MillwardBrown released its annual Brand 100 Ranking for the year 2012. After a turbulent year for technology giant Apple, the brand has held its top position as the worlds most valuable brand. IBM has pocketed Googles number two, with a strong growth in the B2B market.
International development has spurred brands from Afrika, such as MTN – the south African telecom – or Chiles retailers Falabella or Sodimac, who have stepped into to top 100 most valuable brands.
Facebook has taken a large leap and increased its value by 74 percent moving up to number 19 of the worlds most valuable brands, surpassing brands such as Baidu, HP, Oracle or BMW and has caught up to Amazon or Walmart.
The BrandZ analysis shows some key outtakes what customers are expecting from a brand, such as value, corporate responsibility and digitalism. Brands need to be on top of what’s new, and constantly need to renew their image by innovation to stay strong brands.
The report gives a long and detailed view on how the future of brands will evolve. On the other side the 100 pages provide a rather disappointing overview on how brand value is measured.
According to Aaker (Managing Brand Equity – Capitalizing the Value of a Brand Name, 1991, p.15) a brand is “a set of assets and liabilities linked to a brand, this name and symbol, that add to or subtract from the value provided by a product or service to a firm and/or that firm’s customers”. In other words: the difference a person is willing to pay for a branded product compared to an unbranded product.
The additional value of a branded product needs to be quantified with the sum of products sold to generate a brands value, multiplied by the prospects of future earnings. The data on which MillwardBrown relies are not explained in detail (of course, I wouldn’t’ want to give away my key calculation either).
A key problem of the report is, that brand value is only measured at an aggravated level and can’t formulate a brands value at an individual level. Also MillwardBrown uses financial data of a company and integrates it in its brand index. This means that brand non-related factors are added to a brands value and therefore falsify the calculation of the actual worth of a brand (e.g. reduced turnover due to currency fluctuation). MillwardBrown ranked BP with one of the highest brand values world wide (worth 12 billion $) in 2011 but was one of the most mistrusted brands after the 2010 oil spill fiasco). Therefore the MillwardBrown index rather gives a good overview on a companies worth rather than measuring actual brand equity composed of brand image or brand awareness.