The top 100 global brands shows Apple increasing its lead and the top brands getting younger, while businesses that have a purpose beyond profit – and women on the board – thrive.

 

See the top 100 most valuable global brands here

Businesses that have purpose beyond profit are growing at double the rate of other brands, read why here

Unilever’s chief marketing officer Keith Weed talks about brand value and sustainability

Rising up the BrandZ Rankings: read about how MasterCard has maintained its “Priceless” brand strategy

The message that shines out from this year’s results of the most valuable brands in the world is: marketing is vital. The companies that are growing fastest in value have strong brands at their core, according to Millward Brown’s seventh annual BrandZ report.

It’s a message that has clearly filtered down to Apple, which has stretched its lead at the top for the second year in a row.

Those businesses that can communicate they are “meaningfully different” are the stars in this year’s list, according to Peter Walshe, Millward Brown’s global BrandZ director.

Brand has become more influential in people’s purchasing decisions. Making a decision to buy on price alone has declined in the past 10 years from 16% to 7%, while deciding to buy on brand alone has increased from 43% to 59%.

Crystal clear strategy: Apple tops the rankings by a large margin
This year’s top 100 brands reflect the economic turmoil that most of the globe is facing in that there is only a marginal increase in their overall value. Collectively they are worth $2.4m (£1.5tn), only increasing by 0.3% since last year.

“It is the finances that are holding up some of these brands rather than the brand itself, but the strength of the brand enables businesses to punch above their weight,” says Walshe.

As consumers are faced with an increasing choice of purchase alternatives, they are “relying on, trusting, believing and acting on brand,” to help them make the right decision, adds Walshe.

Companies looking to cut corners by removing budgets from the marketing department could damage the business, warns Walshe. “If you cut your marketing spend you might have a short-term gain but you will have a medium and long-term loss.

“If the brand is still strong, the business is going to recover. The real worry is when your brand is not so strong, then that’s much harder to recover from.”

Apple has increased its value by 19% to $182.9bn (£115.7bn). The ability of the technology company to lead the way by managing to define categories such as smartphones and MP3 players has enabled it to dominate the top spot. Recent YouGov data demonstrates this point further. More than a quarter (26%) say they intend to buy a smart television from Apple, even though it is yet to launch one, pointing to the power of the brand.

Meanwhile, second position is now held by IBM, up from third position, which leapfrogged Google to get there. Google took the top spot in the 2010 list but was beaten into second place by Apple in 2011. It now ranks at number three. While Google’s overall value is still impressive at $107.8bn (£68.1bn), Walshe says it has not yet made the most of its Android mobile platform, meaning it has dropped down the list.

M&S’s ethical Plan A strategy helped it come in 10th in the top UK brands
IBM’s commitment to a cause beyond profit has helped the business grow in size. Its Let’s Build a Smarter Planet strategy has resonated with people, and plays into a wider trend of brands that commit to a purpose beyond profit growing in value by 87% over five years, compared to 43% for others. “IBM has a purpose beyond profit and this is really delivering for the business. It embodies its value,” says Walshe.

Twenty-one ‘responsible’ businesses feature in the top 100 and they “have greater growth rates and are more desirable,” according to Walshe. These brands have been identified in Jim Stengel’s book Grow, which details the top 50 businesses with a purpose.

In contrast, technology company Hewlett-Packard has had the “stuffing taking out of it”, says Walshe, even though it had started to “do an IBM” by focusing on environmental issues. The business has fallen eight places to 26 and its brand valuation is down by 35%. Sales of printers, one of its core products, are in decline and its responsibility message doesn’t seem to be as “sticky” as IBM’s, he suggests.

BlackBerry has fallen out of favour, too, tumbling out of the top 100 from 25th position in 2011. Likewise, Nokia has left the top 100, from 81st position last year.

Coke’s success is partly down to keeping the brand fresh as well its 126-year heritage
Apple and IBM are also indicative of a wider trend that the strong brands are growing stronger: the top 10 have grown 118% since 2006 compared to 66% for the rest of the top 100.

