Top Brands Staying Strong in Downturn

According to Millward Brown’s Top 100 Most Valuable Global Brands of 2009 Report, the top 100 global brands have increased in value by 2% to $2 Trillion over the past year. Despite the global financial downturn, the top brands seem to be immune to the economic turmoil, if you trust Millward Brown’s analysis. Some top brands seem to be excelling in the downturn like Apple and Amazon, while others have tumbled like Disney and Starbucks.

One of the biggest surprises is Apple’s success despite the economic environment. Despite smaller wallets, consumers are still managing to pay for relatively expensive iPods and iPhones which sometimes require expensive AT&T data plans. This supports Millward Brown’s analysis that the top brands are striving. This may be because consumers are looking for the most value for their money. They may sacrifice going to Starbucks for a month and make their coffee at home so that they can afford a new iPhone.

According to the report:

“Customers are not holding their breath during this economic volatility. They are adjusting their coping strategies, while remaining determined to purchase brands that contribute to the pleasure, quality, purpose, and security of their lives.”

One of the biggest questions companies want to know, is whether the recession will cause a lasting change in the way consumers buy. One noticable change is the avoidance of conspicuous consumption as people try not to appear insensitive or greedy. Luxury brands still grew 10% in value, although this can be largely accounted for by growth in demand in China.

“Consumers are not in the mood for greed. And greed is not required for success. Once we are on the other side of the economic slowdown, consumer spending will pick up. But perhaps slowly, as people internalize the lessons of our recent boom and bust history. They will want quality, intelligently created, well-designed products. But they may not want one in every color.”

The study suggests that even when money is tight, consumers will still spend on the strongest brands. Consumers know what they can expect from strong brands and are still willing to pay premiums for this assurance. The exception are brands that are perceived as unnecessary luxuries like a trip to Disneyland or a 4 dollar coffee.

Microsoft’s Gates/Seinfeld Went Viral and ‘I’m a PC’ Ads Didn’t

According to Visible Measures, which charts online video viewing trends and has measured the videos associated with Microsoft’s $300 million ad campaign, the Seinfeld/Gates ads are squashing the “I’m a PC” ads by a margin of 4.3 million viral video views. Both ads had about equal video placements (about 75 each).

Visible Measures points out that while the Seinfeld/Gates clips came out two weeks earlier than the “I’m a PC” ads, Seinfeld/Gates drew twice as many viewers their first week in market than the PC ads did.

After two weeks in market, Visible Measures says, “Seinfeld/Gates was still collecting more than 700,000 views per day, while the ‘I’m a PC’ clips had tapered off to less than 50,000 views per day.”

Why might this be?

Microsoft sparked a dialogue in the Seinfeld ad that isn’t there in PC ads.

“So much viral video is basically word of mouth. And when you build in question into the creative, it gives people something to talk about,” said Matt Cutler, VP-marketing and analytics at Visible Measures Corp.