"Why do I need to spend money on Branding ?" is the retort I hear when explaining the need for branding and its link to the mission and success of the business.
To prove my point I need go no farther than APPLE! Once a broken company on the verge of bankruptcy Apple was the first company in the history of the world to cross the $1 trillion valuation mark - this happened last week when Apple climbed to $207.30 per share.
So, what did branding have to do with Apple's rise and record setting performance - EVERYTHING!
Steve Jobs, on his return to Apple as CEO, wrapped Apple in a very simple mission/branding discipline - to 'focus on simplicity and forward technology in their products'. Breaking from the personal computer Apple ventured into new realms - launch of iPod in 2001, the iPhone in 2007, the iPad in 2010, the Apple Watch in 2015, and introduced big-buck services like Apple Music and Apple Care (which some Wall Street analysts predict will be a $50b business within a year).
Apple stayed committed to their brand, which is currently the most highly valued in the world, to the extent that their products have and do command a premium price, ie. have 'brand equity'. Apple, through effective branding turned consumer' needs into wants and thus could charge more for what was the same or similar products vs. their competitors.
To put Apple's worth (valuation) at over $1T in perspective here are some comparisons:
- At $1T, Apple just falls short of the combined value of the four largest U.S. banks (BofA, Citi, Chase,Wells) at $1.17T.
- Apple's value is greater than the combined valuation of the top 24 auto makers in the world at $964B. Therefore, Apple is more valuable than GM, Benz, Toyota, Ford, VW, and 19 others altogether.
- Apple is worth more than the entire American media industry, including: all of the major news publishers, TV channels, and media companies, including Netflix, AT&T, Disney, Fox, and CBS.
Which entity will be next to join Apple in the one-trillion dollar club? Most likely it will be Amazon, Google, or Microsoft all three of which have valuations north of $750b. Amazon leads with a market value of about $825b.
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