Strong Brand Value Among Tech Firms

Technology companies gained the most overall brand value over the past year, according to the fourth annual list of the top 100 global brands compiled by Interbrand Corp. and BusinessWeek. Meanwhile, some of the most recognizable companies suffered losses.

The 2004 scorecard ranked the world’s most valuable brands, finding overall growth of 2.2 percent.

The biggest brand value growth on the list came from Apple, moving up seven places to #43, and registering a 24 percent gain. BusinessWeek attributed the iPod to the company’s strong showing, proving that loyalty-inspired products and high-tech consumers can positively impact the bottom line.

Amazon, Yahoo and Samsung were the other big gainers on the list, each posting double-digit increases to brand values. British bank HSBC was the only non-tech company to make the list of the biggest gainers.

The top two companies, Coca-Cola and Microsoft, suffered losses to their brand values in the last year – 4 percent and 6 percent respectively. The researchers’ scorecard blamed Coca-Cola’s losses on poor innovation and management, along with a lull in consumer demand, while Microsoft dealt with virus woes over the last year.

Both companies have recently made inroads in strengthening their brands by creating campaigns that nurture their ties to consumers. Coke embarked on a deliberate attempt to woo young consumers, in part through through Cokemusic.com, while Microsoft fostered community outreach through mini trade shows in airport lounges.

Kodak exhibited the largest drop in brand value – 33 percent – followed by Japan’s Nintendo, which lost 21 percent; AOL, 18 percent; Finland’s Nokia, 18 percent; and automaker Ford, 15 percent.

The U.S. is still home to more than half of the power 100, but the overall number of American companies on the list dropped from 64 to 58. Only two of the nine new entries – eBay and Estee Lauder – were American companies.

Companies that specialize in luxury goods were most prominent among the new entries: Porsche, Audi, Cartier, Estee Lauder, and Armani. Also making their debut were Siemens, UBS, and ING.

BusinessWeek and Interbrand use distinct criteria to determine the rankings of the global scorecard. Value is calculated as the net present value of the earnings that the brand is expected to generate and secure in the future from July 1, 2003 to June 30, 2004, and the brand has to be valued at more than $2.1 billion.

The brands had to be global, generating significant earnings in the main global markets, and there had to be sufficient marketing and financial data publicly available for preparing a reasonable valuation. Each company also had to derive one-third of its earnings outside of its home country.

Top Global Brands, 2004
Rank Rank Company Brand Value
(in millions)
Percent
Change
Country of
Ownership
2004 2003 2004 2003
1 1 Coca-Cola 67,394 70,453 -4% U.S.
2 2 Microsoft 61,372 65,174 -6% U.S.
3 3 IBM 53,791 51,767 4% U.S.
4 4 GE 44,111 42,340 4% U.S.
5 5 Intel 33,499 31,112 8% U.S.
6 7 Disney 27,113 28,036 -3% U.S.
7 8 McDonald’s 25,001 24,699 1% U.S.
8 6 Nokia 24,041 29,440 -18% Finland
9 11 Toyota 22,673 20,784 9% Japan
10 9 Marlboro 22,128 22,183 0% U.S.
11 10 Mercedes 21,331 21,371 0% Germany
12 12 Hewlett-Packard 20,978 19,860 6% U.S.
13 13 Citibank 19,971 18,571 8% U.S.
14 15 American Express 17,683 16,833 5% U.S.
15 16 Gillette 16,723 15,978 5% U.S.
Source: BusinessWeek, Interbrand Corp.

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