We just couldn’t resist the Hellman’s story we passed along last week but this week we’re back on track to bring you news on our industry. As a leader in the brand enhancement business, we are proud to have worked with many of the top organizations nationally and abroad, including some mentioned in the article below.
Original article can be found here.
The strength of the iPad has pushed Apple ahead of Google for the first time as the most valuable brand in the world, according to Millward Brown’s 2011 BrandZ study of the most-valuable global brands.
Apple ended a four-year run by Google at the top of the brand ranking. But the study by the WPP research unit also showed a changing of the guard among top brands in other sectors and an influx of new entrants from the so-called BRIC countries — Brazil, Russia, India and China — which collectively accounted for seven of the 11 newcomers to top 100 brands. While the eight top global brands are still U.S. based, China now has 12 brands in the top 100, up from seven a year ago.
Remarkably, Amazon edged out Walmart as the most-valuable retail brand by Millward Brown’s accounting, with its brand value rising 37% to $37.6 billion as Walmart’s fell 5% to $37.3 billion. Walmart parent Wal-Mart Stores still has more than 10 times the sales and more than five times the market capitalization of Amazon. But BrandZ’s calculation subtracts tangible assets from market value to help estimate brand value. Amazon, with no physical stores, fares well in that process. The Walmart brand value also doesn’t include Sam’s Club or other overseas affiliates with different brand names owned by Wal-Mart Stores.
Even so, Amazon’s rise, combined with declines in brand value not only for Walmart but also for other top global retailers Tesco and Carrefour last year, marks the shift toward e-commerce.
“Amazon benefits incredibly by having user reviews integrated into its site,” said Eileen Campbell, global CEO of Millward Brown. “Everybody does that now, but Amazon was the first, so it’s done an incredibly good job of building trust.”
Rebounding from a tough year battling widespread recalls and reports of quality problems, Toyota’s brand value rose 11% to $24.1 billion last year, putting it back atop automotive brands.
But BP, hit hard by its Gulf of Mexico oil spill, took a 27% hit to brand value. And it may not bounce back as quickly as Toyota, Ms. Campbell said. Toyota’s quick rebound reflects the underlying strength of the brand. But BP faces substantial doubts in surveys among decision makers on drilling leases and contracts, she said.
According to Ms. Campbell, growth of tablets and smartphones led to big gains in brand value for a lot of tech and telecom brands, which occupied the top three spots and six of the top 10. All but one of those, No. 2 Google, gained brand value year over year. Google slipped 2% despite the success of its Droid operating system.
In an email, Ms. Campbell said Google’s drop is mainly attributable to a 4% decrease in market capitalization from the year before and investments in such mobile platforms and the Chrome browser that she described as “heavy and ahead of return.” Google’s exit from China only affects about 2% of its revenues, she said, but did help boost Baidu’s value.
“Google is still pretty hot,” she said. “It remains one of the most-desirable and trusted brands we track.”
Down the list, BlackBerry’s brand value also slipped 20% last year, which Ms. Campbell attributed to the once-dominant smartphone brand not having as much new-product news as competitors.
The fastest growth in brand value came for Facebook, up 246% to $19.1 billion and No. 35 on the list. Chinese search engine Baidu was the second-fastest grower, leapfrogging dozens of older brands with a 141% increase to land at No. 29 on the list at $22.6 billion.
Wells Fargo led a number of financial players whose fortunes rebounded from the financial crisis and recession of 2008 and 2009. Its brand value nearly doubled, up 97% to $36.9 billion, or No. 16. Overall financial players gained 9% in brand value on average, as 15 of the top 20 financial brands on the list gained in value, nine of them by double-digit percentages.
The insurance sector also gained substantially on the list, thanks heavily to new entrants on the list — China Life and Ping An-both from China and now ranking first and second in their industry.
Fast-food brands also fared well, up 22% collectively, led by McDonalds, up 23% to $81 billion and No. 4 overall among global brands. Ms. Campbell attributed the strength of fast food to continued frugality among consumers turning away from pricier options.
Not a single packaged-food brand appeared on the list, however, largely because most don’t have global reach. Wrigley fell off the list not from any problem with its marketing but because it was acquired by privately held Mars, so its data could no longer be analyzed. Some privately held brands, such as Facebook, however, still made the cut because of publicly available valuations, in its case from Goldman Sachs.
Coke led beverage brands, up 8% to $73.8 billion, beating Budweiser, flat at $15.9 billion and Pepsi, up 1% to $12.9 billion.
Personal-care brands were also fairly flat, up 3%, with growth led by L’Oreal, up 11%, and its sibling Lancome, up 17%. While high-margin, market-dominant Gillette has long been the most-valuable brand in personal care, it slipped 4% last year to $19.7 billion, nearly overtaken by Procter & Gamble Co. sibling Pampers, up 11% in brand value to $19.4 billion.
BrandZ valuations are similar in some ways to how an investment bank would value brands, Ms. Campbell said. They’re based in part on brand-equity tracking surveys and financial data from Bloomberg and analyst reports. Millward Brown uses these data to calculate the earnings attributable to a brand, how much of the earnings can be attributed to a close bond with its customers and growth potential for the brand-driven earnings.
