Tesla recorded growth of 32%, becoming the fastest-growing automotive brand in the world and reaching a value of USD 5.9 billion, while Toyota retains the title of leader of the ranking and is the most valuable automotive brand in the world in an industry that is struggling with declining margins, new concepts of ownership and competition from new technologies

Tesla is the fastest-growing automotive brand, which recorded growth of 32% to the level of USD 5.9 billion in the BrandZ™ Top 100 Most Valuable Global Brands ranking for 2017, announced today by WPP and Kantar Millward Brown. This rapid growth reflects the brand's successful positioning as innovative, yet at the same time elegant and luxurious, offering the performance of an advanced combustion engine, but without the guilt associated with polluting the environment.

Toyota's triumph

Toyota remains the most valuable automotive brand in the world. The company recorded a 3% decline in its brand value to USD 28.7 billion, and higher sales were negatively offset by difficult challenges on the currency market as well as increased investments and rising labor costs.

BMW (USD 24.6 billion) and Mercedes-Benz (USD 23.5 billion) complete the top three, while Ford moved up one place to position No. 4, reaching a brand value of USD 13.1 billion.

Because the past year brought sales successes, the total value of the Top 10 brands in the automotive sector remained at USD 139.2 billion, although a decline of 3% was recorded here last year. This year, innovation turned out to be an important theme for many brands, as brands make efforts to create solutions for many current challenges, including new forms of ownership and the increasingly common connectivity of vehicles to the Internet.

The level of the sector's results shows that although sales grew in the most important markets (both China and the USA recorded record sales), the discounts necessary to remain competitive caused a decline in the margins of the leading brands on the market. In turn, luxury brands avoided margin cuts and now account for 52% of the value in the top ten of the automotive ranking, whereas in 2006, when the BrandZ Top 100 ranking debuted, it was 36%.

The BrandZ ranking is the largest and most authoritative platform reflecting the dynamics of brands around the world – the ranking includes brands that effectively fit into the lifestyles of today's consumers. BrandZ is based on a unique brand value study that combines conclusions from interviews conducted with more than 3 million consumers around the world and an analysis of the financial and business results of individual companies (based on Bloomberg and Kantar Worldpanel data).

Popular brands are gaining greater popularity

Mercedes-Benz, which grew by 4%, was the best in the top seven, but in the lower part of the Top 10 ranking there were also significant changes.

In addition to Tesla's success, mention should be made of the large increases of two brands: Land Rover (No. 9) – an increase of 17% to USD 5.5 billion, and Porsche (No. 10) – an increase of 16% to USD 5.1 billion. The former took advantage of growing demand for SUV-type cars, while the latter built popularity in key Asian markets: Taiwan, Singapore, Malaysia, Thailand and the Philippines.

“The automotive industry will soon face rapid changes, and many brands are already taking action to prepare for the use of new sales channels, changing forms of ownership and the arrival of more autonomous cars connected to the Internet,” commented Peter Walshe, Global BrandZ Strategy Director at Kantar Millward Brown. “Financial pressure to achieve current sales results combined with outlays for investments and preparations for the future are factors that, on the one hand, build pressure among brands long present on the market and, on the other, create space for newcomers such as Tesla. Strong brands will not only help automotive concerns increase their current revenues, but also encourage consumer loyalty, because the cars of these brands will change radically in the future.”
The 10 most valuable automotive brands in the world in the BrandZ™ ranking for 2017

Many automotive brands have already invested significant funds in autonomous cars and have considerable technical achievements, especially in the area of cars steered without the use of hands and feet. Relevant functions are already available today, including technology that keeps the car within its current lane.

Technology that is changing the automotive industry

Automotive companies are also making great progress in improving networked vehicle control. Both BMW and Nissan have taken action to build in digital assistance technology based on Microsoft's Connected Vehicle Platform. Toyota purchased licenses from Microsoft for the patents necessary to create its Azure cloud technology.

Many car manufacturers are intensively working on integration with technology ecosystems. For example, BMW and Ford are cooperating with Amazon. Thanks to Amazon's personal assistant Alexa, drivers of some BMW models can carry out some engine checks using voice commands, even without leaving home. Ford plans to introduce into its Sync system the ability to respond to voice commands within Amazon's Echo system.

The most important automotive brands are also experimenting with new solutions in the area of mobility – this applies to situations when consumers need access to a car, but do not necessarily want to own it. Mercedes has already introduced a network modeled on the idea of Airbnb, within which one can rent a Mercedes. Audi is testing a rental program called Audi on Demand. Participants in the program choose an Audi model suitable for a given occasion – shopping, dinner in town or simply a drive – and a concierge delivers and later picks up the appropriate car.

