Lego overtakes Ferrari as most powerful brand

LONDON (Feb. 20, 2015) — Pull over to the berm, Ferrari. Lego is now the world's most powerful brand.

At least that's the take by London-based Brand Finance, which calls itself “the world's leading brand valuation and strategy consultancy.” The firm's annual Brand Strength Index judges brands on such criteria as familiarity, loyalty, promotion, staff satisfaction and corporate reputation.

Its latest index put the Lego Group ahead of Ferrari Brand S.p.A. According to the firm, Lego “scores highly on a wide variety of measures,” noting it “is a uniquely creative and immersive toy; children love the ability to construct their own worlds that it provides.

“In a tech-saturated world, parents approve of the back-to-basics creativity it encourages and have a lingering nostalgia for the brand long after their own childhoods. The Lego Movie perfectly captured this cross-generational appeal. It was a critical and commercial success, taking nearly $500 million since its release a year ago. It has helped propel Lego from a well-loved, strong brand to the world's most powerful.”

On the other hand, Brand Finance said the Ferrari brand has stalled and is now ninth on its index. “Lego has overtaken Ferrari, last year's most powerful brand. Ferrari remains a very strong brand but its power is slowly diminishing,” the index found. Ferrari “has now gone several years without an F1 title and last season struggled even to mount a challenge.

“The sheen of glory from its 1990s golden era is beginning to wear thin. Meanwhile, the departure of Luca di Montezemolo heralds a slight change in strategy at Ferrari's road car division.”

Mr. Montezemolo is an Italian businessman, former chairman of Ferrari and of Fiat S.p.A. who is now the head of Confindustria and FIEG.

Brand Finance added that Mr. Montezemolo “kept a strict cap on production to maintain the exclusivity of the (Ferrari) brand. Since his departure, Chairman Sergio Marchionne has suggested that this policy will be relaxed to boost revenues.

“Many Ferrari owners and aspiring owners are extremely brand-conscious, making the loss of the ‘world's most powerful brand' accolade — which Ferrari has held for several years — a particularly heavy blow.”

Brand Finance CEO David Haigh said Ferrari “is still in a strong position and its brand value has actually increased 18 percent this year to $4.7 billion. The new strategy to capitalize on the brand will certainly drive short term value but over-exploitation risks lasting damage.”

Bridgestone Corp. was the first tire company to show up on the Brand Finance Global 500 report, coming in at No. 243. Group Michelin was at 271 and Continental A.G. at 405. The list also is sprinkled with a number of auto makers and automotive-related companies.

In other highlights from the Brand Strength Index:

• Apple capped a record-breaking month with the highest brand value in history — $128.3 billion.

• Twitter is the fastest growing brand, with its brand value nearly tripling in a year, increasing from $1.5 billion in early 2014 to $4.4 billion now. Fellow tech giants Baidu and Facebook have also grown strongly, by 161 percent and 146 percent  respectively, according to Brand Finance.

Mr. Haigh said the value of the Apple brand “is huge not just in its own terms but also as a proportion of Apple's record-breaking corporate valuation. It goes to show how valuable brands are as business assets and how important it is to manage them well.”

Brand values for hundreds of the world's top brands from all industries are on Brand Finance's website, where the full Global 500 table can be found along with infographics, further insight and analysis. On Twitter, it can be found by clicking here.