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Thursday, 23 January 2020 00:00 - - {{hitsCtrl.values.hits}}
Defending its position as the world’s most valuable brand for the third consecutive year, Amazon has broken the so far unattainable $ 200 billion brand value mark, according to the latest report by the world’s leading independent brand valuation and strategy consultancy Brand Finance.
Following 18% growth from $ 187.9 billion last year, Amazon’s brand value has now reached $ 220.8 billion, over $ 60 billion more than Google’s and $ 80 billion more than Apple’s.
The world’s largest online marketplace Amazon has also branched out into cloud computing, artificial intelligence, consumer electronics, digital streaming and logistics and is looking to enter other industries. With a diverse product and service portfolio, and thanks to continued investment in fast-growing sectors and innovative technologies, Amazon is not only the leader of today but also primed for tomorrow. 
Nevertheless, the majority of Amazon’s revenue still comes from retail and challenges to the growth of the company’s core operations may result in brand value stagnation in the future.
In November 2019 it was announced that Nike would no longer be selling its merchandise on the platform, to develop its own direct sales channels. Amazon may have to contend with other big brands following Nike’s lead, which would undermine its reputation as the ‘Everything Store’. Another potential sticking point is the future of Amazon’s international business where regulatory and environmentalist opposition in Europe and a backlash from local retailers in India could stifle growth.
Brand bubble bursting?
Despite many success stories, there are also clear signs of a slowdown. The combined value of the Brand Finance Global 500 has increased by less than 2% year-on-year, and while 244 brands have increased their brand value, another 212 are down. Those which once enjoyed long-term success are now in need of adjusting in a world more unpredictable than ever, while many tech brands are suffering after failing to meet the bullish expectations of investors.
Excitement alone cannot carry a brand – something Uber is battling to do as its brand value dropped by one-third, down 32% to $ 15.3 billion. The company went public this year but with disappointing results, closing its first day of trading with a 7.6% reduction in valuation. Uber continues to take hits, including the loss of its licence to operate in London after repeated safety failures. Reminded by investors of the old adage that ‘revenue is vanity, profit is sanity, cash is reality’, the company is trying to get back on track and reorganised its internal structure in Q3 2019, focusing on five segments, with a prioritisation of efficiency, profitability and positive cashflow.
In contrast, one company still very much on the road to success is Tesla, racing ahead as the fastest-growing brand with a brand value of $ 12.4 billion, up 65% on last year’s valuation. The electric vehicle innovator began sales to customers in places farther than ever before, including China, Australia, the UK and several markets in Eastern Europe. The brand appears to be living up to its hype and is growing in value and strength.
Among well-established brands which have now hit turbulence, Boeing declined a significant 29% to $ 22.7 billion. It quickly went from a company of safety first to one laden with a reputation for cover-ups, and its future is now on the line.
Asia
Increasing in brand value by 4% to $ 94.5 billion, Samsung remains the most valuable brand in Asia and the fifth most valuable brand in the Brand Finance Global 500 ranking. The tech giant managed to beat its predicted earnings this year, largely due to the popularity of its 5G phones – as of November 2019, the company owns 54% of the global 5G market. Samsung seems set to continue this trend as it looks to develop cutting-edge technologies in the coming year, including the new foldable Samsung Galaxy Bloom phone and SelfieType invisible virtual keyboard.
Sri Lanka
In 2019, Dialog upstaged many established brands to become the most valuable brand in Sri Lanka. The emergence of technology brands seemed to be emulating the Global 500. The question is whether Dialog will be able to retain its position in 2020 or whether traditional banks will be able to make a move to regain leadership. Sri Lanka’s most valuable brands will be released by Brand Finance Lanka in April 2020.
Brand Finance is the world’s leading independent brand valuation and strategy consultancy, with offices in over 20 countries including Colombo, where it has been operating since 2004 and has built a local team of resource people. Brand Finance bridges the gap between marketing and finance.
