Amazon: The world’s most innovative tech company
From Alexa Skills Blueprints to AWS to Prime, Larry Dignan and Bill Detwiler make the case for Amazon as the most innovative tech company on the planet.
Amazon has made history, breaking the so far unattainable $200 billion brand value mark, according to the latest Brand Finance Global 500 report. This is the third consecutive year Amazon was named the world’s most valuable brand by Brand Finance, an independent brand valuation consultancy. The online marketplace giant experienced 18% growth from nearly $189 billion in 2019, to $220.8 billon.
Amazon’s brand value is over $60 billion more than Google’s brand value of $159.7 billion and $80 billion more than Apple’s at $140.5 billion, the Brand Finance report said.
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Also notable is that Nokia, up 1% to $9.9 billion, is the only Finnish contender among the world’s 500 most valuable brands, climbing up to 182nd position from 188th last year, according to Brand Finance. Over the last year, Nokia has enjoyed a boost in brand value serving the world’s top communications service providers, enterprises, and consumers–-as well as deploying cutting-edge 5G technology, the consultancy said.
“Investments are expected to pay off in the coming years, setting Nokia in a prime position to continue competing with peers, in particular, in rolling out 5G networks around the world,” said David Haigh, CEO of Brand Finance, in a statement.
Challenges to Amazon’s brand dominance
The world’s largest online marketplace, Amazon has also branched out into cloud computing, artificial intelligence, consumer electronics, digital streaming, logistics, and is looking to enter other industries, the consultancy said. While the company has a diverse product and service portfolio and continues to invest in fast-growing sectors and innovative technologies, “the majority of Amazon’s revenue still comes from retail, and challenges to the growth of the company’s core operations may result in brand value stagnation in the future,” Brand Finance said.
One example is Nike, which announced in November 2019 it would no longer sell its merchandise on the platform, to develop its own direct sales channels. “Amazon may have to contend with other big brands following Nike’s lead, which would undermine its reputation as the ‘everything store,'” Brand Finance said.
Another potential sticking point is the future of Amazon’s international business, Brand Finance said. “From environmentalist opposition in Europe, to backlash from local retailers in India, to saturation of China’s e-commerce market by Alibaba and its subsidiaries – matching globally the status that Amazon enjoys in the US, may prove difficult,” the firm stated.
“The disrupter of the entire retail ecosystem, the brand that boasts the highest brand value ever, Amazon continues to impress across imperishable consumer truths: Value, convenience, and choice,” said Haigh. “Today, Amazon’s situation seems more than comfortable, but what will the roaring twenties hold in store?”
Retail brands rise in value
Forty-four retail brands are featured in this year’s ranking alongside Amazon, with a combined value of nearly $800 billion, making the sector the third most valuable behind tech and banking. “As the boost from the novelty of tech startups fizzles out, some online retailers have begun to lose brand value, while brick-and-mortar chains, which have learned to integrate tech and successfully adapt to the changing marketplace, are consequently making gains,” Brand Finance said.
eBay’s brand value has continued to erode, falling 9% to $8.2 billion, the firm said. Despite the fact that the number of active buyers has steadily increased over the last year and is now at 183 million, “eBay is failing to maintain relevance in an increasingly monopolized sector,” the consultancy said. However, it is attempting to diversify and introduce new revenue streams through eBay Payments and promoted listings, which might mean the brand fares better in the coming year, Brand Finance said.
Walmart (up 14% to $77.5 billion) has seen its brand value resurge, jumping up three places and entering the top 10 once again, according to the report. “As well as committing to its expansion program in key markets, Walmart has focused on an innovative digital proposition, through a partnership with Microsoft and with the launch of Alphabot–robots that pick and pack online grocery orders at high speeds,” the firm noted.
Hilton Hotels Resorts remains the hospitality sector’s top brand and one of the fastest-growing brands in the ranking overall, improving its brand value 35% to $10.8 billion, according to Brand Finance. Although it still trails Hilton, Marriott has also seen substantial growth over the past year, recording a 20% uptick to $6 billion, the firm said.
ATT is the fastest-falling telecoms brand this year, down 32% to $59.1 billion, according to Brand Finance. Just like its biggest rival Verizon, ATT finds itself outside of the top 10 most valuable brands in the world for the first time in nearly a decade, the consultancy said.
Baidu’s, Uber’s brand value drops
Despite many success stories, there are also clear signs of a slowdown, the consultancy said. The combined value of the Brand Finance Global 500 has increased by less than 2% year on year, and while 244 brands have increased their brand value, another 212 are down, including 95 by 10% or more, Brand Finance said.
For example, Chinese software giant Baidu recorded the largest drop in brand value, down 54% to $8.9 billion, the consultancy said.
Uber’s brand value dropped by one third, down 32% to $15.3 billion, forcing it to share the ride with five fastest-falling brands in the ranking. The company went public this year but with disappointing results, closing its first day of trading with a 7.6% reduction in valuation.
Tesla, Instagram on the rise
In contrast, Tesla is “racing ahead as the fastest-growing brand with a brand value of US $12.4 billion, up 65% on last year’s valuation,” Brand Finance said. “The electric vehicle innovator began sales to customers in further reaches than ever before, including China, Australia, the UK, and several markets in Eastern Europe.”
Instagram secured the second-highest brand value increase this year, up 58% to $26.4 billion, according to Brand Finance.
Following the largest IPO in history, Saudi Aramco is the most valuable new entrant to 2020 ranking, claiming the 24th place globally, with a brand value of $46.8 billion, Brand Finance said.
Ferrari retains its position as the world’s strongest brand with Brand Strength Index (BSI) score of 94.1 out of 100, according to the consultancy.
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