Google Overtakes Apple As The World's Most Valuable Brand In The World

As Google replaced Apple - whose value dropped by $38 billion over the past year as the world's most valuable brand in 2016 after a five-year gap with a value of $109.5 billion, four top Middle East companies, including Emirates and etisalat, secured slots in the "500 most valuable brands" report. While Emirates, the world's largest airline, continues to be most valuable brand in the UAE, Saudi Telecom Co (STC), the kingdom's biggest operator, is the Arab world's most valuable brand, according to consultancy Brand Finance's Global 500.

UAE telecom operator etisalat and Qatar National Bank, the country's largest bank by assets, are the other two Middle East names to find ranking among the Global 500, an annual ranking from the leading valuation and strategy consultancy. The Global 500 ranks brands by monetary value and also calculates the most "powerful" brands, as defined by the companies whose enterprise value is most positively impacted by the strength of their brand.

Andrew Campbell, managing director of Brand Finance Middle East, said Middle Eastern brands continue to make their mark in the Global 500.

"The brand value of the four companies from the region represented in our 2017 ranking grew on average by 23 per cent year-on-year, which reflects the scale of their achievements when it comes to driving brand awareness, recognition and advocacy. We expect more brands from the Middle East to enter our Global 500 in time as oil prices readjust and companies from the region continue to expand into new geographic markets."

STC moved up to 252nd place in the rankings, making it the Middle East's most valuable brand. The company's brand value rose 11 per cent during 2016 to $6.2 billion. The increase was primarily driven by STC "humanising" its marketing campaigns, and reengaging with its stakeholders with a fresh, more personable outlook, Brand Finance Middle East said in a report.

Despite an oil slump, the strengthened US dollar and global economic softening that has impacted consumer appetite for air travel globally, Emirates secured 264th place in the rankings with a brand value of $6.1 billion. The company's Brand Strength Index score even increased from 85 out of 100 in 2016 to 87 out of 100 in 2017, securing it a AAA rating once again.

Etisalat, the bigger of two telecom providers in the UAE, rose to 293rd place, up from 404th place in 2016. The company's brand value increased 45 per cent on last year to $5.5 billion. The rise in value was on the back of growing user numbers, innovation (etisalat was the first Middle Eastern brand to trial 5G) and strong profit results in 2016, the report said.

QNB entered the survey for the first time securing 441th place with a brand value of $3.8 billion. The company's brand value rose 56 per cent year-on-year driven by its continued robust financial performance and its successful international expansion. QNB now operates in more than 30 countries across three continents.

While Google's brand value rose during 2016 by 24 per cent to $109.5 billion from $88.2 billion, Apple's declined from $145.9 billion to $107.1 billion. Google last occupied the position of the world's most valuable brand in 2011. The company remains largely unchallenged in its core search business, which is the mainstay of its advertising income. Advertising revenues were up 20 per cent in 2016 as budgets are increasingly directed online and Google finds more lucrative revenue streams from digital consumers.

"Apple has struggled to maintain its technological advantage. New iterations of the iPhone have delivered diminishing returns and there are signs that the company has reached a saturation point for its brand," said Campbell. The Chinese market, where Apple has enjoyed a dominant market share, is becoming far more competitive with local players entering the market in a meaningful way. Samsung has also been successful in taking market share and financial analysts are projecting declining revenues and margins, he said.

In brand power, Lego (196) has regained its status as the world's most powerful brand, with a brand strength score of 92.7. Much of it success owes to its media licensing deals and partnerships which have driven growth and introduced the likes of Lego Star Wars, Lego Harry Potter and Lego Batman. The Lego Batman Movie will premiere in February with further movies planned for the franchise. This will contribute significantly to Lego's already significant licensing income but, as importantly, the exposure - to both children and adults will reinforce Lego's brand strength for years to come.

Google (1), Nike (28), Ferrari (258) and Visa (57) complete the rest of the top five most powerful brands in the world, with the latter seeing an eight-percentage point gain in brand strength - the most of any company in the top 10.

"A powerful brand can protect a company's value during turbulent market conditions or challenging times for a business. The share price resilience of Samsung and Wells Fargo, after a difficult year, is testimony to how a brand can help a company ride out a storm," said Campbell.