Britain's Biggest Business Brands

Published in Investing on 23 May 2012

These six British blue-chip firms own some of the world's most valued brands.

In Romeo and Juliet, William Shakespeare wrote:

"What's in a name? That which we call a rose

By any other name would smell as sweet."

In other words, Shakespeare said that names don't matter; what matters is the essential nature of something or someone.

Shakespeare was wrong

Unfortunately, when it comes to corporate brands, the brilliant Bard of Avon is absolutely wrong. Indeed, some company names and brands are fantastically valuable, as the latest 2012 BrandZ Top 100 Most Valuable Global Brands report demonstrates.

In the seventh of its yearly brand reports, Millward Brown estimated that the world's top 100 brands are worth a total of $2.4 trillion (£1.5 trillion). That's a two-thirds (66%) increase in brand value between 2006 and 2012.

Furthermore, during these six years, a portfolio consisting of these highly valued brands would have beaten the S&P 500 -- the main US market index -- by 103%. In short, big brands often produce bumper returns for their owners, even during the worst recession since the 1930s.

The world's 10 biggest brands

For the record, here are the top 10 brands in the BrandZ list:

BrandValue ($bn)Change on 2011 (%)
Apple18319
IBM11615
Google108-3
McDonald's9517
Microsoft77-2
Coca-Cola741
Marlboro749
AT&T69-1
Verizon4915
China Mobile47-18

As you can see, this is a list dominated by technology firms, with Apple, IBM, Google and Microsoft taking four of the top five slots.

The king of fast food, McDonald's, takes fourth spot, while syrupy drink Coca-Cola and cigarette maker Marlboro take sixth and seventh places. The remaining three slots are all taken by telecoms firms: AT&T, Verizon and China Mobile.

The UK's six biggest brands

Now let's take a look at some of Britain's biggest brand names. These six FTSE 100 firms are the only British entries in the Brandz top 100 table:

BrandWorld rankValue ($bn)Change on 2011 (%)
Vodafone (LSE: VOD)1243-1
HSBC (LSE: HSBA)3119-14
Tesco (LSE: TSCO)3618-18
Royal Dutch Shell (LSE: RDSB)391817
BP (LSE: BP)7710-17
Standard Chartered (LSE: STAN)7910-16

Taking top slot for the UK is telecoms Goliath Vodafone in 12th place (Vodafone also owns 45% of Verizon, which was ninth overall). Next up is mega-bank HSBC (31st), followed by the UK's biggest supermarket, Tesco, in 36th place.

In fourth and fifth places are oil leviathans Royal Dutch Shell (39th) and BP (77th), but note the 17% drop in BP's brand value from 2011 to 2012, against Shell's 17% rise. Emerging-market bank Standard Chartered takes the sixth and final British slot, a mere 79th overall in the world.

Big, beautiful brands

For the record, I view all of these companies as British heroes ideal for investors. Indeed, I'd be happy to own shares in all of the British top five, as each is a dividend monster in its own right.

Furthermore, one of these six UK brands is also a firm favourite of multi-billionaire Warren Buffett, the world's most acclaimed investor. In fact, the Oracle of Omaha has bought more than 5% of this brilliant British brand, spending a couple of billion pounds in the process. To find out more about this national treasure, download our free report today: The UK Business That Buffett Is Buying.

Finally, to build wealth from blue-chip shares, go where the growth is. To do this, download a free copy of Top Sectors For 2012, The Motley Fool's new guide for intelligent investors. It picks out three sexy sectors to help boost your investment returns, so grab your copy now!

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> Cliff does not own any of the shares mentioned in this article. The Motley Fool owns shares of Google and Tesco.

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Comments

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apprenticeDRL 23 May 2012 , 10:16am

This brands list seems a bit US Centric. If you went into the highstreet in UK, Europe or even India how many people would have heard of Verizon or China mobile?.

IBM a bigger brand than google? I suspect that IBM is really only known in business circles these days.

AT&T I would bet that more people in Europe, maybe rest of world have heard of Tesco or HSBC or even Walmart than AT&T. I would bet the farm that more global citizens had heard of Nestle or Heinz than AT&T.

Not sure how they drive this list but just my thoughts.

apprenticeDRL 23 May 2012 , 10:16am

Sorry that should be derive this list

CunningCliff 23 May 2012 , 2:28pm

Hi apprenticeDRL,

Given that the US account for over a fifth (22%) of world GDP, it's no surprise that this list is dominated by American brands. Also, the US is #1 at marketing and thus promotes its brands best on the international scale.

In short, "we're all Americans now!" ;0)

All the best,

Cliff

tru2me 23 May 2012 , 3:21pm

In short, "we're all Americans now!" ;0)

Very true Cliff.

"Doing the right thing", is an American term although many UK citizens do not know this.
Maybe because the term has been used widely in UK by politicians.
Things have been and are slipping across the pond more often than you might first assume.
Insidious springs to mind.

apprenticeDRL 23 May 2012 , 5:16pm

Cliff

I take your point, I was just a bit suprised at the top brands in the survey

jaizan 23 May 2012 , 10:23pm

I question the whole analysis.

Within any given segment, I would value a brand by asking the question:
If you take a commodity product, make a few minor adjustments to meet the brand values and ask how much the price can be increased by sticking the branded badge on the front ?
Or will buyers buy your product and shun competitors, because of the name on the product?

notsloc 24 May 2012 , 3:48pm

Cliff, Brand value must be related to global awareness, so while the US has 22% of global GDP it only has 5% of the global population, so will only contribute about 14% to global awareness. China will be a little less.

So to have such country specific brands as AT&T, Verizon and China Mobile in the top 10 is nonsense, and ApprenticeDRL's post is valid.

The list is evenmore discredited as it beggars belief that global brands, with high global market shares, such as Ford, Volkswagen and Toyota, do not appear.

And how come I don't get this email until a day after the other posters?

dukindiva 24 May 2012 , 4:57pm

The US economy has 22% of global GDP, but I am willing to bet that US firms are looking at the remaining 78% and planning to do something about it :-)

the top brands are the hardest to imitate as they are being constantly invested in by their owners.

mivvy 24 May 2012 , 7:36pm

Cliff

There's a slight error in the article. You state that Vodafone owns 45% of Verizon but what they actually own is 45% of Verizon Wireless with Verizon itself owning the other 55%. I'm sure that Vodafone wished that they owned 45% of Verizon!!

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