Best Global Brands 2016: Apple Retains the Top Position Albeit With Negligible Growth

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Apple Inc. (NASDAQAAPL) and Google (NASDAQ: GOOGL), once again, claimed the top positions for the fourth consecutive year in the list of Best Global Brands 2016 by Interbrand, a global brand consultancy. Apple’s brand value surged by a small 5% to $178.11 billion, albeit less compared to 43% growth in the previous year. The decline in growth might be due to poor sales performance of iPhone 6S which was not appreciated by the fans due to the lack of innovation. Google retained the second spot with the brand value of $133.25 billion. CocaCola also secured the third place, again, but its brand value saw a decline by 7% to $73.1 billion from $78.42 billion in 2015. Surprisingly, International Business Machine Corp (NYSE: IBM) is an another company which recorded a huge 19% decline in its brand value, standing at the 6th position, due to its declining sales. Since iPhone 7 also lacks innovation, Apple might lose its top position to Google in the next year as it has already made an innovative entry into the hardware segment as well.

According to Interbrand, the Korean electronic giant Samsung has been ranking in the list of top 10 global brands for the past five years. This year also the company is holding the 7th position with a brand value of $51.8 billion, an increase of about 14% from last year.

The cumulative value of the top 100 brands in 2016 is $1,796 billion, an increase of 4.8% from 2015.

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The Tech & Automotive Companies Rule the Charts Again

Technology and automotive companies continue to dominate the overall Interbrand’s rankings. Together, they secured 29 positions in the list. Tech giants, once again, ruling the list of top 10 most valuable global brands: Apple, Google, Microsoft and Samsung. A total of 14 brands made the place on the top 100 list with an average brand value growth of 8.3%. The total valuation of these brands stood at $623.19 billion at 34.7%, which is the highest, dominating the overall listing as well. The social media giant Facebook has recorded the maximum surge (48%) in its brand value in this sector, followed by Adobe (21%), Huawei (18%) and Samsung (14%). It won’t be surprising if Facebook makes a position in the list of top 10 valuable brands in the coming year as the company keeps innovating and adding more and more functionality and features. In this era of technology, the growth and share are not at all surprising. Technological advancements are being adopted by the people as well as the businesses at a very high speed, fearing that one day it might take over human capabilities.

The Automobile sector also showed a significant increase of 9.5% in its brand value which is more than the tech industry. However, this sector comprised 14.28% of the total valuation in the table with $256.6 billion. A total of 15 brands made their place in the table, but only Toyota and Mercedes-Benz have secured their position in the list of top 10 brands. The highest gainer in this sector is Nissan (22%), followed by Mercedes-Benz (18%), Porche (18%) and Audi (14%).

Tesla, a new entrant, has earned a position in the list, albeit the last. Recently, Tesla has been in the news regularly for its innovations and developments from building driverless cars to taking people to Mars.

Even though there were just three brands from the Retail Sector, it recorded the highest growth in its brand value with 18.8%. Amazon, eBay and IKEA are the only three brands to get into the top 100 list. The e-commerce giant Amazon is one of this year’s top growing brand and witnessed 33% improvement in its brand value. Overall, the retail sector added 4.5% to the total valuation of the table by $81.3 billion.

Methodology

Brand value is the most important factor that influences the growth of business. Strong brands influence choice and loyalty of a customer by attracting and retaining them.

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The rankings are based on three key components which are:

  • Financial Forecast
  • Role of Brand and
  • Brand Strength

Conclusion

The list suggests that the retail segment has high growth potential in the future as well with Amazon leading the sector currently. This sector is estimated to reach $22.4 trillion by 2020.

Facebook has emerged as the fastest growing company. Even in 2015, Facebook registered a growth of 54% in its brand value.

Brands need to focus the most on creating higher brand values which can be done only through innovation in this constantly advancing technological era. Innovation is the key factor in attracting more and more consumers and businesses. The brands need to set their priorities right to reach the next level.

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