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Cult Brands Make for More Valuable Brands

The annual ranking of the world’s most valuable brands from Interbrand and Business Week has been released. For 2004, the big branding trend identified in the published report will not come as a surprise to followers of marketing blogs.

Identified Trend: Create Cult Brands
Brands that create cult-like devotion from customers by fostering community and forging unique relationships where companies allow customers to feel as if they own the brand are rewarded with greater sales and even greater salience.

The Business Week article is a worthy read, so click here to download. You can also download the 2004 Global Brands Scoreboard which lists the top 100 global brands.

If you are time-starved, you can read the following highlights lifted from directly from the Business Week article:

“This seismic shift in clout from companies to their customers is creating opportunities, especially for younger brands that grew up with the Internet and have become adept at building user communities. Meanwhile, some traditional brands, such as Coca-Cola and Microsoft, are struggling to retain their mammoth leads in a market where consumers increasingly resist what they see as bland ubiquity and a surfeit of power.”

“There have always been cult brands, mostly smaller labels unknown to the masses. But these days, building cults or at least strong communities, is a widespread strategy. No wonder companies that are able to instill a sense of ownership in near-fanatical customers showed the biggest gains in our fourth annual ranking of the 100 most valuable global brands.”

“The brands that have managed to build cultlike followings have done so by being, well, cultlike, at least in some aspects. They are self-consciously different from rivals. They’re bound by a set of clearly defined and rigorously enforced values. And they fulfill a range of needs for their members — er, customers. The fastest-growing ones often project an aura, an attractive group identity.”

“Such exchanges (specific reference to Jian Shu’s blogging about his IKEA experiences) underline a key aspect of brand communities in the modern age: They evolve in ways that the head office often can’t control. Newly empowered consumers can appropriate and manipulate the brand in whatever way they want.”

“Some companies are using mass customization to bind their customers ever more tightly to their brands. The efforts extend beyond the individualized Web pages that characterize Web sites like Amazon.com and eBay. It means allowing customers to set up fan sites on the Web or personalize items.”

“In contrast, some old-line brands seem to be coasting on sheer size rather than an ability to forge a unique relationship with customers. Even brands that have enjoyed decades of success and have instant recognition with consumers can lose some sparkle. Over the past year heavyweights like Microsoft, Coca-Cola, and Walt Disney saw their brand values erode.”

Brands that recorded double-digit increases in brand value for 2004 include:
#21 | Samsung (+16%)
#31 | Nike (+13%)
#35 | Canon (+12%)
#37 | Goldman Sachs (+13%)
#43 | Apple (+24%)
#61 | Yahoo (+17%)
#66 | Amazon (+22%)
#68 | Caterpillar (+13%)
#71 | Reuters (+12%)
#76 | Motorola (+12%)
#89 | Moet & Chandon (+13%)
#90 | Nissan (+14%)
#98 | Starbucks (+12%)

Brands that recorded double-digit decreases in brand value for 2004 include:
#08 | Nokia (-18%)
#19 | Ford (-15%)
#46 | Nintendo (-21%)
#53 | Kodak (-33%)
#82 | AOL (-18%)
#85 | Levi’s (-10%)
#94 | Boeing (-10%)

Further Learning:
Interbrand’s 2004 Best Global Brands Press Release (7/22/04)
Interbrand’s FAQ on their “2004 Best Global Brands” report
Brand Autopsy post on worthwhile white paper reading on Cult Brands
Church of the Customer post #1 and post #2 on why “Control is Futile” for big companies refusing to act “small”

4 Comments

  • Best Global Brands by ValueInterbrand and Business Week have released their 2004 rankings of the world’s most valuable brands. Brand Autopsy has a link to the Business Week article (which otherwise requires a subscription to read) and a good summary post.

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  • _ryanSaghir says:

    Building the Cult BrandBusiness Week recently had an article on Cult Brands (found via a excellent post at Brand Autopsy where you can find key excerpts from the article) that spawned some interesting thoughts regarding building a Cult Brand. Branding today has evolved…

  • _ryanSaghir says:

    Building the Cult BrandBusiness Week recently had an article on Cult Brands (found via a excellent post at Brand Autopsy where you can find key excerpts from the article) that spawned some interesting thoughts regarding building a Cult Brand. Branding today has evolved…