IBM and TCS narrow the gap in a field dominated this year by American and Indian brands, according to an independent study.
Accenture has retained its position as the world's most valuable IT services brand, despite its brand value dropping 4% to $25.3 billion, according to the latest report by Brand Finance, an independent brand valuation and strategy consultancy.
Brand value is defined by the net economic benefit a brand owner would achieve by licensing its brand in the open market, the consultancy said. Brand strength is the efficacy of a brand's performance on intangible measures relative to its competitors, Brand Finance said.
"The reduction in the Accenture's brand value was driven largely by a drop in its brand strength with doubts surfacing about its future brand resilience in the face of changing market demands," according to the company, which values the world's biggest brands annually.
The ranking of the world's most valuable IT services brands has been expanded to 25 brands for the first time this year, and is dominated by American and Indian brands, which filled eight of the top 10 spots. The only two non-American or Indian brands to make the top 10 leader board are France's Capgemini (brand value up 12% to $6.6 billion) and Japan's NTT Data (brand value up 19% to $5.1 billion), which were also the two fastest-growing IT services brands in the top 10, according to Brand Finance.
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AI, cloud services boost IBM and TCS brand value
IBM's IT services division (brand value up 4% to $21.2 billion) and TCS (brand value up 5% to $13.5 billion) have reduced the gap behind Accenture and have remained the second and third most valuable IT services brands, respectively, according to Brand Finance.
"Both IBM and TCS saw strong brand value growth on the back of increased performance of their artificial intelligence and cloud services, areas that are likely to continue growing strongly in the medium term,'' the report stated. Additionally, "the saturation of Internet of Things services" and the need for strong and trusted computing services to serve, store and analyze devices, as the reason IBM and TCS are gaining momentum. The report said both are "strongly placed to take advantage of the commercial opportunities."
"Accenture remains the world's most valuable IT services brand, but it is likely to be challenged over the long-term by the rise of IBM and TCS, who are quickly growing their cloud and artificial intelligence services,'' said David Haigh, CEO of Brand Finance, in a statement. "Both IBM and TCS are well placed to leverage their existing brand strength in this strategic sector of the future economy."
Accenture and IBM fall in brand strength while TCS remains strong
In addition to measuring overall brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, loyalty, staff satisfaction, and corporate reputation. Alongside revenue forecasts, brand strength is a crucial driver of brand value, according to the consultancy.
According to these criteria, Accenture and IBM both lost brand strength, with their ratings falling from AAA to AAA- to join TCS as the three AAA- rated IT services brands, substantially ahead of the fourth strongest IT service brand, AA+ rated Wipro. Wipro (brand value up 8% to $4.3 billion) maintained strong brand strength with its focus on serving large business customers.
Fujitsu and NTT Data are fastest growing IT services brands
Fujitsu has claimed the title of the world's fastest growing IT services brand, after recording a 29% brand value increase to $3.3 billion, the report said.
NTT Data (brand value up 19% to $5.1 billion) was the fastest growing IT services brand in the top 10, with the Japanese company's brand value growing strongly as a result of increased revenue expectations, according to the consultancy. NTT achieved an increase of over 18% for new orders received and increased operating income by more than 6%.
Capgemini brand strength up to AA+ and value grows 12%
Capgemini was another key brand winner this year, growing both its brand value and brand strength significantly, the report said. The French brand's value and strength both benefited from very strong performance in both North America and Europe, especially with its digital and cloud services division growing revenue by more than 20%.
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