ARTICLES AND CASE STUDIES


 

The 100 Top Global Brands 2006

 

The table that follows ranks 100 global brands that have a value greater than $1 billion. The brands were selected according to two criteria. They had to be global in nature, deriving 20% or more of sales from outside their home country. There also had to be publicly available marketing and financial data on which to base the valuation.

 

Here's how we calculate the power in a name:
INTERBRAND TAKES lots of ingredients into account when ranking the world's most valuable brands. To even qualify for the list, each brand must derive about a third of its earnings outside its home country, be recognizable outside of its base of customers, and have publicly available marketing and financial data. One or more of those criteria eliminate such heavyweights as Visa, Wal-Mart, Mars, and CNN. Interbrand doesn't rank parent companies, which explains why Procter & Gamble doesn't show up. And airlines are not ranked because it's too hard to separate their brands' impact on sales from factors such as routes and schedules.

 

BUSINESSWEEK CHOSE Interbrand's methodology because it evaluates brands much the way analysts value other assets: on the basis of how much they're likely to earn in the future. The projected profits are then discounted to a present value, taking into account the likelihood that those earnings will actually materialize.

THE FIRST STEP IS figuring out what percentage of a company's revenues can be credited to a brand. (The brand may be almost the entire company, as with McDonald's Corp., or just a portion, as it is for Marlboro.) Based on reports from analysts at J.P. Morgan Chase, Citigroup, and Morgan Stanley, Interbrand projects five years of earnings and sales for the brand. It then deducts operating costs, taxes, and a charge for the capital employed to arrive at the intangible earnings. The company strips out intangibles such as patents and management strength to assess what portion of those earnings can be attributed to the brand.
FINALLY, THE BRAND'S strength is assessed to determine the risk profile of those earnings forecasts. Considerations include market leadership, stability, and global reach—or the ability to cross both geographic and cultural borders. That generates a discount rate, which is applied to brand earnings to get a net present value. Business Week and Interbrand believe this figure comes closest to representing a brand's true economic worth.

 

 

2006
Rank

2005
Rank

Name

Country

2006
Value
($Mil)

2005
Value
($Mil)

Change in
Value
(%)

Description

 1

 1

Coca-Cola

U.S.

 67,000

 67,525

-1%

Flagging appetite for soda has cut demand for Coke, but the beverage giant has a raft of new products in the pipeline that could reverse its recent slide.

 2

 2

Microsoft

U.S.

 56,926

 59,941

-5%

Threats from Google and Apple haven't yet offset the power of its Windows and Office monopolies.

 3

 3

IBM

U.S.

 56,201

 53,376

5%

Having off-loaded its low-profit PC business to Lenovo, IBM is marketing on  strategic level to corporate leaders.

 4

 4

GE

U.S.

 48,907

 46,996

4%

The brand Edison built has extended its reach from ovens to credit cards, and the "Ecomagination" push is making GE look like a protector of the planet.

 5

 5

Intel

U.S.

 32,319

 35,588

-9%

Profits and market share weren't the only things slammed by rival AMD. Intel's brand value tumbled 9%, as it loss business from high-profile customers.

 

 6

 6

Nokia

Finland

 30,131

 26,452

14%

Fashionable designs &low-cost models for developing world enabled the mobile phone maker to regain ground against competitors.

 

 7

 9

Toyota

Japan

 27,941

 24,837

12%

Toyota is closing in on GM to become the world's biggest automaker. A slated 10% increase in U.S. sales this year will help even more.

 8

 7

Disney

U.S.

 27,848

 26,441

5%

New CEO Robert Iger expanded the brand by buying animation hit-maker Pixar &beefing up digital distribution of TV shows through the Internet &iPods.

 9

 8

McDonald’s

U.S.

 27,501

 26,014

6%

A new healthy-living marketing campaign—and the premium-priced sandwiches and salads that came with it—have led to a fourth year of sales gains.

 10

 11

Mercedes-Benz

Germany

 21,795

 20,006

9%

The new S-Class sedan and M-Class SUV are helping repair a tarnished quality reputation. High costs and weak margins will take longer to fix.

 11

 12

Citi

U.S.

 21,458

 19,967

7%

Already the biggest U.S. bank, Citigroup's quest to generate more revenues from world markets has it introducing its brand to new emerging markets.

