Brand Value & the Most Powerful Brands 2016 (with Infographic)

branding

Brand value – everyone wants it, however, only few are able to achieve it. The subject of “brand value” holds a significant position amongst marketers, executives, and entrepreneurs. Let’s discuss what makes a brand unique, and how it is evaluated.

Brand makes your business unique. It sets the company apart and has the ability to position the business on the top in their specific industry. Sometimes, a brand is the company’s most valuable assets. In fact, many companies are often referred to by the name used in their brand – and they become one and the same. A strong brand identity drives customer loyalty, for the simple fact that once a customer uses your services and has a positive experience, your brand will bring them back.

apple google - most powerful brands

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Everyone knows the most powerful brands just by glancing their logos: Apple, Google, Facebook, Mercedes-Benz, BMW, Disney, McDonald’s and Coca Cola are just a few. A brand can be any name, symbol, word, sentence, or logo that is used to distinguish the product from other similar products available on the market.

However, there is more to it than just a nifty logo and a catchy name. Everything you do within your business adds to your brand equity – the choices you make in product design, the quality of service that customers receive, the handling of customer complaints and any other services that your company offers – all of these things can add to credence to your brand equity.

What is Brand Equity (Value)?

Well, brand equity can be best defined as the phrase that is used inside the industry of marketing that defines the significance of having a well-established and recognized brand name, based on the concept that the owner of the brand is capable of generating more profits from products registered under that brand name over those products of a not so popular name. This justification is based on the perspective of many customers that a product which has a well-known name is much better compared to those products from a less popular brand name.

brand value equityThe main principle behind brand equity is the relationship between a consumer and the company selling the products/services. If the customer prefers a specific brand over the other, it is mainly because of his or her perception of the brand and its value regardless of the price tags on the product.

Of course, the company must strive hard to earn and maintain the consumer’s loyalty for their brand. To establish a brand value, the company must earn name recognition for its product, encourage the customer to actually try their product/service and convince them that their product is acceptable. Only after that the company can expect to secure a few preferences for their brands.

Having solid brand equity not only increases the profits and revenues for the company but it lower costs as well. the companies that already have an established brand equity are likely to spend less on marketing since the existing as well as potential consumers are already aware of their product. They don’t have to go into the hassle of educating the general public about their company and its products/services. Having brand equity also helps the company expand into different product lines. Since the customer is already following the brand, they are more likely to try any new product that is created by them.

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Whether through a quality product line, excellent consumer service, and/or exceptional marketing techniques used by the company – having a strong brand equity symbolizes that the company has gained enough recognition and respect from their consumers that guarantees they will spend more on products created by that brand.

The Benefits of Brand Value

Simply put, “brand equity” is the construct which is specifically designed to replicate the actual value which the brand name is holding for products and services which it accompanies. Measuring brand equity has been considered important mainly for the reason that brands are regarded to be powerful influencers of crucial business results like market share and sales.

“Branded products invariably command a higher price than so-called ‘store brands’ or ‘generic’ – even when the product itself is a commodity such as sugar. In these cases, the higher price is due almost entirely to the power of the brand.”

Inc. Magazine

Here is a list of the advantages of brand equity that were identified by Kevin Keller, a professor from Dartmouth College:

  • Be perceived variably and then produce varied interpretations of the product performance
  • Enjoy better loyalty as well as be less prone to competitive advertising actions
  • Command bigger margins and gain more unyielding responses to cost hikes and flexible responses to price drops
  • Obtain better support and trade cooperation
  • Boost the effectiveness of marketing communication
  • Backing brand extensions
  • Produce licensing opportunities

Just like other constructs, brand value has been defined and gauged in different ways. It’s sometimes understood from the viewpoint of perceptible financial assets of a company. On the other hand, from the marketing research outlook, it is usually viewed conceptually, as the framework to understand the effectiveness of emotional and intellectual associations that customers do have with branded services and products.

Contrary to outright dollar valuations, which underscore the direct financial perspective, the marketing researchers are looking to gauge and then understand the brand value for strategic planning and positioning.

Brand Equity Modeling and Brand Value Measurement

Brand equity has been defined and measured in numerous ways. However, the measurement process is not as simple as counting the number of individuals who recognize a certain brand name or symbol. It can also not be assumed by the fact that if the brand is popular, it holds strong brand equity. In fact, the most powerful brands can effortlessly be weakened by any wrong steps taken by the company or faulty product.

