Among the multitude of rankings in the business world, the most prestigious are the Fortune 500 Global and the BrandZ Top 100 Most Valuable Global Brands lists.
The former ranks companies based on their past performance while the latter ranks them according to their potential. On June 11, the 2019 BrandZ Top 100 Most Valuable Global Brands list was released in New York. Amazon topped the rankings, replacing Google, which was the previous champion.
Fifteen Chinese brands were included on the list this year. Alibaba was the frontrunner among the Chinese brands. China Life, Bank of China and SF Express, three Chinese brands included on the 2018 list, did not make the 2019 list. This year's newcomers from China were Haier, Meituan, Didi and Xiaomi. Of the 12 Chinese brands that remained on the list, Alibaba, Ping An and Huawei moved up while Tencent and eight other brands moved down. BrandZ's brand value system is a reminder that brand value is not necessarily directly proportional to firm size as global brand value must be endorsed by a global customer base. The importance of branding to competitiveness and sustainability is clear. The list shows that the combined value of the top 100 brands stands at $4.7 trillion, representing a year-on-year increase of $328 billion, or 7.5%.
Thirty-four of the brands that remained lost brand value, with GE experiencing the steepest decline, down 32%.
Fifty-seven achieved a higher brand value, among them the nine new entrants and Instagram, whose brand value soared 95%. The new champion Amazon saw its brand value surge 52%. Other high-achievers which enjoyed 50%+ increases in their brand value included Netflix (65%), Salesforce (58%), Adobe (57%) and Uber (51%).
The six brands with the highest increases in value owe their success to the transformation of their business models, Amazon's success comes from the success of its service partners on the Amazon platform, while Haier's success comes from the successful transformation of its empowered ecosystem brands within Haier's IoT ecosystem.
Netflix has shifted its business from DVD rentals to a video streaming platform. Salesforce has repurposed itself from a software vendor to a cloud-based industrial ecosystem.
The common theme is that Netflix, Amazon and Haier, through business model innovations, have created industrial ecosystems where third parties can "win." Co-creation for win-win outcomes is a proven business model as well as a brand value proposition.
The Store WPP EMEA and Asia CEO and BrandZ Chairman David Roth said, "We see a new trend of moving away from the delivery of a single product and service toward a disruptive ecosystem. Brands that want to succeed in the future must understand the value this model could potentially unlock and embrace this model willingly."
Based on a study of the new models, BrandZ has introduced a new category on its 2019 list - the IoT ecosystem. Haier was the first brand to be placed in this category. Haier's brand value was assessed against the criterion of "an ecosystem consisting of multiple interrelated companies," a fitting articulation of Haier's brand value.
Experts said that the emergence of the IoT ecosystem as a category could potentially lift a prolonged headache for analysts. An IoT ecosystem brand can build an industrial ecosystem through business model innovations, generate ecosystem revenue, break the iron law of diminishing marginal gains, and in turn break through traditional barriers and become a world-class ecosystem brand in the IoT era.
