Many brands in the list of world’s top 100 brands are in a state of stagnation, according to Interbrand’s Best Global Brands 2023 ranking. The rate of growth in the overall brand value slowed sharply after a significant rise last year, increasing 5.7 pc this year as against 16 pc, taking the total brand value to $3.3 trillion from $3.1 trillion in 2022.
Lack of growth mindset, weaker brand leadership, and poor forecasting are reasons behind the slowdown, Interbrand said. This follows a longer-term trend where brands operating exclusively in one sector taking an incremental approach have experienced slower growth in brand value.
Gonzalo Brujó, Global CEO, Interbrand, said, “After a few years of strong brand growth, we have entered a period of stagnation, with this year’s table showing moderate growth in overall brand value among the world’s biggest brands. Businesses which have witnessed a rise in brand value, including Airbnb (#46), LEGO (#59) and Nike (#9) have all transcended their established category norms and play a more significant and meaningful role in society and consumer’s lives.
“As we continue to navigate economic and environmental headwinds, there is a need for improved business cases and better brand management to drive future investment and sustain growth within traditional sectors and beyond. Those who can successfully leverage their brand into new consumer pools of potential will reap the rewards of strong brand growth.”
Analysis shows companies that address a diverse set of customer needs, often across sectors, dominate the top of the table, making up almost 50 pc of the total value. Based on the data, these companies are more stable, achieve higher top-line growth, remain more profitable, and benefit from a greater growth of brand value.
Ashish Mishra, Chief Executive Officer, Interbrand India & South Asia, said, “A brand like Apple can no longer be ascribed to a sector. It competes across different arenas, helping its customers connect (the iPhone), but also thrive (the latest Apple watch was positioned as a health device), fund (its new savings account drew nearly $1 billion in deposits in the first four days), and much more. Apple’s move across Arenas has enabled it to hold the BGB top spot for the 11th year, having overtaken Coca Cola in 2013.”
This year’s BGB report highlights the disproportionate rate of growth for brands that move beyond their narrow categories to operate across multiple ‘Arenas’.
Kathleen Hall, Chief Brand Officer, Microsoft, said, “We are honoured to be recognised for continued strong growth in the Best Global Brands ranking this year. The combination of brand perception and financial performance is a great indicator of brand health and relevance and one we value tremendously. With our acquisition of Activision Blizzard, our prominent leadership position in AI, and our continued commitment to make a positive impact on society, we aspire to be a brand people can trust and build a responsible future with.”
Guillaume Le Cunff, CEO, Nestlé Nespresso SA, said, “Since the beginning, sustainability has been at the heart of the Nespresso brand and we have worked hard to show coffee can be a force for good. This is a very proud moment to see Nespresso recognised in Interbrand’s Best Global Brands ranking for the first time. And we’re not stopping there. We believe that the most powerful force behind our brand is our commitment to sustainability, which enables us to consistently offer the unforgettable taste and truly elevated coffee experience that consumers expect from Nespresso worldwide.”
Other key findings
> Top riser: Airbnb’s value increased 21.8 pc, jumping eight places in the table from #54 to #46 despite only entering the ranking last year. The brand’s increase in value is partly due to strong investment in brand and solid financial outlook.
> Automotive and luxury: Automotive brand value rose by 9 pc in 2023, with BMW (#10) entering the top ten for the first time (#10). Porsche (#47), Hyundai (#32) and Ferrari (#70) achieved double-digit rate of growth and were among the top five fastest-growing brands.
> Tesla held its position at #12, but its rate of growth was the slowest among automotive brands with brand value increasing 4.0 pc compared to BMW and Mercedes which grew 10.4 pc and 9.5 pc, respectively.
“Automotive brand top risers have increased scores across Affinity, Trust, Presence and Participation – key drivers of brand value – ultimately increasing their connection with customers,” said Greg Silverman, Global Director of Brand Economics at Interbrand.
Luxury is once again a top-performing sector with brand value rising 6.5 pc. Hermès (#23) and Dior (#76) were two of the biggest luxury brand risers, with 10.2 pc and 8.4 pc growth in brand value, respectively. They join the likes of Prada, Tiffany and Burberry in moving beyond traditional markets and extending their brand presence with new partnerships, product launches and consumer experiences in the metaverse – creating new meaning with new customers.
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