We examine the present in light of the past
so as to better understand the future.
John Maynard Keynes

* With apologies to Karl von Clausewitz

Tata bucks India's brand trend

Brand Finance has just released its Global 500 survey of the world’s most valuable corporate brands. Having a strong and long-standing interest in Tata, I immediately checked to see where its brand was positioned, and was intrigued to see that it has risen from 39th position in 2013 to 34th, with an estimated value of £21.1 billion.

Okay, it is not Apple or Coca-Cola, but that is still a pretty valuable asset. (And it should be added too that calculating brand value is not an exact science; twist any brand valuer’s arm hard enough and he will probably admit that there is a lot of educated guesswork involved. Different brand agencies have been known to give vastly different values for the same brand, depending on the methodology they use.) And there are some very interesting things about the Tata corporate brand that should be highlighted.

This increase has been achieved at a time when the Indian economy has had some well-publicised problems. According to Brand Finance, the brand value of other top-league Indian firms such as State Bank of India, Reliance, Airtel and Indian Oil have slipped, sometimes quite dramatically, down the league table. And, again according to Brand Finance, this is part of a wider trend whereby the brand values of companies from all the BRIC countries have slipped. Brazilian firms, for example, have lost an average of their brand value. Tata’s brand, by contrast, gained nearly 9 per cent.

Why? I think there are two reasons. First, Tata is starting to reap the fruits of the internationalisation strategy put in place by Ratan Tata and his colleagues over a decade ago. Tata now earns the majority of its income outside of India, and is thus less affected by local economic fluctuations. Only a handful of other BRIC firms have been able to do this. The great majority are still very closely tied to their home economy.

The other reason is rooted in the nature and history of the group itself, and in particular its strong sense of connection with the societies and countries in which it operates. ‘What comes from the people goes back to the people, many times over’, is a Tata mantra. That strong sense of mission is one of the things that makes Tata distinctive. And I feel certain, too, that this is one of the reasons why the Tata brand continues to be so valuable. After all, people value the things that they trust.

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Adi Gaskell commented on
Management Consultancy

Pradee commented on
Oh, no, not another book on management!

Laurie commented on
Another one bites the dust - reflecting on my new book on management failures