##davis Brand Capital today released the 2014 Davis Brand Capital #25 ranking, which evaluates overall brand performance. It is the only annual listing of companies that demonstrate comprehensive, balanced approaches to managing brand and related intangible assets, providing an indicator of total business strength and effectiveness.
The sixth-annual Davis Brand Capital 25 evaluates companies’ abilities to successfully manage brand value, competitive performance, innovation strength, company culture and social impact. The ranking reveals the comparative strength and breadth of each company’s total brand management.
Davis Brand Capital 25 companies consistently outperform public market indices. For 2014, a hypothetical stock portfolio consisting of Davis Brand Capital 25 companies would have returned 15% year-to-date in 2014[i], beating the Dow by #7% and the S&P 500 by #3%. With technology companies representing the top companies on the list, the Davis Brand Capital 25 closely tracked NASDAQ performance, exceeding it by 0.76%.
“The big story in 2014 is the concentration of capital, and that includes brand, trademarks, patents and other intangible forms of capital,” said Patrick T. Davis, founder and chief executive officer of Davis Brand Capital. “While there have often been shifts among the leaders on the ranking during the past six years, the strongest corporate brand owners and managers at the very top are only getting stronger.”
The same four technology leaders have dominated the top four spots on the ranking since 2011. This illustrates the deep understanding these companies have for successfully managing brand, providing meaningful utility for their customers and driving innovation to help shape tomorrow. It also suggests a profound concentration of capital – including financial, intellectual and talent – in one industry category. The combined market capitalization of all the technology leaders on the list tops $2.1 trillion.
IBM (IBM) has declined slightly over time, falling to #4 after holding the top spot in 2009 and 2010. Still, its “Smarter” campaign highlighting its “big data” leadership and related products and services demonstrates its consistently outstanding brand management. Microsoft regained its 3 rank from IBM; with new executive leadership, the impressive Xbox One, and a formidable move into “productive” tablets, it will be a company to watch closely in 2015.
##samsung (005930) fell two spots to #11. While it beat 1 Apple to market with its smart watch, the innovation was ultimately a disappointment. As Apple and others enter the “phablet” space and wearable technologies become more mainstream, it will be interesting to see how these two tech giants battle it out in the year ahead.
The cola cold wars are heating up with the release of Coke Life and Pepsi True. But while Coca-Cola Company (KO) poured in at the 7 spot, PepsiCo (PEP) has not made the list since its 25 ranking in 2012. This speaks to Coca-Cola’s best-in-class brand and comprehensive portfolio management, especially given the controversy over sugary drinks and recent weakness in the broader category. The company’s Fairlife milk portfolio extension holds promise for connecting with broader health trends. If the company can succeed with a premium milk product, it may open the door to other seemingly disparate extension opportunities to offset declines in its core business.
Automotive made a strong showing in 2014. #bmw (BMW) ranked #6, moving up from its #12 spot in 2013. #toyota (TM) jumped seven spots to land at #9. #volkswagen Group (VOW) raised six spots to #17. BMW’s i3 and Volkswagen’s XL1 both demonstrated tremendous innovation strength, offering a glimpse of the future for green technology. And Toyota continued its upward momentum after stumbling in 2010 following high-profile product recalls.
Weakness in Europe put pressure on two other automotive leaders. #daimler (DAI) maintains a solid position – largely due to its Mercedes-Benz nameplate – but weakness in the European market hurt the competitive performance of its heavy truck industry. The company fell four spots to #14. Ford Motor Company (F) dropped off the top-25 list this year after holding the #19 spot in 2013. Its big bet on Europe and impressive “global platform” strategy hurt its competitive strength short term. But the new Mustang is a game-changer for American sports cars, and the upcoming aluminum-bodied F-150 pickup is nothing short of revolutionary. Expect big things from the brand in 2015.
##at&t (T) leads the mobile carrier category, despite dropping five spots to #16 this year. #verizon, on the other hand, gained momentum and reappeared on the ranking at #23 after falling off of the list in 2013. Increased competition in the burgeoning no-contract category suggests an even more intense rivalry between these category leaders in 2015. With AT&T dropping and Verizon climbing, a network battle worth watching may be coming.
Three banks appear on this year’s list. J.P. Morgan (JPM) leads the way at 12, improving its position from 14 last year, followed by #citi (C) at #18 and #hsbc (HSBC) at 19. Citi (C) showed the most improvement in the category, rising four spots from #22 last year.
ExxonMobil (XOM) experienced the largest decline in the ranking, dropping nine spots to #24. Falling oil prices, negative consumer perceptions of “big oil,” and an increased focus on renewables in the public discourse likely played a role. However, the company’s “Be an Engineer” initiative is noteworthy for its cultural relevance, superb creative execution and potential to build brand strength moving forward.
Many major consumer brands are notably absent from the list. Companies like Nike (NKE), Facebook (FB), McDonald’s (MCD), Unilever (UN) and others clearly excel at traditional brand management for marketing purposes. “Brand is no longer just about the outward story a company wants to share. It now incorporates social responsibility, talent recruitment and intellectual property. Our ranking recognize the leaders across all these areas, not just marketing strength,” said Davis.
The 2014 Davis Brand Capital 25 ranking is based on the compilation and proprietary analysis of publicly available data from industry-leading annual performance rankings. Each of the five key areas of brand is given equal importance to achieve an integrated, balanced evaluation.
2014 Davis Brand Capital 25
- Apple (NASDAQ: AAPL)
- Google (NASDAQ:GOOG)
- Microsoft (NASDAQ: MSFT)
- IBM (NYSE: IBM)
- GE (NYSE: GE)
- BMW (XETRA: BMW)
- Coca-Cola (NYSE: KO)
- Procter & Gamble (NYSE: PG)
- Toyota (NYSE: TM)
- Johnson & Johnson (NYSE: JNJ)
- Samsung (KRX: 005930)
- J.P. Morgan (NYSE: JPM)
- Disney (NYSE: DIS)
- Daimler (XETRA: DAI)
- Intel (NASDAQ: INTC)
- AT&T (NYSE: T)
- Volkswagen (XETRA: VOW)
- Citi (NYSE: C)
- HSBC (NYSE: HSBC)
- LVMH (EN: MC)
- Hewlett-Packard (NASDAQ: HPQ)
- Cisco (NASDAQ: CSCO)
- Verizon (NASDAQ: VZ)
- Exxon Mobil (NYSE: XOM)
- Nestle (SIX: NESN)
[i] YTD period represents January 2, 2014 to December 4, 2014