As a matter of fact, most research agencies worked and developed their own brand value model which is implemented in collaboration with the end-user researchers. Professor Kevin Keller said:

“Although the details of various approaches to conceptualize brand value differ, they tend to share a general core: All definitions usually either explicitly or implicitly depend on brad knowledge structures within the minds of customers both organizations and individuals as the foundation or source of brand value.”

Professor Keller

Researchers explain and gauge brand equity when it comes to knowledge that consumers have about a specific brand. Different published brand value models and measurements were available up to date. Remarkably, measuring brand value might be just a single piece of a more complete brand research program. Also, a brand research program of an organization might be just a single facet of a bigger research & insights program.

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Brand Value Model:

  1. Brand Awareness (strength of brand in consumer’s memory)
    • Breadth (likeliness of recognition and recall of the brand)
    • Depth (mindfulness of the brand under various purchase or consumption scenarios)
  2. Brand Image (consumer perceptions and preferences for the brand)
    • “Lower” order brand associations (perceptions of benefits and attributes):
    • – Brand Performance – characteristics and features, reliability, serviceability and durability, effectiveness, empathy and efficiency, style and design, price.
      – Brand Imagery – user profile, purchase circumstances, usage situations, values and personality, history and heritage.

    • “Higher” order brand associations (judgments, responses and feelings):
    • – Brand Judgments – brand quality, brand credibility, brand consideration, brand superiority.
      – Brand Feelings – warmth, fun, excitement, security, social approval, self-respect.

Measurements

  1. Brand Equity Measurement
    • Brand Awareness (Brand recognition, Unaided recall, Aided recall)
    • Brand Image (Free association, Interview, Means-ends chain analysis, Projective techniques, Zaltman Tech., Aaker Scale, Ethnography or Observ, Fournier BRQ scale)
  2. Extra Measurement
    • Comparative Approaches (Brand based comparative approaches, Marketing based comparative approaches, Conjoint comparative approaches)
    • Holistic Methods (Valuation approach, Residual approach)

Experts usually agree that the best way to measure the brand equity depends on its specific industry or company. In some cases, the brand equity can be analyzed by looking at the customer’s preference for the product while other cases require a careful study of customer’s satisfaction or market share of the company.

Most Powerful Brands in 2016

brand value and the most powerful brands 2016

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It should come as no surprise that Apple tops the Forbes 2016 list. Recognizable products, a strong product portfolio and the ability to have people lining up for hours on product launch day. Despite strong competition they are responsible for almost half of the mobile phones sold in the US. The tech giant Apple is the most valuable brand of 2016. Having a value of $154.1billion, this is the sixth year Apple has dominated the rankings.

Google is now number 2, passing Microsoft and it isn’t difficult to understand why. The name Google has become synonymous with any internet search, if you don’t know something your friend will advise you to Google it. After Microsoft come Coca-Cola and Facebook.

Facebook is a prime example of something that started small, aimed at kids in one college as a beta test and grew into a behemoth. They constantly update their platform on the back of customer feedback and sometimes it might take longer than the customers want but they keep them in the loop that change is coming. People threaten to delete their accounts all the time, but they just keep coming back for more. Almost two billion of them!

BrandFinance Worlds Most Powerful Brands 2016

On the other hand, according to brandfinance.com, which ranks the company’s based on their product quality, familiarity, promotion, customer loyalty, marketing tactics, staff satisfaction, and reputation – Disney is the most powerful brand of 2016. Having a brand value of $31.7 billion, the company has acquired the number one position due to its long and established history. It has also acquired many prominent companies recently. These include purchasing ESPN Inc, Star Wars, Pixar, and the Muppets and the Marvel.

The Danish Lego Company which was dominating the charts in 2015, shifted to #2 positions as a result of several controversies that were circulating about the company in the past year. The quality of their products remains the same but other factors contributed to their downfall.

