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TikTok has entered the ranking of the top 100 most valuable global brands for the first time, as people spend more time online during the pandemic browsing lighthearted, entertaining user-generated content, according to a new report.
Technology giants dominated the list once again, with Amazon AMZN, -0.46% maintaining the top spot as its brand value surged to $415 billion, a 32% jump from 2019, according to the 2020 BrandZ Top 100 Most Valuable Global Brands ranking compiled by Kantar and WPP WPP, +2.41%.
The e-commerce giant’s stock has climbed 45% this year, as the COVID-19 crisis has accelerated consumer trends toward online shopping. Apple AAPL, +2.30% held on to the second spot after its brand value climbed 14% to $352 billion, and Microsoft MSFT, +1.07% regained third, ahead of Google GOOG, +2.57% and Visa VISA, -0.23%.
TikTok — the popular short-video-sharing social network, owned by Chinese entertainment company ByteDance — was the highest new entry this year, taking the no. 79 spot as it grew its brand value to $16.9 billion.
“TikTok’s achievement indicates the power of a brand that quickly grew from popularity in China into a worldwide phenomenon, and it reflects the growth of mobile entertainment,” said Doreen Wang, global head of BrandZ.
The app, which lets people post 15-second videos, has more than tripled its U.S. employees in the past 12 months, according to a recent report by Reuters. However, TikTok’s Chinese ownership has attracted scrutiny from U.S. regulators and lawmakers, who have questioned the safety of the personal data the app handles, Reuters said.
On Monday, the Indian government banned dozens of Chinese mobile apps, including TikTok and Tencent-owned WeChat, citing cybersecurity concerns after a border clash between troops from the two countries left 20 Indian soldiers dead this month, according to The Wall Street Journal.
Asian brands accounted for a quarter of the top 100 list, including 17 Chinese brands, such as tech giants Alibaba BABA, -0.32% and Tencent 700, +2.59%.
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TikTok joins UnitedHealthcare UNH, +1.00% (no. 86, $15.8bn), Bank of China BACHY, +0.32% (no. 97, $13.7bn), Lancôme, which is owned by L’Oréal LRLCY, +0.25% (no. 98, $$13.6bn), and Pepsi PEP, +1.66% (no. 99, $13.3bn) as one of five new entrants in this year’s list.
Innovation and creativity have proven to be a key driver for growth in this year’s Top 100, and a way to prevent decline. “Companies like Amazon, Apple and Google — the tech giants that keep on innovating — successfully combine both to continue being relevant to consumers’ lives and making it easier for them to choose a brand,” Wang said.
The total brand value of the Top 100 global brands reached $5 trillion, equivalent to the annual gross domestic product of Japan. It has increased by 245% since 2006, when the total brand value first reached $1 trillion.
Before the pandemic, BrandZ had predicted that total brand value of the Top 100 brands was set to increase by 9%.
The ranking, which is now in its 15th year, combines analyzed market data from Bloomberg with extensive consumer insights from over 3.8 million consumers around the world, covering over 17,500+ different brands in 51 markets. This year, it used valuations data incorporating stock price performance from April 2020 to reflect the impact of COVID-19.
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Tech brands continued to dominate the top of the ranking, representing over a third of brand value in the top 100 and growing overall by 10%. Apple AAPL, +2.30% maintained its position as the second most valuable global brand (+14%, $352.2bn) while Microsoft MSFT, +1.07% regained the no. 3 position (+30%, $326.5bn) ahead of Google GOOG, +2.57% (+5%, $323.6bn) at no. 4, driven by growth of its cloud-enabled workplace ecosystem, allowing people to maintain ‘business as usual’ during the lockdown.
David Roth, chairman of BrandZ, said that strong brands are in a much better place than they were in the global economic crisis of 2008-9 and had shown that consistent investment in marketing has helped them navigate the coronavirus crisis. “We see a significant improvement in brand equity now compared with 10 years ago because businesses understand the importance of investing in brand-building and are stronger and more resilient as a result.”
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Brands have also found new and creative ways to engage with consumers, build trust and create a level of intimacy, particularly in health and wellness.
Athleisure brand Lululemon LULU, +1.66% (+40%, $9.7bn) was one of the fastest risers, having shifted its focus from yoga-inspired wear to work-appropriate clothing, as well as offering online classes for people at home.
