranav Desai, Ekaterina Gavrilova, Rui Silva, and Margarida Soares found that trademarks possess “substantial economic value for firms.” Specifically, the authors state that the average individual trademark for the publicly-traded companies in their sample was worth $36.76 million, and the annual output of new trademarks represented approximately 2 percent of a company’s total assets.
Looking ahead, Desai, Gavrilova, Silva, and Soares assert that based on their research, companies’ future performance is “positively related” to their trademark application filing activity and any subsequently-issued registrations. “In the five years following the [registration] of a trademark, firms experience “considerable” increases in profitability and market share, they state, noting that these same companies also “subsequently invest more in physical capital, hire more employees, [and] increase production output.”
