Monday, May 9, 2011

Is BrandZ better than Brand X?

Continuing with an Apple theme…although this post really has nothing to do with Apple but rather the value of information…, Apple was ranked by BrandZ as the world's most valuable brand. The report is produced by Millward Brown Optimor, a brand strategy and financial consultant. Basically, the report is a marketing strategy to advance Millward Brown's brand. But, for some reason, they publish it under the name BrandZ. I'm sure they know what they are doing.

The first thing I noticed was that some of the companies in the top 10—the best brands in the world—which Apple beat out were: McDonald's (4), Coca Cola (6), and Marlboro (8). So, congratulations Apple, you are ever so slightly better than an obese maker, a sugar water manufacturer and a purveyor of death.

What does brand value mean? Well, put simply, they take the financials and back out products that don't depend on the brand. For example they would back out sales of any healthy Coca Cola products, like Minute Maid. Then they add survey opinions from some customers. How many? They say 2 million in 13 years, but this is only the 6th annual rating. Why they would give the "2 million in 13 years" figure makes no sense for this year's rating, so I can only guess they surveyed less than 150,000…perhaps much less. Finally, they add a predictive value of what they think the future holds for growth potential. They are analysts, don't forget. (See Myk's quoted Niels Bohr comment.)

So, in a nutshell, they start with real financial data, add opinions from surveys, and add their own opinions. That leaves us with a rewriting of the Fortune 500 modified by some people's opinions or an award show for brands where we start with box office reciepts. Meh.

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