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Coca-Cola - Best Global Brand 2009

21 Sep 2009

NEW YORK, US: The Best Global Brands 2009 rankings were announced late last week by Interbrand, in conjunction with Business Week. The 10 top brands (in highest ranking order) are Coca-Cola; IBM; Microsoft; GE; Nokia; McDonalds; Google; Toyota; Intel; and Disney.

Largest risers in brand value areGoogle (25%); Amazon.com (22%); Zara (14%); Nestlé (13%); and Apple (12%); and the largest decliners are Morgan Stanley (-26%); American Express (-32%); Harley-Davidson (-43%); Citi (-49%) and UBS (-50%).

The presentation covered some of the issues facing brands and their role in economic recovery:

Fallout and resetIn recessionary times, marketers must compete harder for hard-earned money. In this recession, trust was an important underpinning for both brands that did and did not do well on ranking.

Trust for brands that did well is seen in an overall increase in the CPG sector, with Nestlé (13%) leading the growth in brand value and Wrigley (10%), Danone (10%), Heinz (9%) and Kellogg's (7%) all benefiting from being value purchases that provide instant gratification from customers that count on consistency of quality and experience.

The economic crisis pounded away brand value and financial recovery for these businesses will be easier than restoring lost confidence in the business and the brand as trustworthy organisations.

Other than the uber-luxury car brand Ferrari, anything with wheels saw a loss in brand value. For UPS, less trade in recessionary times meant fewer parcels going around. For Harley-Davidson, purchases of the American icon came to a screeching halt with the end of discretionary spending in a recession. The car brands all took a loss as sales slowed.

Many luxury brands held their own in the current economic conditions. The true luxury brands like Hermès (1%), Gucci (-1%), Prada (-2%) and Louis Vuitton (-2%) fared well showing that connoisseurs of luxury are recession-proof shoppers. Armani (-6%) and Tiffany & Co (-5%) had both made moves to go more mainstream in past years and suffered as the middle-ground of retail was hardest hit by the economic downturn.

Easy to consume, relatively low cost brands have done well this year. New entrants all hail from the B2C space and include Lancôme, Burger King, Adobe, Puma, Burberry, Polo Ralph Lauren and Campbell's.

Innovation divide

There seem to be two types of technology brands this year - those that innovate and those that don't. With a lot of moving parts in the tech space, brands are adjusting and repositioning throughout the category.
Cost based innovators are heating up competition. The leader, Intel (-2%), is keeping pace with innovations like Atom to capture share of the growing netbook market.
Newcomer Adobe is defining is market, owning more than 80% market share for online video (used by YouTube) and stretching into new areas with Adobe TV and the Adobe Media Player
HP (2%) and Samsung (-1%) are doing well, while their core competitors Dell (-12%) and Sony (-12%) continue to trail behind.
Yahoo! (-7%) falls further behind Google (25%) without a compelling case for consumers as to why it is relevant.
Brand leaders like Google (25%), Apple (12%), BlackBerry (7%) and Nintendo (5%) remain pillars of smart brand management.
Internet retailer Amazon (22%) is one of the top five value gainers this year as it rides a wave of success from the Kindle and more consumers turning to online comparative shopping. Online auctioneer eBay (-8%) is struggling to guarantee the quality of its products after a series of lawsuits over luxury counterfeit.

10-year trends

How leaders create and manage value within their category.

Across many categories, cost based innovators - brands that have changed the value equation to deliver more for less - are performing relatively better in this recession. Zara (14%), H&M (11%) and Hyundai (-5%) are two current examples of brands in hard-hit sectors that are faring better than competitors thanks to a proposition that resonates well with consumers at this time.
Many brands have been single-minded, even obsessive, about staying true to their brand. Coca-Cola stands out as the ranking leader for the past decade, while Apple (12%) and BMW (-7%) are continued examples of this type of thought leadership in brand management.
Changes in the marketplace end up exposing some brands as complacent, or lagging after once leading. Gap (-10%), Yahoo! (-7%) and Dell (-12%) once enjoyed a market leadership position but now struggle to remain relevant and differentiated. The interesting thing about these legacy but now lagging brands is that they have the most risk and opportunity potential of any brands studied.
In every category, there are iconic brands that set the course for others to follow. IBM (2%), McDonald's (4%), Disney (-3%), Intel (-2%), and Budweiser (3%) are all brands that invest, innovate and deliver with a consistency of performance. They recognise that one size does not fit all and offer a range of options within their portfolio. These are the brands that define the way things are, should look to in times of crisis and brands that will define the future.
To be successful, brands must be honest about who they are and where they sit on the competitive spectrum; listen to their customers rather than doing what is right for their business; and grow from the core.

Role of brands in a recovery

Brands will play an increasingly important role as the economy recovers and business work to restore trust and confidence.
Over 10 years, the survey has seen that brand value remains relatively more stable than most stock market indices
Brands are vessels for a company's values and the thing consumers rely on over time for consistent delivery and experience. As the market dynamics change, brands act as a compass
Brands play a larger role in determining choice, and as companies work to repair their reputation, it is the brand that will drive selection
Recession spurs innovation but as innovation is broadly applied, differentiation erodes. Brands on the other hand commoditise at a slower rate and protect earnings. Point is, innovate from the core of your brand.

“Trust, transparency and responsibility are critical to a company's success. We have witnessed first-hand the repercussions of blind trust, backroom deals and greed in business. This has brought about a tremendous mistrust of how businesses behave and intolerance for companies that say one thing and do another, particularly as digital and social media networks are able to expose, monitor and react to news at unprecedented speed,” concludes Jeremy Sampson, executive chairman, Interbrand Sampson Group.

Download the Best Global Brands 2009 presentation.