 12

 10

Marlboro

U.S.

 21,350

 21,189

1%

It remains firmly in the saddle, particularly outside the U.S., as it expands into developing markets.

13

 13

Hewlett-Packard

U.S.

 20,458

 18,866

8%

Under CEO Mark Hurd, HP is skipping glitzy image ads to push specific products. Improving profits and a 40% stock price increase haven't hurt.

 

 14

 14

American Express

U.S.

 19,641

 18,559

6%

A preeminent financial-services brand among high-end customers, the company is recasting itself as hip to broaden its appeal to a younger set.

 15

 16

BMW

Germany

 19,617

 17,126

15%

It continues to churn out hot models that buyers love to drive &Japanese automakers can't seem to replicate.

 16

 15

Gillette

U.S.

 19,579

 17,534

12%

Gillette's new six-bladed Fusion razor met with ridicule when it was introduced. But with Fusion sales soaring, it is still king.

 17

 18

Louis Vuitton

France

 17,606

 16,077

10%

With a glitzy new flagship on the Champs Elysées, the world's richest luxury brand celebrates yet another year of robust growth.

 18

 17

Cisco

U.S.

 17,532

 16,592

6%

Cisco's decision to lead with its Linksys brand for consumers hasn't made the company a household name yet, but it's helping.

 19

 19

Honda

Japan

 17,049

 15,788

8%

As gas prices rise, Honda's gas sippers are helping the Japanese carmaker gnaw into the Big Three's market share.

 20

 20

Samsung

S. Korea

 16,169

 14,956

8%

It is rolling out hot LCD TVs &ever more powerful memory chips. But it is missing in action with low-end handsets, hurting market share.

 

 21

 25

Merrill Lynch

U.S.

 13,001

 12,018

8%

It has made a dramatic transformation from sleepy, stable brokerage to a lean and mean investment bank.

 22

 23

Pepsi

U.S.

 12,690

 12,399

2%

It tapped a growing obsession with obesity by shifting marketing dollars to Diet Pepsi. Another boost? Rival Coke's move to copy Pepsi Max with Coke Zero.

 23

 24

Nescafe

Switzerland

 12,507

 12,241

2%

Sales of instant coffee are piping hot in emerging markets, while flavored coffees &new products have boosted appeal in Europe.

 24

 38

Google

U.S.

 12,376

 8,461

46%

Its recent inclusion as a verb in the Oxford English Dictionary confirms what competitors feared:Google means search to an army of Web users.

 25

 21

Dell

U.S.

 12,256

 13,231

-7%

The king of the inexpensive PC is trying to regain trust with a campaign to bolster customer service and technical support.

 26

 28

Sony

Japan

 11,695

 10,754

9%

Sony CEO Howard Stringer has fixed the TV biz, but other electronics products are struggling. He's betting PlayStation 3 can help turn things around.    

 27

 26

Budweiser

U.S.

 11,662

 11,878

-2%

A price war and changing tastes left the No.1 beer maker with a nasty hangover. The drop in profits for 2005 was its first in a decade.

 28

 29

HSBC

Britain

 11,622

 10,429

11%

With retail, private, &investment banking operations in 76 countries, the world's local bank is fast becoming a major force in financial services.

 29

 27

Oracle

U.S.

 11,459

 10,887

5%

Last year, Oracle bought another major software brand, Siebel Systems. This year it will have to sew it together and keep its customers happy.

 30

 22

Ford

U.S.

 11,056

 13,159

-16%

The iconic auto brand has declined in every measure. Weak marketing, bad press, shallow product portfolio, and a bottomed-out U.S. stock price hurt value.

 31

 30

Nike

U.S.

 10,897

 10,114

8%

Nike won in both the casual fashion and hard-core athletic markets with innovative new products, marketing, and partnerships.

 32

 32

UPS

U.S.

 10,712

 9,923

8%

China-to-U.S. routes are paying off handsomely, while a big contract to consolidate shipments for Dell is providing a boost back at home.

 33

 34

JPMorgan

U.S.

 10,205

 9,455

8%

Unlike other big banks selling money management units, JPMorgan is building a brand in the business, as merger integration efforts continue.

