What If Facebook Ranked The Worlds Largest Brands Instead of Interbrand?
So Facebook is 10 years old today!
It’s been a pretty wild and bumpy ride. And tempting as it is to bombard everyone with even more infographics and timelines dating back to 2004 (we can count on Mashable for all that), I thought I’d do something more useful instead… (This is over 2,000 words, you might want to get a cup of tea and a biscuit….)
Top 100 Global Brands
Every year for the last 14 years, Interbrand has published its rankings of the top 100 brands in the world. The brands themselves take these rankings very seriously with C-suite execs anxiously awaiting the new report released every September. CMO’s often pay so much attention to their placing on the list that they use it as a benchmark to measure the relative success of their efforts, based upon their previous years ranking. Executives often go on to plan their corporate strategies for the following year, mindful of what they think these rankings are telling them.
“Your brand is what people say about you when you’re not in the room.” Jeff Bezos, Founder of Amazon
The difficulty in ranking companies this way though, is that calculating the value of brand equity is a very complicated process. It’s still a bit of a beast that even the best consulting companies haven’t managed to master. The research company Millward Brown also run a ranking report of the worlds top 100 brands called BrandZ, and this is where things get interesting…
2013 was the year that Apple became the largest brand in the world and they knocked Coke off the number one spot. A position they held since the report was first published in 2000. Interbrand valued Apple at just over $98.3bn. Millward Brown (the smaller company but who claim to have more real consumer data), claimed that the brand equity of Apple should be valued at a staggering $185bn.
You can see the report for yourself here, but this creates a problem for marketers. In order to do our jobs properly we need brands to trust the numbers we give them ~ and here we have two of the most credible marketing organisations in the world, who can’t even agree on the value of the world’s largest company to within $86bn! [See also Mark Ritson’s post].
We could argue that they should just calculate value of a brand by its’ share price multiplied by the volume of shares in circulation, but that wouldn’t be as much fun would it?
“Your brand isn’t what YOU say it is, it’s what THEY say it is”. Marty Neumeier
On it’s most basic level, a brand is essentially a story or an experience that exists in someone’s mind when they think of that brand. It is therefore something very complicated to measure accurately and must involve all manner of tangible and in-tangible values such as life-time value of a customer, brand preference, advocacy, influence, propensity to recommend etc. etc… Once you look at the full picture and the difficulty that lies in measuring some of these things accurately, it’s not hard to see why marketers are producing such wildly different results.
So What If We Could Make This Simpler?
The world has changed a lot over the last decade since we all discovered Facebook. Many brands have made it their main communications platform, even replacing their websites. Skittles, keen to keep control of their community on their on webpage, couldn’t hold back the tide for long and they soon found that they had 14x more traffic to their Facebook page than they had to their website. Amazon were seeing fans spend twice as much as non-fans. The social audiences weren’t just sharing pictures of cats, they were delivering real brand and shareholder value.
So… WAIT! What if we could just look at the size of an audience that was talking about a brand, and rank its’ relative success in a given period according to that? Ooooooh… don’t we already have something like that?!?!? Perhaps a metric who’s very name implies what it is…
PTAT ~ People Talking About This
And so just for fun, I wondered what would happen if you took the top 100 brands in the world, and re-ranked them according to what people are actually saying about them on Facebook?
There are obviously all kinds of obvious holes in such a simple exercise, but since brands make up such a large part of the Facebook conversation (and drive the revenue of the platform itself), it seems as good a place to start as any. Once I scraped all the data, I soon realized that I might be onto something… 99 of the top 100 brands were “active” on Facebook ~ and in many cases, Facebook was their primary conversation channel. (FYI ~ Morgan Stanley is the only top 100 brand that doesn’t have a Facebook, an omission that deserves a whole blog post of its own…)
Definition of “PTAT”
Introduced on Facebook brand pages in October 2011, the “People Talking About This” (PTAT) metric is simply the number of unique users who have created a “story” about a brand in a 7 day period. The unique part here is especially important. For those of you unsure what that means, a “story” involves any kind of brand interaction such as a:
- “Like” a page
- Post on the page wall
- “Like” a post
- Comment on a post
- Share a post
- Answer a question
- RSVP to a page’s event
- Mention the page in a post
- Tag the page in a photo
- Check in at a place
- Share a check-in deal
- “Like” a check-in deal
- Write a recommendation
- Claim an offer
The obvious difficulty that the social marketers among you will notice here, is that paid media also drives these interactions and can artificially inflate the figures. A high PTAT score might not necessarily mean that a brand has a particularly loyal and engaged audience, it might just mean that they spent a lot of money on Facebook media. I suspect the brand that came out top on my report are guilty of this, but more of that later…
“PTAT is a lot like democracy. It looks like the worst kind of metric but in many cases, it’s the best one we’ve got”. Jamie Mulligan, Adobe Consulting (borrowing some sentiment from Winston Churchill).
