In 10 days from now, stuff on September 21 2009, ask the mega-consultancy Interbrand and Business Week Magazine will be releasing their 10th annual ranking of global brands. Interbrand is trying to jack up enthusiasm with this big count-down clock (below). But of course, apart from Canadians who read my Mad at Switzerland rant, the big question is: who cares?
10 Reasons you should care about the
Best Global Brands 2009 list
1) These are the game-changing brands
Just a quick glance at the top ten from 2008 should be enough to show any brand manager that this is a list you a) want to be on eventually, b) need to be at least be aware of and understand the strategies of, and c) need to study, because like it or not, these brands are the rule-makers, breakers, and game changers in the world of branding.
For me, if I’m delivering a presentation or seminar, these are easily the list of examples I always choose from to make any point about branding – not because they do everything right (see my New Coke post and stay tuned for an upcoming pan of Intel), but because they are a common point of reference for most humans on earth.
2) These brands are global
And why are these brands becoming a common language around the globe? Well, the Global 100 ranking system only tracks brands that cross international borders – where more than 1/3 of their revenues come from outside a single country.
This leaves out big brands like many of the Mars chocolate products because they do most of their business in the USA. But it means that the brands that do make the list are much more likely to be household names in most Western countries.
3) The ranking distinguishes between brand & company value
This is where things get a bit tricky, but it’s one of the things that make this ranking important – and different – from most business lists. You’ll notice that the list includes brands that are companies – like Nokia or Google – as well as brands that are the product of parent companies that don’t make the list – like KFC (Yumm brands) or Blackberry (by Reaserch in Motion).
This makes the list a bit messy, like comparing Orange (which didn’t make the list) to Apple (which climbed 9 spots in 2008). But it’s a measure of the brands we consumers have in our heads, not the accident of corporate ownership which changes over time.
4) The ranking measures brand equity
Ultimately, the Global 100 ranking is pursuing the holy grail of brand management, which is measuring brand equity. In financial terms, this is the intangible – but considerable – value of the brands themselves to their owners. In brand strategy terms, brand equity is a measure of the strength of the relationships between brands and their customers.
The three areas they try to capture are the three “tangible” impacts of a good brand: a) the brand’s ability to command higher prices than un-branded alternatives, b) the value of brands to assist people in making purchase decisions, and c) the power of the brand to predicatbly influence future sales through loyalty.
5) It’s not perfect, but it’s the best we’ve got
Okay, I admit that there’s a lot of “special sauce” that goes into these rankings. Any time you are measuring intangible value, there is going to be some fudging.
In his book Branding only Works on cattle (free chapter online here), Jonathon Salem Baskin slams the Interbrand evaluation criteria:
All these assessment and rates are qualitative estimates. This isn?t math, it is religious scripture, created to reaffirm belief to the flock while ginning up enough obfuscation to dissuade nonbelievers.
Ouch. I have my own problems with and suspicions about the Interbrand methodology (E.g. the fact that Thomson Reuters vaulted into the rankings shortly after an Interbrand-led rebranding), but unlike Baskin, I’ll go with the rankings – not because they’re gospel, but because they capture the essence of something important that no one else has measured any better.
6) The world has changed
And this year, above all others, it will be fascinating to see how the rankings move after the great financial meltdown, the Obama factor, bail-outs, shrinkages in consumer spending, etc. Who’s moving up? Who’s moving down? Enquiring branders want to know.
7) Great Brands brand countries
And as I pointed out again in Swiss Secrets a few weeks ago, brands and countries have a symbiotic relationship. Who can look at any of these brands (right) without thinking of their countries of origin. IKEA is to Sweden as Verdana is to Microsoft… er wait.
8 ) Suspense: Will the US majority fall?
The US will again dominate the rankings as it had 52 brands in the top 100 last year. But after the melt-down, it wouldn’t take much to knock it off its 50+ pedestal. The rest of us wait with eager anticipation.
9) Suspense: Will Canada maintain or build its share?
We had our first two brands ever in the top 100 last year – Blackberry and Thomson Reuters. So will any more iconic Canadian brands join them on the list? The big Canadian banks all survived the melt-down with no bail-outs required, and TD and Royal Banks have started making inroads into the US market – as has newly repatriated Tim Hortons. But will any of them launch into the Top 100 limelight? I suspect not, but then, I may just be an overly modest Canadian.
10) Suspense:Have the “emerging economies” arrived yet?
The biggest question to watch this year and in the decade to come is this:
how quickly can the currently unrepresented powers like China, Russia, India establish a foothold and begin to build global brands?
They have already surpassed most Western countries in population and manufacturing and are catching up quickly in many other areas. But as yet there are no really big brands from these countries. That will change (see Enter China’s Consumers), but it remains to be seen when it will begin to shake up the brandscape as we know it. Perhaps we’ll get a hint on September 21.
I, for one, can’t wait.
If you’re an eager branding beaver as well, you can sign up here and Interbrand promises to “send you all the information as it goes live.”
YouTube message from Interbrand CEO Jez Frampton
Warning: it’s a bit of a yawn – with surprisingly low production values for Interbrand. I can get away with handy-cam rants, but surely the big guy could have rented a studio, and maybe dropped a few more substantive hints? Perhaps that’s why he had only 300 views as of this morning – even though it’s auto-running from the Top Global Brands Web Page.
Ashish Banerjee says
Re: point 5, when you say “I’ll go with the rankings – not because they’re gospel, but because they capture the essence of something important that no one else has measured any better.”
Not sure if you can posit that “no one else has measured any better” without a comparative assessment of the methodological robustness of Interbrand’s approach vs those of Brand Finance or Millward Brown Optimor.
Interbrand’s rankings may well be the best-known (because BusinessWeek makes much of their league tables every year), but that doesn’t make it the only game in town, or the best of the bunch. I happen to think MBO’s approach is more robust because its based on a much larger set of data inputs.
Dennis Van Staalduinen says
Thanks Ashish. Your points are well taken, and reading over my post you’re right I did make it sound as if Interbrand is the only game in town as opposed to the game that gets all the limelight. When I wrote “no one else has measured any better” I should have said: “no one else has been able to gain the same level of public exposure and dialogue”. But alas, I write these things quickly between my day job responsibilities.
I’m a great admirer of Brand Finance in particular, and often use their studies of the relative strength of intangible assets within Canadian brands (dismal) as a call to action (we need to do better).
Millward Brown Optimor is one that I have only passing acquaintance with, so I’ll have to read more on their approach before I open my big mouth again. Do you have any good starting points for me and my readers?
Ashish Banerjee says
Hi Dennis, MBO’s website is a good place to start.