Coca-Cola Named Most Powerful Brand, Followed by Hershey
How much does a brand contribute to a company’s value? The answer to that question is likely to produce different answers depending on who’s talking. A chief financial officer may have a far different view than a chief marketing officer.
One answer, cited by Tenet Partners in its 2016 Top 100 Most Powerful Brands report, refers to a study by Ocean Tomo showing that “roughly 84% of the value of the S&P 500 is made up of intangible assets including corporate brands.” Tenet has tracked nearly 1,000 companies in 50 industries to develop its CoreBrand Index to measure the value that a brand contributes to enterprise value.
Tenet’s Brand Equity Valuation combines the percentage of a firm’s market capitalization attributable to the brand with a corresponding dollar value. The research firm’s BrandPower score measures a brand’s familiarity (awareness) and favorability scores. Combining the equity valuation and the BrandPower score, Tenet derives a brand value.
Interestingly, the most powerful brands measured by BrandPower rank and the brands with the highest brand values are not identical. Here are the top five brands by BrandPower rank:
- Coca-Cola, from Coca-Cola Co. (NYSE: KO)
- Hershey, from Hershey Co. (NYSE: HSY)
- Walt Disney, from Walt Disney Co. (NYSE: DIS)
- Apple, from Apple Inc. (NASDAQ: AAPL)
Coca-Cola and Hershey have held down the top two spots for five years running. Bayer has jumped six places in the past five years, Disney has jumped 11 and Apple has jumped 39.
The 11th highest BrandPower rank belongs to Harley-Davidson Inc. (NYSE: HOG), something of an anomaly when you consider the size of its market cap (about $8.8 billion) compared with, say, Apple’s $547 billion market cap.
By brand value the top five are:
- Apple, $102.5 billion
- Google, from Alphabet Inc. (NASDAQ: GOOGL), $92.3 billion
- Microsoft, from Microsoft Corp. (NASDAQ: MSFT), $79.6 billion
- GE, from General Electric Co. (NYSE: GE), $52.7 billion
- Exxon Mobil, from Exxon Mobil Corp. (NYSE: XOM), $51.7 billion
That consumer staples’ brands like Coca-Cola and Hershey top the list should be no big surprise. More surprising, perhaps, is that the top category among Tenet’s Top 100 is retail, with 13 companies on the list.
Most surprising, however, has to be that the highest ranked retailer in the Top 100 is Barnes & Noble Inc. (NYSE: BKS) at 32nd place. Wal-Mart Stores Inc. (NYSE: WMT) is ranked 53rd, one spot ahead of Amazon.com Inc. (NASDAQ: AMZN) at 54th.
Wal-Mart has gained 15 notches in the rankings since 2011, but Amazon has gained a whopping 83. Between the 2015 and 2016 rankings, Amazon moved up 15 places in the rankings, more than any other company.
The full report on the Top 100 Most Powerful Brands is available here.
Methodology: Tenet’s findings are based on a full calendar year of data to support its brand rankings, which include over 10,000 interviews with influential decision makers with broad reach. Survey participants hail from the top 20% of corporations in the United States (based on revenue), are carefully screened and represent investment communities, potential business partners and customers and highly engaged consumers.