Last year the toy company whose products are loved and cherished by kids of all ages was fined by German officials for preventing retailers from discounting its products. It was also a part of the censorship issue where it prevented a Chinese artist from using Lego in his work. Yet, the brand remains powerful and a part of every child’s toy box. L’Oreal with a brand value of $14.9 billion sits on the third position while PwC auditing company holds the court on the fourth. The consulting firm McKinsey is ranked on the fifth position while the 40 year old brand “Nike” is still going strong on the sixth position.

The recent reports that incorporated 100 brands from 16 countries serves to remind us how valuable and powerful a strong brand can be and really is.

Conclusion

Every market is cluttered, so by doing your research before you jump in head first you will be better placed to grow your brand identity.

If you’re starting fresh you are in a better position than most, because you can look at the market you are moving into and find what is missing to really carve out an identity for your business, give it a personality that is likely to attract customers and see them coming back for more.

Who is your target market? The face of your company should reflect them, a customer should be able to look at that and say, yes!

We’ve watched many iconic brands slip away in recent years and the same can be said for most of them: they completely lost sight of their identity. They knew who they wanted to target they just didn’t understand what it would take to make their target realise they were the brand for them.

Look at your brand preferences and look at your business, or your potential business. What can you do to build a brand as solid as that?

  • Make it relatable, tell your customers a story – the story of how your business came to be, how you started out, and sell them on you.
  • Deliver first class customer service, employ people who are willing to go the extra mile.
  • Offer high quality products at fair prices.

There are a lot of people trying to say that brands are dying out because with the emergence of the internet customers have more options and far more information available to them. I would suggest there are brands that will never go away because they have the ability to adapt to the changes and movements in their industries. They take the time to understand what their customers want and need and they don’t waste time in putting it into action.

If you want to build a successful brand then you will take heed of the big names that have gone down the drain and adopt a more pro-active approach to running your business.

Good luck!

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24 thoughts on “Brand Value & the Most Powerful Brands 2016 (with Infographic)

  1. Branding is not easy. I’ve successfully branded an Imaging company in my hometown, but I still want to expand the reach of that company. I’ve been having more success with my brand that provides online content. I’ve been a full-time entrepreneur for over 5 years and I learned more about branding on the “job” than I ever did in school. What I want to do is have one of my products I’m developing launched under a brand with “equity”. Many companies used “Donald Trump” in that way for years. Great post!

  2. When it comes to take services from a company or to buy a product from the market BRAND matters the most because of the build quality and quality of service served by them. Brand is just an appreciation that enables a wide range of customers all around the world it shows how much believe customers have on a particular brand. Nice article thanks for sharing it. Good to see it here.

  3. It is indeed a post where we get to know about the brand names and what a brand name can do to influence audience towards our company. But there are very number of people who actually make it BRAND name. Otherwise everyone do work for their company. but who actually do work in a smarter way they really the super heroes. They are the real inspiration for us. Like Mark Zukerberg at Facebook, Steve Jobs at Apple.

  4. Brand name is most powerful tool now a days to attract people to our organisation. Like Apple in this world is most powerful brand in the field of mobile phones . A brand name tells to the customers that how much popularity it has in the market. It is very helpful in increasing revenues.

  5. In the world of technology, Apple is the most powerful and rich brand. But after Steve Jobs, I personally feel that the brand is seeing a decline.

    I don’t know if my intuitions are right but Google may take over Apples legacy in coming 10 years.

    Let’s what happens.

  6. From what I have gathered, the more you research before starting a brand the better off you are. I know some of these brands weren’t even recognized world wide up until the last 10 to 20 years. I really liked the detailed chart you showed. I had no idea that Apple had so much. I thought they were in the top 20 brands in the world, sure.. But they are kicking butt!

  7. I’ve been reading a lot on this subject the last few days and from what I gather, it takes a lot of research before you dive in. I always hear of new brands coming up in the world but then they just disappear. Branding and being aware of your competitors isn’t as easy as people think.

  8. My father had his own business when me and my brothers were still kids. He had a solid branding and a good customer base. As years went by, the larger companies started taking over and he could not longer keep up with the costs so he closed down. He never was able to get is brand into commercial retailing because of it.

  9. Rachel Greenwood says:

    Very good post. What a long one too! I actually feel like I learned a lot about how company branding works. I never really read on the subject until the last few days. Me and my sister in-law are going into business so this has actually helped me a lot, thanks!

