Chaebol Ahead of Korea in Global Reputation
By Kim Tong-hyung
Staff Reporter
Samsung and Hyundai, South Korea's twin corporate towers, continue to enjoy rising global reputations. Too bad the country just can't keep up with them.
Samsung Electronics, the world's largest electronics maker, became the first Korean company to crack into the top-20 on Business Week and Interbrand's annual ranking of the "Best Global Brands," according to the list released Friday.
Despite its brand value falling 1 percent from last year to an estimated $17.5 billion, Samsung Electronics' 19th place finish was two spots higher than 2008.
Hyundai Motor, Korea's biggest carmaker, was placed 69th, three places higher than it was last year, despite having lost 5 percent of its brand value, which is now estimated to be worth around $4.6 billion, from last year.
"Samsung's drop in its brand value is related to the company's worsened profitability in its semiconductors, liquid-crystal display (LCD) and other components businesses. However, the positive acceptance of its new products such as light-emitting diode (LED) backlight televisions and touch-screen mobile phones has been a plus," said an official from Interbrand's Korean office.
"The company's aggressive marketing efforts to create new markets in televisions and mobile phones were impressive, considering that it came against the backdrop of the global economic downturn," the official added.
Samsung, the world's leading maker of flat-screen televisions, and trailing Nokia as the No. 2 handset provider, has looked convincing in discarding its own tagline as a "poor man's Sony."
And Hyundai, now the world's No. 4 carmaker, is happy to see more people pronouncing its name right, as the company claimed in a Super Bowl commercial last year.
But while the Korean corporate giants are managing to reinvent themselves as cooler companies with better technologies, the country itself as a brand is increasingly coming off as old and crusty.
Korea finished 33rd among the 50 nations listed on the Anholt-GMI "Nation Brands Index" announced last year, clearly a disappointment for the world's 12th largest economy.
The report was based on a poll of about 10,000 consumers worldwide on the perception of cultural, political and business appeal of the surveyed countries, aiming to yield a clear measurement of national brand power. Since reaching 25th on the GMI list in 2005, Korea is continuing to witness its reputation slip.
A more recent survey by the Geneva-based World Economic Forum suggests that the lower consumer opinion on "Brand Korea" might not be too harsh.
The WEF named Korea as the 19th most competitive nation in the world, dropping the country six spots from the 2008 standings. The country's flaky financial services and rigid labor market were pinpointed as the main culprits for the drop.
"Samsung and Hyundai are becoming premium global brands, but the images of companies don't always extend to the image of the countries they are based in. It could be said that the government has done a poor job of connecting with the leading domestic companies and using their reputation to improve the image of the country," said a researcher from the Hyundai Research Institute.
"When assessing the brand value of countries, a variety of factors, such as the government, culture, tourism, companies and human assets, are considered. But aside from drumming up the 'Dynamic Korea' slogan, the country has been lacking a detailed approach in managing its brand value."
This is the ninth-consecutive year that Business Week and Interbrand, a London-based brand consultancy, teamed up to publish the ranking of the top 100 global brands by value.
American Internet heavyweights Google and Amazon, and Spanish clothing brand Zara were among this year's top gainers, while Coca-Cola topped the list for nine straight years, with its brand value estimated at around $68.7 billion. The iconic soft drink giant is followed by IBM, Microsoft, GE and Nokia to round out the top five.
The overall value of the top 100 brands on the Business Week-Interbrand list fell by 4.6 percent from last year, the first annual decline since the list debuted in 1999, showing the effects of the global economic turmoil.
Samsung's brand value was ranked the second highest among consumer electronics makers after Nokia. Sony, its Japanese rival, was ranked 29th as its brand value tumbled 12 percent to $11.9 billion.