And so with no better idea in my head, I spontaneously pulled all the data off the Facebook pages of the world’s top 100 brands to see how they stacked up. And what better time to do this than on early on Monday 3rd February, one day before Facebook’s 10th birthday and the day after the super bowl – the worlds largest annual branded and “most social” event?
The Results…
What becomes VERY interesting is that if you really were to start by looking at the top 25 brands ~ and measure them based upon what “they” (the audience / fan base) say it is and not what “you” (the brand) say it is, then 18 of Interbrand’s “Top Brands” don’t even feature in the Top 25 most talked about brands. This throws up all kinds of questions and speculations, but it also starts a good debate.
Have a look at the top 100 brands ranked according to Facebook’s PTAT score and you’ll find that in many cases, the Interbrand rankings have literally been turned upside down. (I put arrows on the far right to show the biggest movers and shakers between both rankings).
Johnnie Walker ~ The Worlds Largest Social Brand?
Johnnie Walker (ranked 82nd on the Interbrand rankings) surprised me the most, by clearly taking the number 1 ranking and by quite a margin. They have more than double the number of people talking about them than Budweiser and Facebook combined. The curious thing here though, is doesn’t take long to see that perhaps they are not as social as first impressions may suggest. Their numbers are impressive but when I looked at the actual posts on their page, their most recent post (published 15 hours earlier), had only 15 “likes”. The next one had 48 “likes”. Etc.. Interestingly, they are pretty ropey on Twitter. A quick Twitter search only showed me JohnnieWalkerUS and weirdly their website links to NextStep, which only has 87 followers from 128 tweets??? Owners Diagio are maybe not such a “social business” after all then??? But they really could be if they wanted to…
There is clearly a strong media planning strategy at play here, with a land grab for attention on Facebook, but who am I to criticise that approach if they are building the social foundations for something special? I just hope for their sake that their fans live in countries where they are actually able to buy Johnnie Walker! If 2014 is going to anything in social media, it will be the year that Facebook concretes is position as another paid channel – not the free (cheap and easy) social network that many people have been pretending it was.
Social @ Scale
1 person sharing something cool with their friends reaches up to 140 people. EdgeRank aside, if those people share that’s a potential reach of 19,600. When they share it becomes 2.7m. And so it goes on. No wonder brands have been throwing so much money at social media over the last 10 years. The problem is that many brands now own huge Facebook fan pages, yet they often have no idea what to do with them, or what they are actually worth (if anything).
Here are a 6 other things I noticed when I compared the Interbrand rankings to my new social scorings:
- 29 of the top 100 brands moved more than 50 places in the rankings.
- Coke (with their 5,000 strong marketing team) are the only brand who’s position hardly changes (dropped 1 place).
- Morgan Stanley are the only brand with no Facebook presence at all. They have Twitter and Linked In – but with only 844 I don’t think they are really channeling their social efforts elsewhere.
- Budweiser are clearly performing incredibly well according to this weeks PTAT rating, but it’s possible much of this is due to their cute puppy ad in last nights super bowl.
- Many of these global brands didn’t have a global Facebook strategy. It was super hard to find their real official page, and many of them had fragmented local and region pages, with no cohesive brand strategy to join them together.
- You can probably fit everyone who is talking about Goldman Sachs on Facebook into my front room!
Facebook as a BIG Opportunity for Smaller Brands
This is one of my favourite quotes. It sounds playful and offers props to the start-up wishing to take on the industry leader ~ but serious things are at stake here. Some of these brands may not around in a few years time.
Let me give you an example… Panasonic seems to be one of the most under-performing brands socially (only 264,673 fans on it’s company page with a paltry 0.55% of them engaged). But, if Panasonic were to adopt a BIG social strategy – they could actually start to take on Samsung (easily one of the biggest social brands in the world). Samsung take social media so seriously that they have 2 of the top 10 largest Twitter brand accounts.