 34

 36

SAP

Germany

 10,007

 9,006

11%

New software aimed at smaller businesses helped SAP extend its customer base beyond blue chips.

 35

 35

Canon

Japan

 9,968

 9,044

10%

Digital cameras and copiers helped Canon become one of Japan's most profitable companies. New boss Tsuneji Uchida brings technological knowhow.

 36

 33

Morgan Stanley

U.S.

 9,762

 9,777

0%

CEO John J. Mack is overhauling the firm, and its brand, to restore its former reputation as the top investment bank.

 37

 37

Goldman Sachs

U.S.

 9,640

 8,495

13%

Goldman's repeated blockbuster trading results have made it Wall Street's most profitable money machine.

 38

 31

Pfizer

U.S.

 9,591

 9,981

-4%

Sold its over-the-counter unit to focus on developing new prescription drugs—a smart move as powerhouse brands such as Lipitor face generic competition.

 39

 41

Apple

U.S.

 9,130

 7,985

14%

Apple continues to be the style master with its expanded family of iPods and Mac PCs. Its latest hit: the MacBook line of laptops.

 40

 39

Kellogg’s

U.S.

 8,776

 8,306

6%

The cereal maker is striking an effective balance between healthy products like Special K and sugary treats like Pop Tarts to attract both moms and kids.

 41

 42

Ikea

Sweden

 8,763

 7,817

12%

Its affordable Scandinavian designs have helped the Swedish retailer become a household name from San Diego to Shanghai.

 42

 44

UBS

Switzerland

 8,734

 7,565

15%

Melding private banking and investment banking continues to pay off big-time, especially in Europe and Asia.

 43

 43

Novartis

Switzerland

 7,880

 7,746

2%

The Swiss pharmaceutical giant is expanding across everything from prescription drugs to generic medicines, vaccines, and diagnostics.

 44

 45

Siemens

Germany

 7,828

 7,507

4%

New CEO Klaus Kleinfeld has disposed of poor-performing telecom units, allowing Siemens to focus on businesses such as medical equipment.

 45

 46

Harley-Davidson

U.S.

 7,739

 7,346

5%

Still the king of the hogs. Growing sales to women augment the loyal customer base of baby boomers and hard-core bikers.

 46

 49

Gucci

Italy

 7,158

 6,619

8%

Designer Frida Giannini still can't match predecessor Tom Ford's star power. But sales of apparel and leather accessories are growing nicely.

 47

 55

eBay

U.S.

 6,755

 5,701

18%

Investors may not like increasing competition from the likes of Google, but TV ads keep boosting the online marketplace's brand appeal.

 

 

 48

 53

Philips

Netherlands

 6,730

 5,901

14%

Buoyed by the success of its medical equipment and high-tech consumer gadgets, Philip's focus on cutting-edge, easy-to-use products is paying off.

 49

 51

Accenture

Bermuda

 6,728

 6,142

10%

Bundling consulting and outsourcing gigs is helping Accenture stay fierce. Last year, sales grew by more than twice the rate of other tech-services firms.

 50

 48

MTV

U.S.

 6,627

 6,647

0%

Now 25, MTV is pushing into broadband with the MTV Overdrive site, where it faces competition with MySpace and YouTube for teens' attention.

 51

 50

Nintendo

Japan

 6,559

 6,470

1%

Nintendo is No.1 in portable video-game consoles, but the unconventional new Wii console machine due out this autumn could be a harder sell.  

 52

 40

Gap

U.S.

 6,416

 8,195

-22%

Still searching for its fashion identity, the clothier's sales are fraying as it struggles to dress the twentysomething crowd for both work and weekend.

 53

 52

L’Oreal

France

 6,392

 6,005

6%

This French cosmetics maker's finances are looking prettier, thanks to a rebound in sluggish European sales.

  

 54

 47

Heinz

U.S.

 6,223

 6,932

-10%

Slimming its portfolio and adding products like Lea & Perrins hasn't been enough for Heinz to compete with retailers' in-house brands.

 55

 58

Yahoo!

U.S.

 6,056

 5,256

15%

The company risks looking like an also-ran next to Google, but Yahoo is mining for hits in new areas like social networking and digital content.

