This report details some of the findings of The BrandFinance250 Report (BF250), which provides a ranked index of the world's 250 most financially valuable brands. It lists the top global brands across a number of measures, and also uses Brand Finance's Brand Strength Index to identify the strongest brands around the world

1. WARC Report
The World’s Most Valuable Brands
A summary of the BrandFinance250 Report 2007 www.warc.com
Overview
The BrandFinance250 Report (BF250) provides a ranked index of the world’s 250 most financially valuable
brands.
It comes at a time when brands are increasingly recognised as important intangible assets that confer
long-term competitive advantages. This is reflected by recent changes in international accounting
standards, which now permit brands (and other separately identifiable intangible assets) of acquired
companies to be placed on post-acquisition balance sheets.
There are several ways of valuing brands. The BF250 adopts the ‘Royalty Relief’ approach, a method
favoured by tax authorities and courts for its objectivity. Based on publicly available financial information,
it ties back to the commercial reality of brands – specifically, their ability to command a premium in an
arm’s length transaction.
Top global brands
The total value of the 250 most valuable global brands Table 1: the BF250 Top 10 Brands
is US $2,179 trillion. Much of this brand value is not
Value
located in conventional consumer goods sectors, Position Brand ($m)
underlining the point that brands now create significant 1 Coca-Cola 43,146
economic value in all sectors, from utilities to finance. 2 Microsoft 37,074
3 Citibank 35,148
4 Wal-Mart 34,899
The report finds Coca-Cola to be the world’s most
5 IBM 34,074
valuable brand, billing in at over $43bn – nearly twice 6 HSBC 33,495
that of its market rival Pepsi (ranked 19th on nearly 7 GE 31,850
$24bn). 8 Bank of America 31,426
9 Hewlett-Packard 29,445
10 Marlboro 26,990
The IT and technology sector is headed by software
Source: BrandFinance250
giant Microsoft in second place, with IBM and Hewlett-
Packard in fifth and ninth respectively. Of the new internet brands, the highest entry in the list is Google,
ranked in 15th place with a brand value of $24bn. The world’s largest company by market capitalisation,
GE, sees its corporate brand come in at seventh place overall.
Brand contributions to overall enterprise value
In some cases brand value constitutes the bulk of Table 2: Brand Value as % of Enterprise
companies’ total enterprise value (the combined Value
market value of their equity and debt). Nike, for
Value
example, contributes the most, with its brand equating
Position Brand (%)
to 84% of the company's total enterprise value. The 1 Nike 84
second most valuable brand in this category is Prada, 2 Prada 73
representing 73% of the company’s total value. 3 Acer 71
4 Avon 68
5 Bulgari 68
Fashion and cosmetic brands comprise almost all of
6 Chanel 63
the top ten, including Chanel and Estée Lauder, 7 Estée lauder 61
representing 66% and 61% of the parent company’s 8 Quicksilver 60
value respectively. On average, brand values 9 Calvin Klein 58
10 adidas 56
represent 18% of the total enterprise value of the
Source: BrandFinance250
businesses represented within the BF250, confirming
the importance of brands to the overall value and success of the businesses that they symbolise.

2. Most highly rated brands
The report also identifies the world’s very strongest brands, using Brand Finance’s Brand Strength Index,
grading them AAA (extremely strong), AA (very strong) and A (strong) through to CCC (very weak), CC
(extremely weak) and C (failing).
Conceptually similar to company credit ratings, the index provides an understanding of the strength of
each brand and is used to determine appropriate royalty and discount rates in the brand valuation process.
Table 3 shows the 37 ‘extremely strong’ brands awarded Triple-A status. Within that, just 12 achieved the
highest accolade of AAA+, 8 earned AAA status and 17 were identified as AAA–.
Table 3: The BF250s AAA brands
AAA+ brands AAA brands AAA– brands
Coca-Cola Gucci Singapore Airlines
Kellogg’s Apple Disney
McDonald’s Nokia Budweiser
Microsoft Dell Starbucks
Gillette Louis Vuitton Nintendo
Chanel Porsche Siemens
Nike HSBC Shell
Sony Harley-Davidson Moët & Chandon
BMW American Express
Google Wrigley’s
PricewaterhouseCoopers Hennessy
Prada Heineken
Oracle
Jaguar
eBay
Evian
BT
Source: BrandFinance250
Values by region
US brands dominate the BF250 global league table, accounting for 112 of the 250 listed. This represents
45% of the total and confirms the global dominance of US brands and businesses.
Overall, 92 European brands represent 37% of the BF250 global league table. Within that, the UK, with
26 featured brands, emerges above France, which has 24. Germany has 17 – including six global
automotive brands: namely, Mercedes-Benz, BMW, Chrysler, VW, Porsche and Audi.
The remaining 45 brands come from across the globe with a small number from emerging markets. The
report predicts future years to see an increasing number of brands from Brazil, Russia, India and China
and also from other emerging markets.
Further information on the full BrandFinance250 report and its methodology is available from
www.brandfinance.com
Editor: James Aitchison, james.aitchison@warc.com
© Copyright World Advertising Research Center, 2007.
www.warc.com
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