Lego beats Apple as world’s most powerful brand
Lego beats Apple as world’s most powerful brand
Apple may be the world’s most valuable brand at $128.3bn, but children’s favourite Lego has topped the charts as the world’s most powerful brand.
Lego has just knocked Ferrari off the top spot (it’s now 9th), scoring highly on a wide variety of measures on Brand Finance‘s Brand Strength Index. These include familiarity, loyalty, promotion, staff satisfaction and corporate reputation.
I wrote about Lego for Neal Schaffer’s Maximize Social Business blog a couple of years ago by looking at how Lego was empowering employees to use social media.
What makes a brand powerful and why does it matter?
Let’s take a look at the results from this year’s Global 500 2015 from leading brand valuation and strategy consultancy Brand Finance, who put thousands of the world’s top brands to the test each year.
The results from their latest study were released today.
The most powerful brands are:
- Red Bull
- McKinsey Company
- Walt Disney.
The most valuable brands are:
- Samsung Group
- China Mobile
What is a brand?
Brand Finance says: “In the very broadest sense, a brand is the focus for all the expectations and opinions held by customers, staff and other stakeholders about an organisation and its products and services”. (Tweet this)
However, when looking at brands as business assets that can be bought, sold and licensed, a more technical definition is required. Brand Finance helped to craft the internationally recognised standard on Brand Valuation, ISO 10668.
That defines a brand as “a marketing related intangible asset including, but not limited to, names, terms, signs, symbols, logos and designs, or a combination of these, intended to identify goods, services or entities, or a combination of these, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits/value”.
Brand Strength is the part of Brand Finance’s analysis most directly and easily influenced by those responsible for marketing and brand management. In order to determine the strength of a brand they have developed the Brand Strength Index (BSI).
They analyse marketing investment, brand equity (the goodwill accumulated with customers, staff and other stakeholders) and finally the impact of those on business performance.
Following this analysis, each brand is assigned a BSI score out of 100, which is fed into the brand value calculation.
Based on the score, each brand in the league table is assigned a rating between AAA+ and D in a format similar to a credit rating. AAA+ brands are exceptionally strong and well-managed while a failing brand would be
assigned a D grade.
Lego is a well-loved and strong brand, but thanks in part to the Lego Movie, it has catapulted to be the world’s most powerful, after taking nearly US$500m since its release a year ago.
Lego’s appeal spans generations; as well as the creative freedom it gives children, the brand appeals to the nostalgia of adults. It generally avoids gendered marketing, by appealing to boys and girls equally, Lego maximises the size of its target demographic.
Brand Finance says that approach also pleases parents, as concerns mount over the effect toys may have on the outlook and ambitions of children, and girls in particular – couldn’t agree more!
Apple’s core value
Apple has the highest brand value in history.
According to Brand Finance, what sets Apple apart is ability to monetise that brand. Apple has a remarkable knack for using its brand to popularise and hence monetise existing technology, as it did so successfully first with the mp3 player, smart phone and later the tablet.
Critics have been silenced by the success of the iPhone 6 and 6 Plus. Consumers have snapped latest models in their droves, helping Apple set records for quarterly profits ($18bn) and company value ($710bn).
Twitter is the fastest growing brand; it has almost tripled its brand value in a year, increasing from $1.5 billion in early 2014 to $4.4 billion now.
Fellow tech giants Baidu and Facebook have also grown strongly, by 161% and 146% respectively. The three appear to be more effectively managing the transition to mobile advertising than other tech players such as Google, boosting expectations of the financial potential of their brands
A couple of years ago I was interviewed about this topic for a book – #Brandvandals: Reputation Wreckers and How to Build Better Defences: Corporate Reputation Risk and Response by Stephen Waddington and Steve Earl (Bloomsbury, 2013).
It looked at brand vandals and examined the damage that Internet-empowered individuals can cause organisations.
#brandvandals states: “For the organisation, engagement isn’t an option – it’s a necessity. Brand vandals are forcing a level of dialogue that organisations, public and private, have never had to contemplate before. Smart organisations are helping to define the future of modern brand communication by retooling their public relations and communications teams to truly get to grips with the challenge of engaging audiences in a 24/7 conversation that not only answers criticism, but positively rebuilds corporate reputation.”
I recommend reading it if you’re interested in finding out more about brands and the role reputation plays.
I created a short SlideShare of information from the book I think is relevant for internal communicators, which you can see below:
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