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Business News/ Industry / Infotech/  Microsoft pegged as world’s leading B2B brand, worth $122bn
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Microsoft pegged as world’s leading B2B brand, worth $122bn

Microsoft is followed by IBM at number 2, another tech brand

In the case of Microsoft, the leadership of Satya Nadella has been primarily responsible for the company transforming from a traditional B2B central-control structure to a collaborative culture, more typical of the B2C technology brand leaders. Photo: ReutersPremium
In the case of Microsoft, the leadership of Satya Nadella has been primarily responsible for the company transforming from a traditional B2B central-control structure to a collaborative culture, more typical of the B2C technology brand leaders. Photo: Reuters

New Delhi: Microsoft is the world’s most valuable business-to-business (B2B) brand, its value growing 5% in the last year to $122 billion, according to the first annual BrandZ ranking of the top 20 most valuable B2B brands.

Launched on 8 June by WPP and Millward Brown, in partnership with LinkedIn, BrandZ is an annual study of the views and opinions of consumers who use and buy brands. Millward Brown combines the BrandZ data with financial data to compile the annual brand rankings.

Microsoft is followed by IBM at number 2, another tech brand. The report says that slower growth in China, Brazil and Russia, along with the precipitous drop in oil prices, challenged B2B brands in the two sectors of oil and gas and banking. As a result, oil and gas brands that include ExxonMobil (number 14) and Shell (number 16) declined 20% in brand value; and global banks like HSBC (number 9) and regional bank brands like Wells Fargo (number 3) fell in their brand value by 11% and 12%, respectively.

Only five B2B brands, all in technology, increased in value: Microsoft, SAP, Accenture, Huawei and Intel. At number 11, Huawei, the Chinese telecommunications equipment maker, grew 22% after investing heavily in innovative new technologies such as software-defined networks and cloud solutions that enable business agility. Efforts to raise brand awareness in Europe, including the signing of A-list movie actors and footballer Lionel Messi as brand ambassadors, were also successful.

Accenture (no. 7, +13%) transformed itself from an outsourcing company to an innovative tech brand by embracing emerging digital technologies including cloud, mobile and analytics, and gained market share by enhancing its global delivery network.

SAP (no. 6, +2%) improved customer experience with a hybrid on-premise/cloud offering that supports the full enterprise workflow, when many competitors’ approaches are still siloed.

The performance of the top 20 reflects the challenges faced by the B2B sector over the last year, including financial pressures caused by slowing economies. Issues such as the pace of digitization, the battle to attract talent and the changing B2B audience (46% are now millennials) made it harder to retain customers, differentiate from competitors and engage decision-makers.

The B2B businesses that successfully increased their value in this climate were those that shifted focus and resources from developing products to building their brands and creating a great customer experience.

In particular, the tech category is experiencing some “consumerization" as B2B brands introduce more consumer devices into the workplace and work more collaboratively. IBM, Cisco and SAP have partnered with Apple, for example. These partnerships push more consumer devices into the workplace and enhance consumer devices with more enterprise apps.

In the case of Microsoft, the leadership of Satya Nadella has been primarily responsible for the company transforming from a traditional B2B central-control structure to a collaborative culture, more typical of the B2C technology brand leaders.

The report also points out that over the past 11 years, B2C technology brands have grown 358% in value as compared with a 84% rise for B2B technology brands. Analysis of the BrandZ data shows that people perceive B2B brands as more responsible and better to work for than B2C brands, but less dynamic, innovative and differentiated. This has had an impact on their value.

The top 20 B2B brands of 2016 are worth a combined $682 billion in value to the companies which own them.

The BrandZ top 20 most valuable B2B brands 2016 in full.

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Published: 09 Jun 2016, 05:25 PM IST
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