How do you value a brand -- not a company, not a world-renowned CEO, but a brand? Marketing research firm Millward Brown knows, and its recent rankings of international brands puts BMW, Toyota, and Mercedes-Benz at the top of the automotive sector.
Millward Brown starts with quantitative data, looking at how much money brands have made and how much they're likely to make in the future. The firm is careful to strip away distractions related to marketing, product placement, and such to calculate the earnings that can be tied back solely to the brand itself.
Then, the firm looks at things qualitatively, asking consumers to express their feelings about various brands. Do they love it? Hate it? How much? Combine the two, and you've got brand value. (Methodology fans, there's a fuller explanation here.)
Millward Brown just released the data from its 2012 BrandZ Top 100 Most Valuable Global Brands study (PDF). The tip-top of the chart is dominated by a bunch of likely suspects: Apple, IBM, Google, McDonald's, and Microsoft. But a bit further down the line -- around #23 -- we start seeing automakers. Here's a list of the top ten, with overall rankings in parentheses for those brands that landed in the BrandZ Top 100.
1. BMW (23)
2. Toyota (28)
3. Mercedes-Benz (46)
4. Honda (65)
5. Nissan (81)
6. Volkswagen (96)
In its comments, Millward Brown gives some interesting perspective on the auto sector as a whole.
As we know, the strength of auto markets varies wildly from country to country. However, consumer demand in the U.S. has been huge, hitting heights not seen since 2006. That's due in part to the increased availability of high-tech, inexpensive vehicles.
In fact, Millward Brown says that's causing problems for luxury automakers. Conveniences once available only in the cushiest of rides are now available on vehicles that cost less than $20,000. Lexus and its ilk are going to have to engage in some major innovation to differentiate themselves from the mass-market pack.
Two other key factors at play in the auto sector are fuel-efficiency and Generation Y. The increased importance of the former explains how Toyota has been so quick to recover from the recall fiasco of 2010 and from the natural disasters that curtailed production in 2011. Thanks to the company's Prius lineup, when consumers think of fuel-efficient vehicles, they often think first of Toyota.
And as for Generation Y, Millward Brown believes -- as we've mentioned before -- that those young whippersnappers are forcing automakers to think very differently about the vehicles they make. Millennials are more interested in gadgets than gears, so finding effective, cost-efficient ways to turn 18-to-35 year-olds into car buyers will be key going forward.