  10. Color me surprised but I had no idea that Facebook was a “brand”. LOL I am actually coming here from Facebook as well. I guess I only ever considered brands to be items that are being sold. Same for American Express… That is a credit card is it not?? I guess brands have to do more with investing than selling these days.

  11. Kelly Wright says:

    I remember when Walmart first starting getting big and people were happy and excited but once local businesses started closing down and people were losing money, everyone panicked. I feel like these huge corporations (brands) are basically in control and the lesser known businesses just don’t stand a chance anymore.

  12. I’m not sure if I ever read something quite so mind blowing in the world of business. Like I knew that there were powerful companies out there but knowing that they essentially set the stage is a shocker. It seems as if you have to have something great and something they haven’t tried or don’t have to stand out and make it.

  13. I agree completely about doing research. I think a lot of starting businesses and companies don’t do this key step and end up flopping down the line, loosing customers and money, and just going broke. You need to see who you are competing with and learn them before you can step up to the plate.

  14. This was a very insightful read. I had no idea this much went into company branding. Like with all the top brands in the world, you would think a lot of it just had to do with luck and people just generally enjoying their products but it goes beyond that. Going to share this with a few friends who are in business, they may enjoy it.

  15. I came across this post on Facebook and I was curious. I just don’t see that big of a difference from previous years. I could be wrong but the strongest companies seem to have been ruling for some time now. I mean Apple has been on top for at least the last 10 years. Coke I would guess has dominated for the last 30+ years. I enjoyed the read either way.

  16. As someone who works in marketing, I can attest to the importance of good branding. A company’s brand define its identity, not only for its employees but also its target audience. From the business’ culture to the image it conveys, every detail matters.

    However, its how you market that brand that makes a company successful. Most company’s will never reach the elite fame and status of company’s such as Apple, Microsoft, Google, or Facebook (although there is a lot that they can learn from these “giants” in business).

    Quality products and great customer service are both good business practices. A successful brand takes it further. Consider the personalities many businesses use to give their product or service personality: Hotels.com has Captain Obvious, Dos Equis had “The Most Interesting Man in the World,” Budweiser has its majestic Clydesdales… all of these are amazing examples of how branding and marketing imprint a business and its product or service into the memory of their target audience while creating a fond relationship in the process.

  17. Wow! Really solid information here. Great infographics too! Wish I could slide this post into an envelope and mail it to all of the business owners I have come across who have haphazardly named their businesses. You named some solid ones. My favorite brands right now are Uber, Acorns, and Square. Very clean lined memorable logos and solid brand strategies fro these companies.

  18. It’s strange to not see Apple in the first 10 brands (in the second ranking system from brandfinance). I can understand why they consider Walt Disney the number one brand – it’s because of their recent acquisitions mainly but not having Apple here is… wrong. Lego should try to improve their image because they recently showed a side of them I didn’t like. They must be more open minded and put their overall image before their profits. A very well written post, thank you.

  19. Todd Palmer III says:

    Great post! I am helping a friend with his Amazon business, and developing a brand is vital to longevity even on the Amazon platform. I often listen to the John Lee Dumas podcast and he is constantly preaching the value of a quality brand and quality products. People do not mind paying more money for certain things they just want those things to be significantly better than the lessor priced items. My friend sales two different types of shaving brushes and just to get his feet wet in the amazon market place he sold shaving brushes which cost the consumer around $15 which would come with a one year warranty. When he decided to sale shaving brushes around the $50 market he had already built his brand into a reputable brand that people knew and trusted which allowed him to sale his higher end products by saying “from the makers of…” That is in his sales copy and it works wonders for him. So the importance of a quality brand cant be stressed enough.

  20. I really enjoyed reading this post. Your infographic really helps put things in perspective. Thanks for your insight and all the useful information.

  21. The acquisition of “Star Wars,” ESPN, Pixar, The Muppets, and Marvel has made Disney the most powerful brand in the world. “Star Wars” has been particularly profitable for Disney since it acquired Lucasfilm for just over $4 billion in 2012. Brand Finance now estimates the “Star Wars” brand to be worth $10 billion. But Disney is not only powerful because of recent purchases: It benefits from a long and established history.

  22. Wow, it’s been a long time since i read a post line by line till the very end. You nailed it. Very informative and easy to comprehend. Permit me to share this on facebook and twitter,