Principles of Marketing

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2007

BRANDZ



Top 1 Most Powerful Brands
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Contents
About the BRANDZ™ Top 100 Ranking

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How We Calculate Brand Value

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Key Insights

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Sector Highlights

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BRANDZ™ Top 100 Brand Ranking Charts

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Frequently Asked Questions

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About Millward Brown Optimor

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About the BRANDZ Top 100 Ranking
As economies become global and information more critical, intangible assets have replaced tangibles as a major source of shareholder value. Of these intangibles, brands are often the most valuable assets, accounting for approximately one third of the value of today's Fortune 500 companies. The ability of brands to create such enormous value captivated the financial community. It's the reason why we developed a ranking of the world's most financially powerful brands. The BRANDZ™ ranking is the first to combine publicly available financial data with primary research data. The ranking was developed by Millward Brown Optimor, the brand finance and ROI unit of leading market research and consultancy Millward Brown.

Driven by primary research insights, the BRANDZ ranking provides actionable information for marketing, finance and business professionals that can drive decision making into managing and growing a company’s brand assets. The primary research comes from WPP's BRANDZ, the world's largest brand equity database for which Millward Brown has interviewed over 1 million consumers about almost 40,000 brands worldwide. The BRANDZ ranking provides sector and geographic coverage of market facing brands, including brands in Apparel, Beer, Cars, Fast Food, Financial Services, Luxury Goods, Mobile Communications, Motor Fuel, Personal Care, Retail, Soft Drinks, and Technology. It covers brands in developed markets currently driving world GDP, and emerging markets whose share of world GDP is expected to grow in the future. The ranking is based on the brand’s ‘dollar value’, calculated by using an economic use approach; the brand value shown in our ranking is based on the present value of the earnings that the brand is expected to generate in the future. The BRANDZ Top 100 provides two metrics of brand performance in addition to brand value: Brand Contribution and Brand Momentum. Brand Contribution quantifies the share of the company's earnings attributable to the brand. Brand Momentum is an index of a brand’s short-term growth rate (1 year). BRANDZ is a diagnostic and predictive brand equity measurement tool that was developed for WPP’s operating companies by Millward Brown in 1

998 and has been running every year since then. It is based on Millward Brown’s established BrandDynamics™ framework. BRANDZ data is collected from interviews with category buyers or users (e.g. new car owners) who are asked about brands within a competitive framework (e.g. BMW, VW, Ford, Toyota etc).

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How We Calculate Brand Value
Brand value is the financial value of a brand, defined as the sum of all earnings that a brand is expected to generate. For the purpose of the BRANDZ ranking, Millward Brown Optimor values brands in three steps: Establish a company's intangible earnings and allocate them to individual brands and countries of operation, based

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on publicly available financial data from Bloomberg, Datamonitor (www.datamonitor.com) and Millward Brown Optimor's own research.
Determine the portion of intangible earnings attributable to brand alone, as opposed to other factors such as price.

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This metric, known as Brand Contribution, reflects the share of earnings from a product or service's most loyal consumers or users. For this second step, we use research-based loyalty data from the BRANDZ database.

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Project the brand value forward based on market valuations, the brand’s risk profile, and its growth potential. Data for this step is sourced from the BRANDZ database, Bloomberg and Millward Brown Optimor's own research.

Corporate Earnings

Brand
Value

‘Branded’...
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