Apple Inc. (NASDAQ:AAPL) is now the world’s most valuable brand, according to Interbrand, which released its updated list this morning. This is the fourteenth consecutive year the firm has been compiling the list, and this is the first time that The Coca-Cola Company (NYSE:KO) doesn’t top the list.
Apple’s brand estimated at $98.3 billion
Interbrand now estimates that Apple’s brand is worth about $98.316 billion, which is a 28 percent increase over its valuation last year. The firm uses a proprietary method for determining how much each major global brand is worth. One of the big contributors to the method is the strength of the brand, which the firm describes as “the ability of the brand to create loyalty and, therefore, to keep generating demand and profit into the future.”
Clearly this year’s record high launch of the iPhone 5S and 5C handsets show that Apple can keep generating demand profit. The firm lists one of the main reasons Apple Inc. (NASDAQ:AAPL) soared to the top of the list this year as being its “legions of adoring fans, as evidenced by the record-breaking launch of the iPhone 5C / 5S.”
Apple’s financial situation versus its brand
Interbrand notes that in 2012, Apple hit a major milestone by becoming the world’s most valuable company. However, this valuation has not been sustained. The company has since taken back the top spot for market capitalization, but there have been times over the last year when it started to lag back behind Exxon Mobil Corporation (NYSE:XOM). Those were the times when Apple’s shares have been valued far below the $705 per share high they hit last September.
But in spite of the ups and downs shares of Apple Inc. (NASDAQ:AAPL) have seen over the last year, the company’s brand has remained stable, according to Interbrand. “… on a product and popularity basis, Apple continues to whet appetites for more,” the firm wrote.
Of course part of what makes a brand like Apple so popular is the company’s reputation. Interbrand points to the decision to bring manufacturing of the Mac Pro back to the U.S. as being a big positive for Apple Inc. (NASDAQ:AAPL)’s reputation, saying that the company “has taken criticism over Foxconn worker conditions in China to heart.” And yet, Apple still does plenty of business with Foxconn, although this is something that really can’t change overnight.
The research firm also notes that Apple’s is the only tech company with an entire product line which exceeds Energy Star specifications in the U.S. It also has the biggest privately owned solar facility in the U.S. and is taking other steps toward greening up its operations under Lisa Jackson, former chief of the Environmental Protection Agency.
On the negative side, Apple Inc. (NASDAQ:AAPL) was found guilty of fixing the prices of e-books and accused by lawmakers in more than one country of dodging taxes. Needless to say though, consumers don’t seem to care about these things.
Where will Apple go next?
The firm appears to like all of the changes Apple Inc. (NASDAQ:AAPL) is making right now, particularly the refresh of iOS 7 under Jony Ive. It says what really sets Apple’s brand apart is how the company moves forward “with the customer at the nexus of everything it does.”
Interbrand directly addresses those who question whether Apple Inc. (NASDAQ:AAPL) still has the innovative ability it was once known for. The firm says “the real breakthrough” could end up being a “smaller, mightier incarnation of the Mac Pro.” The firm suggests Apple should redesign the traditional PC tower to make a cylindrical tower which is built around a thermal core, is about an eight the volume of the old model, and offers twice as much computing power.
It’s interesting that they see Apple’s “next big thing” as being a redesigned PC since like the PC market is so rapidly disappearing. But the firm also notes that Apple will have to slow down the momentum of its biggest competitor, Samsung Electronics Co., Ltd. (LON:BC94) (KRX:005930), and capture the Chinese mobile market.