Analytics

California Triumphs in State Brand Battle

Golden Gate Bridge
  • 71 Californian brands feature in America’s top 500, more than any other state
  • Google replaces Apple as California’s (and the world’s) most valuable brand
  • California’s brands have the greatest combined value, 23% of the national total
  • Wells Fargo loses status as the world’s most valuable bank brand to China’s ICBC
  • America’s brands increase in value by 11% despite a turbulent year

Every year, leading valuation and strategy consultancy Brand Finance values the brands of thousands of the world’s biggest companies. A brand’s strength is assessed (based on factors such as marketing investment, familiarity, preference, sustainability and margins) to determine what proportion of a business’s revenue is contributed by the brand. This is projected into perpetuity to determine the brand’s value. America’s 500 most valuable brands, classified by both their industry and their state, are featured in the Brand Finance US 500.

View the full list of America’s 500 most valuable brands here

America’s brands continue to reach new heights. The total value of America’s top 500 brands now exceeds $3 trillion dollars, having increased 11% from $2.82 trillion in 2016 to $3.14 trillion this year. Brand Finance CEO David Haigh comments, “President Trump, an experienced brand builder himself, appears to have fostered a conducive environment for continued brand value growth. However his longer term approach and objectives remain hard to pin down and 2017 could deliver as many if not more shocks than 2016.”

2017 has already delivered one major brand shock. Apple has seen nearly $40 billion wiped off its brand value. Apple has over-exploited the goodwill of its customers by failing to maintain its technological advantage and delivering tweaks to existing products rather than genuine innovation. Brand value has fallen 27% since early 2016 to $107 billion, meaning that for the first time in over five years, California, America and the World have a new most valuable brand.

Six years after it last held the title in 2011, Google is now the world’s most valuable brand with a value of US$109 billion. Google remains largely unchallenged in its core search business, the mainstay of its advertising income. However, as Brand Finance CEO David Haigh observes, “the recent controversy over Google’s placement of customers’ ads alongside undesirable content illustrates that even companies with apparently dominant market positions must be conscious of the risks to their most valuable asset, their brand.”

Wells Fargo remains California and America’s most valuable banking brand. However it has lost its status as the world’s most valuable bank brand. Wells Fargo fell 6% after a turbulent year for the brand. Damage to its reputation has seen its brand significantly underperform this year. The bank has endured a tough year and has been rocked by scandals, lawsuits and resignations. Meanwhile China’s banks are surging in value. China’s economy and businesses across all sectors are growing rapidly, expanding both organically and through a strong demand for foreign acquisitions, creating opportunity for its lenders and financial service providers. Chinese consumers have a relationship with their brands (including their bank brands) that Western brands can only dream of. Information from Brand Finance’s Brand Strength Index reveals far higher levels of trust and loyalty for Chinese bank brands than European or American ones. Economic patriotism plays an important role in reinforcing this. This has helped to propel ICBC, which has a brand value of $47.8 billion, ahead of Wells Fargo. 2017 also sees China’s total bank brand value exceed that of America for the first time.

California remains America’s most valuable state by brand value. Its dominance in tech (the most valuable and fastest growing sector in terms of brand value) has enabled California to pull well ahead of the rest. Of the country’s top 500 brands, 71 hail from the Golden State, with a total value of $725 billion, 23% of the national total.

New York is in second place, but despite have just one less brand in the top 500 than California, New York’s total is significantly lower, at $481 billion. Finance comprises a large share of New York’s total brand value so New York has therefore been disproportionately affected by the stalling values of financial services brands.

The increasing concentration of brand value in tech also helps to explain Washington State’s strong performance. Washington has just 11 brands (16 states have more) yet as the home of tech titans Microsoft and Amazon, Washington ranks 4th with a total brand value of $242 billion.

3rd placed Texas has a much broader base of brand value. Its 48 brands have a total value of $263 billion. Oil & Gas brands are of course well represented, including ExxonMobil and its portfolio of brands, however Texas is home to major brands from a wide range of sectors including AT&T (telecoms), Dell (tech), American Airlines and Whole Foods (retail).

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