Tata slips from top 100 global brands list

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The Tata-Mistry boardroom battle has cost salt-to-software conglomerate Tata group its position among the top 100 global brands.

According to the latest Brand Finance Global 500 report, Tata group’s position has slipped to 103 from last year’s 82. It, however, continues to be one of the most valuable brands from India. In the past, The Tata group has been the only Indian brand that has found a place in the top 100 global brands of Brand Finance.

On October 24, 2016, Cyrus Mistry was ousted as the chairman of the group and a boardroom battle ensued between his and Ratan Tata’s camps. It seems to be the reason its brand value has fallen from $13.11 billion from $13.68 billion earlier.

The 2017 ranking also shows that other Indian brands have all managed to improve their positions. For instance, Airtel, at 242 in 2016, climbed up to 190 in 2017. LIC improved its position to 222 from 283 in 2016. Infosys climbed 50 positions to reach 251.

Other than the Tata group, two other brands that saw their valuations erode are State Bank of India and Larsen & Toubro.

Globally, Google dethroned Apple to become the most valuable global brand. Google’s brand value rose 24 per cent during 2016 (from $88.2 billion to $109.4 billion) whilst Apple’s declined from $145.9 billion to $107.1 billion. The company remains largely unchallenged in its core search business, the mainstay of its advertising income. Ad revenues were up 20 per cent in 2016 as budgets are increasingly directed online and Google finds more innovative ways to monetise users, said Brand Finance.

David Haigh, chief executive officer, Brand Finance, said, “Apple has struggled to maintain its tec

hnological advantage, with new iterations of the iPhone delivering diminishing returns, while the Chinese market is now crowded with local competitors. Apple has been living on borrowed time for several years by exploiting its accumulated brand equity. This underlines one of the many benefits of a strong brand, but Apple has finally taken it too far.”

 

Meanwhile Amazon managed to hold on to its position at the third spot. Amazon’s 53 per cent brand value growth meant it nearly secured the top spot for itself this year. The firm is growing strongly as it continues to both reshape the retail market and to capture an ever larger share of it. Amazon Fresh, its grocery service, is still relatively limited in scale but this year began operating overseas for the first time, serving Central and East London initially. Amazon has stated it will create 100,000 jobs in the US over the next 18 months. Such confidence suggests that Amazon may well see a new brand at the top of the Brand Finance Global 500 in 2018, said the report.

 

Facebook though continues to climb the ranks following 82 per cent brand value growth, but has been outdone by China’s biggest tech brands. Alibaba, WeChat and Tencent have grown by 94 per cent, 103 per cent and 124 per cent respectively.

 

Every year, valuation and strategy consultancy Brand Finance values the brands of thousands of the world’s biggest companies.

 

Brands are first evaluated to determine their power/strength (based on factors such as marketing investment, familiarity, loyalty, staff satisfaction and corporate reputation). Brand strength is used to determine what proportion of a business’s revenue is contributed by the brand, which is projected into perpetuity to determine the brand’s value. The results of this analysis are ranked, with the world’s 500 most valuable brands featured in the Brand Finance Global 500.

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