Tencent, a Chinese company, has become the most valuable brand in Asia and the fastest growing brand globally, achieving a brand value of US$54 billion in the 2014 BrandZ Top 100 Most Valuable Global Brands ranking. This success propelled Tencent to the 14th spot globally, surpassing China Mobile.

Source: Millward Brown website.

Deepender Rana, Managing Director of Millward Brown Greater China, emphasized the significance of a market-driven Chinese brand like Tencent taking the lead over state-owned enterprises. He highlighted Tencent’s continuous innovation and its growing role in helping people organize their lives, drawing parallels with successful brands like Google and Facebook. Rana also noted that while China boasts the highest representation from Asia with 11 brands in the Top 100, there is a need for continuous brand-building investment and a more market-oriented approach, especially for large state-owned enterprises. He urged Chinese brands to expand internationally to achieve true global recognition.

In a significant development, Google has surpassed Apple to become the world’s most valuable global brand in 2014, reaching a brand value of US$159 billion, a 40% increase year-on-year. After holding the top position for three consecutive years, Apple experienced a 20% decline in brand value, settling at US$148 billion. Despite remaining a strong performer, Apple’s perceived decline in technology redefinition, coupled with a lack of groundbreaking product launches, contributed to its lower ranking. Meanwhile, IBM retained its position as the world’s leading B2B brand with a brand value of US$108 billion.

Nick Cooper, Managing Director of Millward Brown Optimor, attributed Google’s success to its significant innovation in the past year, citing examples like Google Glass, investments in artificial intelligence, and strategic partnerships that have integrated its Android operating system into various products, including cars. Cooper emphasized that these actions conveyed a powerful message about Google’s mission and coincided with Apple’s slowdown.

David Roth, CEO of The Store, WPP, highlighted the 2014 index as a sign of economic recovery, evidenced by strong valuation recovery and growth across all categories and the entire Top 100. He emphasized the role of strong brands in leading this recovery, noting that 71 brands from the 2008 Top 100 remained on the 2014 list, demonstrating their resilience amidst financial turmoil and digital disruption.

Now in its ninth year, the BrandZ Top 100 Most Valuable Global Brands study, commissioned by WPP and conducted by Millward Brown Optimor, stands out for incorporating the perspectives of potential and existing brand buyers alongside financial data to determine brand value. The combined value of the Top 100 brands has almost doubled since the ranking’s inception in 2006, currently standing at US$2.9 trillion. This figure represents a 49% increase compared to the 2008 valuation, which marked the onset of the banking and currency crisis.

The BrandZ Top 10 Most Valuable Global Brands 2014

Key findings from this year’s research report include:

Share of Life: Successful brands like Google (No. 1), Tencent, Facebook, Twitter, and LinkedIn have become integral parts of people’s lives, evolving from mere tools to platforms that offer new communication forms and assist in organizing various aspects of life. Brands such as Tencent and Google are expanding across categories to capture more mindshare. This trend has also encouraged apparel brands like Nike to become share-of-life brands by offering services like Nike+ that extend beyond their primary function.

Technology brands demonstrated strong performance and commanded the highest total value: Despite comprising less than a fifth of the Top 100, technology companies accounted for nearly a third of the total brand value in the BrandZ Top 100 ranking. Service-based brands thrived, while product-based companies like Samsung, HP, and Sony lagged behind brands like Tencent, Facebook, and Baidu.

Apparel emerged as the fastest-growing category: The top 10 apparel brands experienced a 29% surge in value, reaching nearly US$100 billion, surpassing categories like cars (up 17%) and retail (up 16%). Brands like Uniqlo, Nike, and Adidas recorded double-digit valuation growth.

Strong brands facilitated faster growth: An analysis of the BrandZ rankings as a ‘stock portfolio’ over the past nine years reveals a superior performance compared to broader stock market indices like the S&P500. While the value of companies in the S&P500 index increased by 44.7%, the BrandZ portfolio surged by 81.1%, underscoring the superior value delivery of companies with strong brands to their shareholders.

Western brands rebounded, securing a greater share in both the number and value of brands in the top 100. This resurgence reflects the resilience of established brands, the emergence of new brands, and improved economic conditions. Consequently, the representation of brands from rapidly developing economies declined in 2014. However, China, with 11 brands, maintained its position as the most represented nation.

Chinese brands experienced slower growth and face a pressing need for internationalization: The 11 Chinese brands on the list achieved a combined value of US$280 billion this year. While China’s overall brand value continued to rise, its pace lagged behind the global average. Apart from outperforming technology brands, other industries faced significant fluctuations. In an increasingly globalized world, international expansion has become a crucial priority for Chinese brands. The perception of Chinese brands as innovative and global has begun to take root among overseas consumers, laying the groundwork for their participation in the global market. Chinese brands can leverage innovation to differentiate themselves and utilize the internet to access international markets more rapidly and cost-effectively.

Listed Chinese brands:

The BrandZ Top 100 Most Valuable Global Brands report, rankings, and additional brand insights for key global regions and 13 market sectors are accessible online here. A new suite of interactive smartphone and tablet applications are also available for complimentary download through Apple IOS and all Android devices from www.brandz.com/mobile, or by searching for BrandZ in the respective iTunes or Google Play app stores.