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4/23/2007
06:58 PM
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Google Surpasses Microsoft As Most Powerful Brand

The search engine also posted the highest momentum with the shortest-term growth rate, along with Apple, Louis Vuitton, Starbucks, Porsche, eBay, Chanel, Hermes, and Rolex.

Google is the most powerful brand in the world, according to research and consulting firm Millward Brown.

Millward Brown Optimor, the company's brand consulting arm, Monday released its Brandz Top 100 Most Powerful Brands survey in conjunction with the Financial Times, which published the complete report.

Google took the top spot with a brand value of $66.4 billion, followed by General Electric ($61.9 billion), Microsoft ($54.9 billion), Coca-Cola ($44.1 billion), China Mobile ($41.2 billion), Marlboro/Altria ($39.2 billion), Wal-Mart ($36.9 billion), Citigroup ($33.7 billion), IBM ($33.6 billion), and Toyota ($33.4 billion).

The value Millward Brown Optimor assigns to corporate brands is based on a company's "intangible earnings," a metric derived from public financial data supplied by Bloomberg Datamonitor.

Millward Brown Optimor determines the portion of intangible earnings attributable to the company's most loyal users. It then projects this value forward based on "research-based loyalty data from the Brandz database," market valuations, the brand's risk profile, and its potential for growth.

"Intangible assets are things like brands, patents, human resources, and distribution networks," said Ove Haxthausen, a director at Millward Brown Optimor in New York. "Things that give you a competitive advantage."

This is in contrast to tangible assets like plants and facilities that show up on corporate balance sheets. Google's current stock market capitalization is $149.2 billion, compared with Microsoft's $281.8 billion.

Google gained 77% in terms of brand value, rising to #1 from #7 in the 2006 Brandz study. Microsoft lost 11% of its brand value from last year's report, falling to #3 from #1.

The brands with the highest momentum -- short-term growth rate -- were Google, Apple, Louis Vuitton, Starbucks, Porsche, eBay, Chanel, Hermes, and Rolex, according to the report.

Beyond Google's ascension, the 2007 Brandz report notes several emerging trends.

One such trend is the increasing affluence of consumers abroad. But succeeding in countries like Brazil, Russia, India, and China means offering "products or services that are relevant to the local consumers," the report states, pointing to specific fast food, apparel, and luxury brands as examples.

The fast food category outperformed all other categories in terms of total growth. Faced with criticism for contributing to unhealthy eating habits, "the fast food industry has responded to the decline in consumer demand by changing its product offerings," the report observes.

Another trend the report observes is the increasing impact of social responsibility on brand value. "Delivering on the promise of corporate social responsibility helped boost the value of major brands including BP ($5.9 billion), Shell ($4.7 billion), and Toyota ($33.4 billion)," the report states.

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