From time to time, I like to check how my favorite companies brand value’s have changed over time, especially the best global brands in my portfolio. Is its brand value improving or eroding over time? I look at this data to see how their relevant brands rank and how they have performed over time.
Interbrands ranks the top 100 global brands every year dating back to 2000. They value the brands based on three factors; brand management, strategy/business development and financial metrics. These three components build up to an approximate dollar value of the brand itself and they rank the brands based on the calculated brand value.
In the last 10 years there are many new companies making their way into the top 10. Not surprising, the top ten best global brands are dominated with six companies in technology. This is an increase from four, just ten years ago. I previously owned many of the companies that ranked high in the 2007 ranking, but many of the positions sold off over time, namely McDonald’s, GE and Intel. These positions were disposed of when the valuation of the companies were elevated over my comfort zone.
Three companies that remain in the top 10, I still hold today. IBM remains in the portfolio, but the brand value has been on a steady decline and am still considering whether I want to hold it. IBM declined from third to tenth over the last ten years.
Coca Cola is another in the portfolio and this one will likely be held forever.
I still avoid some of the new entrants, namely Facebook and Amazon. Of the new entrants to the top 10, I purchased just one over the last year.
Top 10 Best Global Brands Compared to 10 Years Ago
2017 Top Growing Brands
As expected Facebook and Amazon were the fastest growing global brands. Both companies continue to disrupt their industries. It is kind of surprising this list isn’t completely filled with technology companies.
Amazon will likely prevail for sometime. They are completely disrupting brick and mortar retail as we know it. If only the valuation of the company would come down to allow for a buying opportunity.
We own undisclosed shares in only one of the companies below in the fastest growing brand category. It interesting to note that Adidas has done well extremely well where other sporting apparel brands have not been as strong. Do you own any of the faster growing brands?
The other interesting one in the list is Pay Pal. At $81.5 billion, the market cap is now slightly greater than American Express. This company and brand has grown substantially over the years.
|Fastest Growing Rank||Brand||Percentage Increase|
2017 Top Brand Declines
This depressing list includes one of our holdings IBM. IBM’s brand continues to decline value. It will be interesting to see if the company can regain their brand dominance in the technology industry. HP and HP Enterprises have the same erosion effect of brand value, while competing in the same industry.
|2017 Biggest Decline||Brand||Percentage Decrease|
2017 New Entrants in the 100 Best Global Brands
In 2017 there are a few new entrants to the 100 Best Global Brands. Not surprising that Netflix and Salesforce have made it to the top 100. I am slightly surprised that Netflix only made it to this list this year.
Ferrari joins the ranks after they were spun off from Fiat Chrysler and grew in value over the last, one of my favorite holdings of recent.
#78 – Netflix
#84 – Salesforce
#88 – Ferrari (spun off from Fiat Chrysler)
Any surprises you seen in the top 10 best global brands? Any company you would have expected to see in the top 10?