Apple’s design-led leadership helped it stay in the top position
The value of the top 10 brands has risen from $409bn (£222bn) in 2006, when the measurement began, to $892bn (£560bn). This contrasts with the bottom 10 brands, which have increased in value at a much slower rate. Back in 2006 their value was calculated at $46bn (£25bn). This year, the bottom 10 are worth $83bn (£52bn).

One business that is climbing the table at a rapid rate is Facebook. Bolstered by its $104bn (£65.7bn) stock market flotation, it is the top brand value riser, moving up 16 places to 19th position, rising 74% in value to $33.2bn (£21bn). The social media brand’s growing strength points to a wider theme borne out in this study, which is brands that create more buzz do better.

There is a strong correlation between buzz and overall value. The measure looks at social and traditional means of buzz – such as word of mouth – and three-quarters of the buzz is social, taken from Facebook pages and other social media such as blogs (but doesn’t involve Twitter). It is likely that buzz scores are underestimated, because only public-facing Facebook pages are analysed.

Facebook as a brand has the highest buzz measurement, according to BrandZ’s index. The Mark Zuckerberg business is hot on the heels of Google, the number three brand overall, and first-placed Apple.

While these technology brands dominate, emerging market brands are making it into the top 100 at record-breaking levels. Africa has got its first brand in the top 100 – mobile phone brand MTN, positioned at number 88. “It’s clearly benefiting from expansion in Africa where you don’t have lots of infrastructure for fixed lines,” explains Walshe.

Apple and IBM are also indicative of a wider trend that the strong brands are growing stronger
Twenty per cent of the top 100 brands are from emerging markets compared with just the two brands that featured in the list in 2006. The fast pace in which these brands are arriving on the BrandZ list is both a testament to the innovation in the BRIC countries and also a warning sign to western businesses – if they don’t respond, they will get left behind.

Burberry is one such brand embracing change and is using technology to provide something useful that will benefit the health of its business in the long term. By using social media and even allowing its consumers to customise its iconic trench coat online, it is “democratising luxury through technology,” says Walshe.

Walmart has shown that technology can help a business to recover. It has finally adopted a multi-channel approach, which has helped it to a large extent through a tough climate for grocery retailers. The US retailer is in 17th position, worth $34.4bn (£21.7bn) and although it slips two places, it makes it the most valuable retail brand in the world, rising above online retailer Amazon.

“Walmart was slow to adapt to the digital world but it is beginning to pay off. It’s about making technology your friend and making people’s lives easier,” says Walshe.

Credit card brands are also doing a good job of making people’s lives easier. Visa is top of the list, at 15 with a brand valuation of $38.2bn (£24.1bn), followed by MasterCard which rose 31 places to 29th position (see its case study, below).

Priceless experiences: MasterCard offers its customers after-hours tours of the Natural History Museum
Even fast-food brands are using technology to their advantage. Domino’s is succeeding because “the fact you can very easily order its food over the internet shows it is embracing technology for the benefit of the consumer”. The pizza business is in 9th position on the top risers list.

It is clear that brands which are doing well are embracing technology and social media. This is reflected in the age of the brands too. Top brands are getting younger. In 2006, the average age of a brand was 84 years old but now it is down to 68 years old.

Heritage is still useful but it’s how you use it. Walshe says using your age can be powerful but you have to “refresh it and keep it relevant”.

Even though Coca-Cola is a heritage brand – 126 years old – “it has the most youthful demeanour” says Walshe. Its Open Happiness strategy has taken it beyond “just a fizzy drink”, he adds. The business is the number six brand in the world.

Perhaps its strong position is also down to female representation in the boardroom. Those businesses that have women on the board grew by 66% over a five-year period, with an average value of $27.1bn (£17bn) whereas brands without grew by 6%, with an average of $13.2bn (£8.2bn).

But ultimately the strongest message from the BrandZ top 100 is the importance of maintaining a powerful brand, says Walshe.

“Marketers are really important people when it comes to the health of corporations because they’re the ones who understand what a brand is. They can make a brand win or lose.”

Read article: The top 100 most valuable global brands | Trends | Marketing Week.