While food manufacturing is an industry where product brand names are hugely important, treating a company name as a significant branding asset is often unappreciated. Enhancing product brands typically receives a level of attention that leads to disregard of many other aspects of the business. An approach mandating that nothing is more important than focusing on product brands neglects brand building that may be equally important to the company’s success. After all, it is the value of the brand represented by the name of the company itself that builds relationships and underscores integrity. Neglecting the value of the company’s name as a hugely important brand by itself overlooks building relationships. This is particularly costly in a world where competition for domestic as well as global business has grown increasingly fierce. Indeed, it is in just this sort of environment that the ability of companies to establish their names as respected brands may have value far greater than is frequently perceived. Establishing what a company’s name stands for, in the way of reliability, of service fulfillment, of quality of product, is hugely important.
The great value of company name branding has been impressively defined in the annual studies published by the Financial Times that identify the leading global brands. Using data compiled by the BrandZ unit of Millward Brown Optimor the telling part of the latest report has to do with the global oil industry. At one time, the value of corporate oil brands reflected only their retail business. But this radically changed as it was realized how that approach seriously undervalues brands. The major part of oil company business and brand value occurs in their exploration, trading and wholesale operations. This prompted the Financial Times to say, “The brand element is at least as important, if not more, in the business-to-business environment than it is on the retail side.”
In an explanation especially relevant to the food industry, the study’s evaluation of brand value cites how governments react to brands. “A government,” it says, “will carefully weigh an oil company’s reputation for having the latest technology and promoting sustainability when granting drilling rights.” In a similar point that harkens to how business is done by food companies, the study declares that the correlation between oil company size and brand value is not a straight line. This is especially the case when it is recognized how brands influence investors as well as regulators and governments.
In addition to underscoring the value of brands in business-to-business transactions, this year’s study of brand value reveals two significant shifts. One is the way technology has become a factor that surpasses marketing skills in creating brand value. Thus, Google, with a brand value of $114 billion, is the most valuable name on the list. Seven of the ten most valuable brands reflect the power of technology. The only food-related business in the top ten is McDonald’s. Rivaling technology as an influence is the shift to brands originating in emerging markets. The study lists 13 of the top 100 brands as coming from emerging markets. Seven of those 13 are from China.
Huge shifts also are noted from year-to-year in brand value, regardless of where a company is headquartered or where it originated. Thus, a few technology companies suffered sharp falls in brand value as their products were outshone by rivals. BP, the oil industry brand leader at the year’s start, has undoubtedly seen its value drop.
Of great importance for global brand leaders is how they are recovering more quickly from global recession than the overall economy. While food companies experienced much less impact from the economic downturn than most companies in other industries, the performance of food leaders with respected brand names in building business serves as a reminder of the great value of a good corporate name. There is hardly a more effective foundation for building business in food.