Panasonic will never compete with Samsung’s global brand budget, but the table stakes are much lower on Facebook. If Panasonic wanted to beat Samsung, this would be a good place to start. If Panasonic really engaged their audience with some powerful stories (shouldn’t be difficult since they are a long-time tier-1 Olympic sponsor), then social media gives them the scale to take on Samsung in a way that other traditional media channels wouldn’t permit. Social media allows people to share emotion ~ something that a brand like Panasonic are already good at. They just need to focus their efforts on the right platforms, to the right audiences, and do it at scale.
“’If it ain’t broke don’t fix it’ doesn’t apply anymore. If it ain’t broke, it’s obsolete”. Bill Gates
At the moment, Panasonic are just focusing their budgets on the wrong channels in my opinion. I don’t work with Panasonic so this is purely speculation (I didn’t mean to pick on them specifically), but TV ads and Olympic sponsorship isn’t going to protect anyone’s market share for the next 10 years. Apple TV will be out soon. Amazon are probably going to give away tablets in the near future when you subscribe to Amazon Prime. And we probably haven’t even heard of the brand who will end up being the most disruptive in this sector over the next decade…
A quick look at the evolution of the Interbrand ranking emphasizes how quickly the brand landscape changes…
And so it goes on. My PTAT ranking points towards so many stories and scenarios, that I only wanted to run this exercise to start a good conversation about what we really value within a company. (As with all such debates, whiskey and cheese should naturally be involved…)
The Facebook Revolution is Just Getting Started
Facebook is custom-designed for feisty start-up’s, disruptive brands, ideas and technologies to reach people at scale. Even though Facebook is 10 years old today, I think we are just at the beginning of this revolution. I understand that many of the B2B companies propping up the bottom of this list may think that Facebook isn’t for them (“it’s not where we do our ‘core business’ etc”), but there is a real danger in dismissing a platform with 1.4 billion people on it.
“Established in 1910 used to be an asset. These days it feels like a liability”. Seth Godin
B2C and B2B brands alike should be asking themselves, “What would our business look like if we were a genuinely social business?” (The answer to this question by the way, is not deciding what your Facebook strategy should be. That’s just one TINY part of it). For many heritage brands, this requires a totally different way of looking at things. Many organisations understandably are not comfortable with such introspection, but if they want to make sure that a small contender doesn’t come out of nowhere and steal their lunch, they need to think and act in a revolutionary way…. and isn’t real revolution ripping it up and starting all over again?
My point here is that (on it’s own) I don’t think the traditional method of measuring brand value is enough anymore. Brand owners need to take a step back and look at the bigger picture. PTAT certainly isn’t the answer. But for now it may part of it. If brands want to still appear on Interbrand’s rankings in another 10 years, they NEED to respect and invest in their communities for the long term, and be wary of short-term initiatives that give short-term gains to protect share-holder value.
New business requires new metrics???
Continue the discussion on Twitter @ JeremyWaite…
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A quick note about the numbers
There will always be someone who jumps on me for a post like this, stating a number that they don’t agree with, but the point of this whole post, while rooted in simple data, is not to compare and contrast who has how many fans or followers. And it’s certainly not intended to poke fun at Interbrand, who I have incredible amounts of respect for. And while PTAT is a sketchy metric for many reasons (one of which is the paid media element that we saw with Johnny Walker), it does raise the point that perhaps we should include some kind of audience value into these figures - especially since the world has changed so much since Facebook came along. PTAT should really be one metric tracked alongside more substantial figures such as ROI (linked to sales) or NPS (based upon brand preference or customer satisfaction) for example. PTAT is also a bit of a shape-shifter and can be quite devious. It changes every 7 days and world events, celebrities, weather, media plans and the like will all keep these figures constantly in flux. It would be cool to produce the PTAT ranking as an interactive infographic, so that we can see how it changes…
Some of the brands on my list have several pages across multiple territories – Kia is a good example. They are a great brand with many pages. But for this exercise I just ranked them on their biggest page. Strangely enough, when I first ran a test on this data back in October, Kia ranked number 1, just in front of Samsung and AVON. The correct and accurate method here would be to collate all of their audiences (across multiple pages) together, in collaboration with the brands themselves – in order to get their true global PTAT value. Then I’m sure these rankings would change again! Also, brands like Adobe have a smallish company page (194k fans) but most of their fans talk on a different page ~ in this case Photoshop’s Facebook page where they have over 5m fans. Danone doesn’t have an official global page at all, but their Egyptian team have taken it upon themselves to build out their page themselves. Nice work! Santander and HSBC are similar – no real global page to speak of but their student pages have sizable (if slightly neglected) audiences.