Life is for sharing?

Ford bought a ride-sharing service in the USA called Chariot. In Amsterdam, in turn, companies offering car sharing pick up passengers in Tesla cars.

All these activities are preparations for the fundamental battle, that is, the arrival of truly autonomous cars. In this case, the competition has expanded significantly, because companies such as Alphabet, Apple and Samsung are making intensive investments in this area. Alphabet changed the name of its autonomous car company to Waymo and is conducting extensive testing of its vehicles in Phoenix (Arizona), Apple obtained permission to test autonomous cars in California, and Samsung received approval to test its vehicles on public roads in South Korea.
However, the introduction of autonomous cars to the mainstream market will depend to a large extent not only on legal changes, but also on the extent to which leading technology brands will be able to ensure safety within the software controlling these cars.

The most important results of this year's global BrandZ Top 100 Most Valuable Global Brands ranking:

Amazon belongs to the top five most valuable brands in the world. The brand moved up to 4th place in the Top 100, rising by 41% and reaching a value of USD 139.3 billion. This retail giant continues to focus on developing its own technology ecosystem, capable of meeting consumers' diverse needs, and moreover introduces new services based on artificial intelligence, including grocery delivery and a “personal assistant” application called Alexa.

Google, Apple and Microsoft maintain the top three positions, increasing the value of their brands over the past year by 7% to USD 245.6 billion, 3% to USD 234.7 billion and 18% to USD 143.2 billion, respectively, while Facebook, occupying 5th place, recorded growth of 27% to USD 129.8 billion.

Strong brands continue to outperform the competition. If we compare this year's ranking with key benchmarks for the last 12 years, we can state that the value of the BrandZ Top 100 portfolio is 50% more than the value of the brands in the S&P 500, reaching a value 3.5 times greater than the MSCI All Country World Index.

The technology ecosystems of consumer-focused brands make it difficult to imagine life without some brands. Consumers can carry out many activities – from online shopping to watching television – thanks to one brand, but across different devices. By providing consumers with convenience, the strongest brands minimize the risk of consumers switching brands.

New brands are becoming increasingly global, which enables them to grow quickly. Thanks to new technologies, enterprises can offer their products and services around the world from the first day of operation. In this way, a new group of entrepreneurs is emerging, disregarding the geographic or sectoral boundaries that traditionally limited the pace and scale of growth.

Traditional non-technology brands are introducing technological innovations to increase their appeal to consumers. The fastest-growing company in the ranking, Adidas, introduced 3D printing in footwear production, while the traditional fast-food brand Domino’s Pizza offers customers the ability to track an order in real time.

The BrandZ Top 100 ranking is becoming younger. The average age of a brand is now 67 years, whereas in 2006 the average age was 84 years. This is the result of the emergence of newer technology brands and the development of brands in China.

Brands that clearly communicate how they will make their customers' lives easier, for example Huawei and Toyota, are recording on average three times more dynamic growth over the last 12 years (growth in the top tercile of the ranking was 170%, and in the bottom tercile – 57%).

Effective communication gives brands an advantage. Brands with the best communication (top tercile of the ranking), including McDonald’s and L’Oréal Paris, increased their value by 196%, while brands from the bottom tercile recorded growth of 47% over the same period. These brands owe such good results to effectively strengthening their distinctiveness among the competition.

 

About Kantar Millward Brown

Kantar Millward Brown is a leading research agency specializing in advertising effectiveness research, strategic communication, traditional and digital media, and brand value research. The company helps its clients build strong brands through comprehensive solutions based on qualitative and quantitative research. Kantar Millward Brown operates in more than 55 countries and belongs to the Kantar group of companies of WPP, one of the world's leading companies dealing with data, knowledge and consulting. More information at www.millwardbrown.com.

About WPP

WPP is the world's largest provider of communication services, with revenue of USD 74 billion and income of more than USD 19 billion. Through its operating companies, the Group offers a comprehensive range of advertising and marketing services, including areas such as media and advertising investment management; data investment management; public relations; brands and their identity; healthcare communication; digital marketing, e-commerce and in-store marketing, and specialist communication. WPP employs more than 205,000 people (including associates and employees of acquired companies) in more than 3,000 offices in 112 countries around the world. More information at www.wpp.com.

For the sixth time in a row, WPP received the title of Holding Company of the Year at the annual Cannes Lions International Festival of Creativity in 2016. WPP was also recognized for the fifth time as the Most Effective Holding Company in the Effie Effectiveness Index for 2016. In 2017, for the third time in a row, WPP was recognized by Warc 100 as the World’s Top Holding Company.