 56

 56

Volkswagen

Germany

 6,032

 5,617

7%

Maybe the most resilient brand in its industry. VW is solving its quality and financial issues, and customers are coming back.

 57

 54

Xerox

U.S.

 5,918

 5,705

4%

Xerox' stable of color copiers is bringing in a good supply of cash, but it has yet to make its mark in the digital world.

 58

 60

Colgate

U.S.

 5,633

 5,186

9%

Well into a four-year restructuring, Colgate now has something to smile about with new launches such as Luminous toothpaste finding strong demand.

 59

 57

Wrigley’s

U.S.

 5,449

 5,543

-2%

With new players chewing away at market share, Wrigley's has been expanding into areas like candy and mints with brand extensions and acquisitions.

 60

 61

KFC

U.S.

 5,350

 5,112

5%

Avian flu fears in early 2006 slowed KFC's growth in China, the chain's hottest market, but KFC sales are rebounding.

 61

 65

Chanel

France

 5,156

 4,778

8%

Fresh-faced Keira Knightly is replacing bad-girl Kate Moss as the face of Coco Mademoiselle perfume.

 62

 59

Avon

U.S.

 5,040

 5,213

-3%

Avon ladies have been struggling. Poor results in many markets, including Eastern Europe, forced CEO Andrea Jung to launch a restructuring this year.

 63

 66

Nestle

Switzerland

 4,932

 4,744

4%

Best known for chocolate, Nestlé posts stronger growth from other products, such as Nestlé Aquarel bottled water.

 64

 64

Kleenex

U.S.

 4,842

 4,922

-2%

A mature brand that's working to fend off commodity status. Emotional advertising is helping buoy its image against private labels.

 65

 68

Amazon.com

U.S.

 4,707

 4,248

11%

Heavy spending on technology for digital media initiatives has depressed the stock, but free shipping and reliability keep customers happy.

 66

 63

Pizza Hut

U.S.

 4,694

 4,963

-5%

Pizza Hut sales have been drooping as Americans turn increasingly to sandwiches and Mexican fare.

 67

 67

Danone

France

 4,638

 4,513

3%

A growing global appetite for yogurt keeps the French food and beverage giant in good health.

  

 68

 70

Caterpillar

U.S.

 4,580

 4,085

12%

Demand for Caterpillar's rugged machines and engines has never been stronger. Cat is on track to top $40 billion in sales this year.

 69

 73

Motorola

U.S.

 4,569

 3,877

18%

New products like the RAZR and SLVR have been a hit, & a hip marketing campaign behind them is adding luster to the Moto brand.

 70

 62

Kodak

U.S.

 4,406

 4,979

-12%

Kodak has defied skeptics by becoming a major player in digital photography and printing, but profits remain disappointing.

 71

 71

adidas

Germany

 4,290

 4,033

6%

The World Cup was a bonanza for the sports-apparel maker. Securing the sponsorship helped keep archrival Nike at bay before the world's largest audience.

 72

 72

Rolex

Switzerland

 4,237

 3,906

8%

Rolex remains the ultimate luxury brand worldwide, and with strong sales in China, its appeal continues to spread.

 73

 77

Zara

Spain

 4,235

 3,730

14%

With its focus on high fashion at low prices, Europe's biggest clothing retailer is so popular that it's opening more than a store a day in 2006.

 74

 79

Audi

Germany

 4,165

 3,686

13%

Eye-catching design, hot technology, and a new American-size SUV called the Q7 are transforming Audi into a serious global rival to BMW and Mercedes.

 75

 84

Hyundai

S. Korea

 4,078

 3,480

17%

Fast shedding its image as a cheap automaker. In the latest J.D. Power quality survey of new car owners, Hyundai was No.3, behind Porsche and Lexus.

 76

 75

BP

Britain

 4,010

 3,802

5%

Not even an Alaskan oil spill or an explosion at a Texas refinery has put a dent in BP's strong performance.

 77

 78

Panasonic

Japan

 3,977

 3,714

7%

It's a force in flat-screen TVs, digital cameras, and chips but hasn't turned first-rate technology into better brand equity.

 78

 74

Reuters

Britain

 3,961

 3,866

2%

The global news and financial information giant is moving into derivatives trading with a collaboration with the Chicago Mercantile Exchange.

 79

 69

Kraft

U.S.

