Here Are the 4 Fastest-Growing Global Brands
A little more than a year ago, Starbucks (NASDAQ: SBUX) then-CEO Howard Schultz said the coffee shop's primary goal was to get back on track. He said he believed the chain had a "clear line of sight to returning our U.S. business to historic levels of comp sales growth" of 5% or more.
It's taken over a year, but last quarter, domestic comparable-store sales grew 5%, and Starbucks announced a number of initiatives to optimize its store portfolio, accelerate long-term growth, and increase returns on capital.
While Starbucks' stock hasn't responded in kind, trading basically unchanged from where it was last year, the same can't be said of its "brand value," which has soared 16% over the past 12 months, according to one estimate. Brand consultancy Interbrand's 2017 Top 100 Global Brands survey found that Starbucks' brand value jumped to $8.7 billion this year, enough to raise it from the 64th spot on the list to 60th place, putting it ahead of the likes of Sony, Colgate, and Morgan Stanley.
Interbrand's assessment of brand value looks at the financial performance of the branded products or services, the role the brand plays in purchase decisions, and the brand’s competitive strength.
There were only 16 companies that enjoyed double-digit growth rates in their brand value; Starbucks' gains were the fifth biggest of the group. Let's take a look at the four brands in Interbrand's 18th annual top global brands report that grew even faster.
Adidas: Rank No. 55Increase in brand value: 17%
Footwear maker Adidas (NASDAQOTH: ADDYY) bills itself as "the original sports brand" and has built its growth strategy on the strength of its Superstars and Stan Smiths sneakers. However, with sales of those stalwart shoes slowing -- relatively speaking; they're still huge sellers -- Adidas is looking to other footwear like its UltraBoost to let it successfully take on both Under Armour and Nike. Second-quarter sales soared almost 20% year over year, with sales jumping in China and North America by 28% and 26%, respectively.
Nike might be the dominant footwear brand, with a near-35% share of the market (its brand value ranks 18th on the Interbrand list), but Adidas continues to gain share, nearly doubling its slice of the market to more than 11%.
Adobe: Rank No. 56Increase in brand value: 19%
Document specialist Adobe (NASDAQ: ADBE) has been on a tear for the past year, with its stock rising more than 36%, but the shares pulled back slightly after its latest earnings report due to management's expectation that it would be unable to make its full-year goal of 30% bookings growth for its Adobe Marketing Cloud, its collection of integrated online marketing and web analytics products.
Even so, Adobe expects to see 20% growth, and the only real hiccup is due to the fact that its deals are increasing in size, so they are taking longer to close. As a result, analysts remain bullish on the document company, and it's likely Adobe will continue to see its brand value rise. Between 2016 and 2017, Adobe has risen from 63rd place to 56th, and its value now stands at over $9 billion.
Amazon.com: Rank No. 5Increase in brand value: 29%
E-commerce king Amazon.com (NASDAQ: AMZN) continues its push toward the top of this global brands list with another year of stellar performance, both in its operations and its brand value. Amazon broke into the top 10 back in 2015, and each year has improved its position. It might not be long before it becomes the most valuable global brand.
In the meantime, Amazon continues to focus on using its Prime member loyalty program to improve the value proposition for its customers. And while it has long been light on a bricks-and-mortar strategy, that has changed in recent months with its acquisition of Whole Foods Market and a partnering with physical retailers like Kohl's to sell its products in their stores.
Amazon.com moved from No. 8 last year to fifth place this time as its brand value hit $64.8 billion.
Facebook: Rank No. 8Increase in brand value: 48%
Social networking platform Facebook (NASDAQ: FB) is growing at a scorching pace as its brand value rocketed 48% higher to $48.2 billion, good enough to catapult it into the top 10 position of global brands. Last year, it was 15th after growing 48%.
It's hard to believe that just five years ago, Facebook made its first appearance on this list at 69th place and a brand value of $5.4 billion. That means since 2012, the social networking platform's brand value has been growing at a compounded 54% annual rate each and every year.
As it seeks to expand beyond being simply a part of social media, look for Facebook to make further strides in virtual reality, artificial intelligence, and connectivity. It will be an interesting race to the top among these global brands.
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Rich Duprey has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon, Facebook, Nike, Starbucks, and Under Armour (C Shares). The Motley Fool recommends Adobe Systems. The Motley Fool has a disclosure policy.