BrandZ: Apple overtakes Google as most valuable brand

by Maarten Swemmer Leave a reply »

In the brand value ranking maintained by BrandZ, Apple has now succeeded Google as the most valuable brand with a value estimated at $153 billion. That’s a 859% increase since 2006, the year before Apple introduced one of it’s biggest hits until now, the Iphone (announced in January 2007). In the BrandZ ranking IBM remains third.

Comparing Apples with ‘peers’

It’s interesting to remark that in another ranking by InterBrand, Apple scored only 17th in last year September’s assessment with a value of only $21.143 billion. That’s almost 8 times less. This should all have to do with the methodology differences in measuring the brand value.

Interbrand’s methodology includes three factors: economic profit (results from annual financial reports extrapolated over the next few years), the role of the brand in that profit and the brand strength assessed by an expert panel, expressed in terms of Commitment, Protection, Clarity, Responsiveness, Authenticity, Relevance, Understanding, Consistency, Presence and Differentiation.

BrandZ is less clear on it’s methodology. In it’s 2010 report it states: “The BrandZ Top 100 is the only ranking based on a brand valuation methodology that is grounded in both quantitative customer research and in-depth financial analysis.” That looks a lot like the way Interbrand does it.

According to Financial Times, who appears to have the preview on the 2011 ranking (the BrandZ website does not yet have it) BrandZ includes “earnings, valuation of intangible assets, measures of customer perception and an estimate of growth potential”. One of the factors of importance mentioned in the BrandZ document of 2010 is it’s focus on local circumstances like developments in the emerging BRIC countries (Brazil, Russia, India, China) compared to developed markets.

Apple – not the next best thing

Both rankings are still very interesting. The significant differences that remain between the two, make both of them less reliable, but not less usable. A lot of brand value has obviously to do with a consistent consumer perception. Why does Apple do well in this area? Because they focus on detail. In all areas of their original three brand pillars, Technical, Stylish and User Friendly, they go for perfection in stead of the next best thing. From a short term (1-2 years) financial point of view this seems a risky and costly strategy, but Apple proves that in the long term it’s the only way to guarantee the desired brand perception and corresponding brand loyalty.

Update 10-5-2011: included feedback from jb’s comment.

One Response

  1. jb says:

    The major difference is that Interbrand uses an expert panel (not clear who these experts are) to determine both brand strength criteria and the role of the brand factor. Also, financial information comes from annual financial reports. BrandZ uses stock market valuations for the financial portion and consumer surveys for the brand equity portion. They are two completely different approaches, hence two completely different results.