American's Most Efficiently Run Brands

The media is filled with brand lists, most of them which are based on research which estimates the value of a given brand. It is hard to connect these valuations to the sales and profits of the companies which own them.

Marlboro is one of the most valuable brands in the world–worth perhaps $50 billion. Does it bring in that much money for its parent companies Altria (NYSE: MO) and Philip Morris (NYSE: PM)? The combined revenue of the two companies is more than $80 billion, so the answer is almost certainly affirmative since Marlboro is the best-selling product for both. Marlboro is a 100-year old brand and produces tens of billion of dollars in sales each year. That would argue for the brand value of the cigarette to be higher than $50 billion. But experts sayit is not.

Google (NASDAQ: GOOG) is another brand which is at the top of most brand valuation lists, and is sometimes given a value of $100 billion. Google’s market capitalization is $150 billion, but annual revenue is only $25 billion. Is the brand value based on sales, or the value of the company in the stock market?

A better way to look at brands is the extent to which they contribute to the market value of the company–the figure that shareholders care about.

24/7 Wall St. asked CoreBrand to give us the Top 100 Brand Equity Value ranks for 2nd quarter 2010. The results show that some of the largest companies in America do not get much of their market value from their names. That may be because they are poorly marketed or that most of a large firm’s business is done through sub-brands like “Windows” instead of Microsoft.

Some of the more modest-sized American companies are highly efficient in terms of brand use. Harley-Davidson (NYSE: HOG) ranks No.4 on CoreBrand list. People who buy its motorcycles view the brand as core to the product. Very few people know the names of their individual motorcycle models .Kellogg is high on the list as are Visa (NYSE: V) and MasterCard (NYSE: MC).Who owns a Southwest Air credit card? Perhaps a lot of people, but the brand of the card is Visa.

Below is the list of the top equity brand values based on data from the end of the second quarter.

Douglas A. McIntyre