Brand value measured in billions of dollars
When it comes to brand valuations, there are generally two varieties. The first examines consumer sentiment, opinion and perception of a brand. The second looks at various factors contributing to brand reputation or value like share price, profits and media analysis. For Kantar Millward Brown and the BrandZ ranking, it’s a dual approach.
By combining over three million consumer interviews with financial and business performance, the rankings are able to create a valuation that considers what people think and how the brands’ bottom lines actually look. The overall brand value of the global top 100 is $4.4tn. That said, the top three in the 2018 ‘Most Valuable Global Brands’ research are unsurprising. Google, Apple and Amazon easily take the top nods.
In fact, the top 10 are nearly all technology, media or telecoms brands bar four companies: Amazon, Visa, McDonald’s and Alibaba. And of that group, McDonald’s is the only one with regular bricks-and-mortar shops. Additionally, that top 10 has only one new entrant since the 2017 rankings, with Alibaba coming in at number nine this year.
For the UK, it’s a somewhat different story. The most successful brand are either telecoms providers, banks, oil and gas companies or Tesco, with a few outliers. The research says this is due to consumers perceiving a lack of innovation in the individual businesses and their sectors. UK brands overall have a score of 102 in innovation, while the global top 100 has a score of 110, in the rankings.
Martin Guerrieria, global BrandZ research director at Kantar Millward Brown, says, “With continuing perceptions that there’s an ‘innovation gap’ in the UK, partnerships are proving pivotal for brands that may struggle to innovate organically. A smart collaboration can be a way to quickly gain capability and credibility, and create a perception of innovation, as well as bringing increased speed, agility and reach. But the collaboration has to feel right, and be completely relevant to the purpose and the brand.”
Kantar Millward Brown expects Chinese brands to make an even bigger impact next year due to their success in the 2018 rankings. Retail is also expected to grow, as it was the fastest-rising category in this year’s research. The top 100 list represents a company with a successful brand. Visa (seventh overall), for example, sees its brand value at $145bn. With numbers like that, its easy to see why brand has value.
The top 10: