For a few years now, the tech behemoths have been at the top of the chain in terms of brand value. That trend has continued this year in the BrandZ Top 100 Most Valuable Global Brands study, but there's been a change at the top, with Google making an acquisition of a different kind—the number one spot ahead of Apple.
The study, which was commissioned by WPP and conducted by Millward Brown Optimor, showed that Google's brand is now worth $159 billion, an increase of 40 percent year on year. Overall, the combined brand value of the top 100 was up 12 percent year on year (the combined value of the Top 100 has nearly doubled since the first ranking was produced in 2006 and is now worth $2.9 trillion).
Apple, which spent three years at number one, slipped to second on the back of a 20 percent decline in brand value to $148 billion. A release says that "whilst Apple remains a top performing brand, there is a growing perception that it is no longer redefining technology for consumers, reflected by a lack of dramatic new product launches".
The world’s leading B2B brand, IBM, held onto third position with a brand value of $108 billion, Microsoft was up three spots to fourth, and Amazon took tenth spot, with an increase of 41 percent.
Technology brands in the Top 100 total $827 billion, almost 30 percent of the list's total value and the technology category rose 16 percent overall in brand value.
“Google has been hugely innovative in the last year with Google Glass, investments in artificial intelligence and a multitude of partnerships that see its Android operating system becoming embedded in other goods such as cars," says Nick Cooper, managing director of Millward Brown Optimor. "All of this activity sends a very strong signal to consumers about what Google is about and it has coincided with a slowdown at Apple.”
- Check out this New York Times story on Google's plans to advertise in cars, on thermostats and other devices.
In this part of the world, the big banks performed well, with Australia’s Commonwealth Bank moving up four places to No 44 with an 18 percent increase to $21 billion, ANZ remaining at No 52 with a 15 percent increase to $19 billion and Westpac moving up three places to No 85 with a 17 percent increase in brand value to $12 billion. Woolworths is the fourth Australian brand in the Top 100, down two places at No 82.
“The impressive growth in brand value of the two Australian brands in this year’s Top 100 is in line with the strong recovery in valuations seen across the globe,” says Johnny Panagiotidis, senior business consultant at Millward Brown Australia. “The global financial crisis was a challenging time for many companies but despite fluctuating macro-economic conditions and the impact of digital disruption, we still see seventy-one of the brands listed in our 2014 Top 100 that were there in 2008. Strong brands are better able to weather the storm and, when valued by companies, create value for them.”
The study is now in its ninth year and it is the only ranking that uses the views of potential and current buyers of a brand, alongside financial data, to calculate brand value.
Share of Life: Successful brands such as Google, Facebook, Twitter, Tencent and LinkedIn are more than just tools, they have become part of our lives. They offer new forms of communication that absorb people’s attention and imagination, while also helping them organise the rest of their lives at the same time. To gain more of our mind-space, brands such as leading Chinese internet brand Tencent and Google are even crossing categories. This trend also pushed No 1 Apparel brand Nike, a prime example of a brand seeking to become a share of life brand which offers services such as Nike+ that extend well beyond its functional raison d’etre.
Purpose beyond Profit: Brands in business for reasons beyond the bottom line have a better chance of success in today’s world. For example, Pampers, which promotes mother and baby health issues, is at No 39 in the ranking and grew its value by 10 percent to $22.6 billion. Dove, which has continued to find huge success on the back of its “real women” philosophy, has a brand value of $4.8 billion.
Apparel fastest growing category: The top 10 apparel brands grew in value by 29 percent to nearly $100 billion this year, outpacing cars (up 17 percent) and retail (up 16%). With brands such as Uniqlo, Nike and Adidas all recording double-digit increases in their valuation.
Technology service companies continue to climb: Not only are the top four brands technology companies, but so too are many of this year’s biggest risers. This year’s fastest climber was Tencent, up 97 percent to $54 billion and the No 14 position, followed by Facebook which rose 68 percent to $36 billion and took the No 21 spot. New brands in the Top 100 include Twitter at No 71 with a brand value of $14 billion and LinkedIn at No 78 worth $12 billion. Collectively, technology companies make up 29 percent of the value of the Top 100.
High value brands provide faster growth: An analysis of the rankings as a ‘stock portfolio’ over the last nine years shows a highly favourable performance compared to a wider stock market index, the S&P500. While the value of the companies in the S&P500 index grew by 44.7 percent, the BrandZ™ portfolio grew by 81.1 percent, proving that companies with strong brands are able to deliver better value to their shareholders.
Brands from theWestern World bounced back in 2014, with a greater proportion of both the number and value of brands within the top 100. This reflected the resilience of established brands and the breakthrough of new brands, as well as improved economic conditions. As a result, the number of brands from fast growing economies slipped in 2014. China, with 11 brands, continues to have the largest representation, two Russian brands, Sberbank and MTS, remain in the ranking, and mobile operator MTN is Africa’s representative for the third consecutive year.