ResearchThe value of branding

The value of branding

Sep 25, 2020

Earlier this week, Peloton investors were surprised with a sudden -5% stock price decline after hours. The culprit? A competitor named Echelon announced a "Prime Bike" exercise bike developed in collaboration with Amazon.

Amazon later claimed this wasn't the case, promptly disavowed any affiliation to the product, and removed the Prime Bike from its website. It was an unusual sequence of events that had many investors scratching their heads.

We think it is a testament to the strength of Amazon's brand that competitors in completely unrelated verticals are trying to piggyback off of its branding. The question is, what is that mimicry worth?

Let's talk brand value for a moment.

There are a handful of household co's across the globe with consistently great products and a reputation for quality (think: Disney and Nike). But how much of their stock prices are attributable to that brand value? It's a tricky question. You can't look up brand value on Google Finance.

While many investors ignore seemingly fluffy concepts like these, we look for qualitative data points on their worth. Are you successful in seemingly unrelated verticals over and over again? Are competitors trying to use your brand to sell something they've built? If so, your brand is probably worth a lot.

Back to Amazon. The company is seeing rapid adoption across unrelated verticals from home products (Amazon Basics) to luxury apparel. Now an unrelated fitness company launched a "Prime Bike." Putting the Amazon label on a product is increasingly akin to Nike shoes or a Disney movie.

Imitation is the sincerest form of flattery. It's hard to estimate, but when it comes to brand value, you usually know it when you see it.

Cash Management

Smart Cash

Smart Cash FAQs

Cash Options

Get Smart Cash

InstagramTwitterYoutubeLinkedIn

© Copyright 2024 Titan Global Capital Management USA LLC. All Rights Reserved.

Titan Global Capital Management USA LLC ("Titan") is an investment adviser registered with the Securities and Exchange Commission (“SEC”). By using this website, you accept and agree to Titan’s Terms of Use and Privacy Policy. Titan’s investment advisory services are available only to residents of the United States in jurisdictions where Titan is registered. Nothing on this website should be considered an offer, solicitation of an offer, or advice to buy or sell securities or investment products. Past performance is no guarantee of future results. Any historical returns, expected returns, or probability projections are hypothetical in nature and may not reflect actual future performance. Account holdings and other information provided are for illustrative purposes only and are not to be considered investment recommendations. The content on this website is for informational purposes only and does not constitute a comprehensive description of Titan’s investment advisory services.

Please refer to Titan's Program Brochure for important additional information. Certain investments are not suitable for all investors. Before investing, you should consider your investment objectives and any fees charged by Titan. The rate of return on investments can vary widely over time, especially for long term investments. Investment losses are possible, including the potential loss of all amounts invested, including principal. Brokerage services are provided to Titan Clients by Titan Global Technologies LLC and Apex Clearing Corporation, both registered broker-dealers and members of FINRA/SIPC. For more information, visit our disclosures page. You may check the background of these firms by visiting FINRA's BrokerCheck.

Various Registered Investment Company products (“Third Party Funds”) offered by third party fund families and investment companies are made available on the platform. Some of these Third Party Funds are offered through Titan Global Technologies LLC. Other Third Party Funds are offered to advisory clients by Titan. Before investing in such Third Party Funds you should consult the specific supplemental information available for each product. Please refer to Titan's Program Brochure for important additional information. Certain Third Party Funds that are available on Titan’s platform are interval funds. Investments in interval funds are highly speculative and subject to a lack of liquidity that is generally available in other types of investments. Actual investment return and principal value is likely to fluctuate and may depreciate in value when redeemed. Liquidity and distributions are not guaranteed, and are subject to availability at the discretion of the Third Party Fund.

The cash sweep program is made available in coordination with Apex Clearing Corporation through Titan Global Technologies LLC. Please visit www.titan.com/legal for applicable terms and conditions and important disclosures.

Cryptocurrency advisory services are provided by Titan.

Information provided by Titan Support is for informational and general educational purposes only and is not investment or financial advice.

Contact Titan at support@titan.com. 508 LaGuardia Place NY, NY 10012.