 3,943

 4,238

-7%

Fierce competition and rising commodity costs have dogged the U.S.'s largest foodmaker. Kraft's new CEO needs innovative new products to revive sales.

 80

 76

Porsche

Germany

 3,927

 3,777

4%

ceo Wendelin Wiedeking extends his 10-year winning streak with perfect timing and precision execution on the Cayman.

81

 82

Hermes

France

 3,854

 3,540

9%

Best known for leather accessories and silk scarves, Hermes is riding high on the success of a new perfume, Un Jardin Sur le Nil.

 

 

 

 82

 81

Tiffany & Co.

U.S.

 3,819

 3,618

6%

With sales sparkling in many markets, the retailer's focus on service and design has helped it battle a new set of discount online competitors.

 83

 86

Hennessy

France

 3,576

 3,201

12%

As the brand gets a marketing assist from adoring hip hop artists in the U.S., the French cognac maker is pushing for growth in China and India.

 84

 80

Duracell

U.S.

 3,576

 3,679

-3%

Duracell has been gaining share in the market for premium replaceable batteries, but will rechargeable batteries threaten the long-term outlook?

 85

 87

ING

Netherlands

 3,474

 3,177

9%

ING continues its global expansion moving beyond its banking and insurance roots into the asset management business. 

 86

 89

Cartier

France

 3,360

 3,050

10%

The popularity of Pasha timepieces and Caresse d'Orchidées jewelry is putting a sparkle in Cartier sales.

 87

 92

Moet & Chandon

France

 3,257

 2,991

9%

Global sales of Champagne are up 54% since 1990, & Moet's "Be Fabulous" campaign has cemented the brand in the center of market.

  

 88

 91

Johnson & Johnson

U.S.

 3,193

 3,040

5%

There's more than one way to grow, as J&J showed by paying $16.6 billion for Pfizer's consumer-products unit.

 

 89

 90

Shell

Britain

 3,173

 3,048

4%

Despite pension problems and pipeline explosions, soaring oil prices fueled Shell to record 2005 profits of $23 billion.

 90

 85

Nissan

Japan

 3,108

 3,203

-3%

Starved for new models, Nissan's sales have slipped. New launches, including a remodeled Altima, will be a timely boost for CEO Carlos Ghosn.

 91

 99

Starbucks

U.S.

 3,099

 2,576

20%

Starbucks brings in customers with lifestyle marketing, pushing music, books, and lunch food to get them to stick around.

 92

 NA 

Lexus

Japan

 3,070

 NA 

NA

Toyota's relatively young Lexus premium brand is No.1 in the U.S., but it's just getting started in Asia and Europe.

 93

 88

Smirnoff

Britain

 3,032

 3,097

  -2%

The vodka market continues to attract new entrants; Smirnoff needs to better define a sophisticated identity to stay ahead of the pack.

 

  

 94

 97

LG

S. Korea

 3,010

 2,645

14%

This Korean electronics maker is emulating its crosstown rival, Samsung, boasting stylish handsets and digital TVs.

 95

 94

Bulgari

Italy

 2,875

 2,715

6%

Italian jeweler Bulgari is powering growth with the help of a super-luxury hotel chain and customers like Madonna.

 96

 93

Prada

Italy

 2,874

 2,760

4%

Anti-Establishment Italian fashionista Miuccia Prada keeps testing the frontiers of taste: Edgy clothing design, edgier store architecture.

 97

 95

Armani

Italy

 2,783

 2,677

4%

Fashion icon Giorgio Armani proves his appeal extends beyond the closet, as he expands into everything from minimalist sofas to five-star resorts.

 98

 NA 

Burberry

Britain

 2,783

 NA 

NA

Moving beyond its signature plaid, Burberry is beefing up its accessories line and expanding its retail profile in the U.S.

 99

 98

Nivea

Germany

 2,692

 2,576

4%

In a bid to shed its austere image, the company is expanding into new products such as skin-firming lotion and men's eye cream.

 100

 96

Levi’s

U.S.

 2,689

 2,655

1%

This iconic brand is fighting to stand out among such high-end names as Earnest Sewn and, at the mass level, discounters' private-label jeans.

 

                                    Submitted by : Sadia Naeem Awan

 

 

 

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