Toy Maker Lego Displaces Ferrari As World's Most Powerful Brand

While Apple continues to be the most valuable company in the world, Lego - the family-run Danish toy company - has emerged as the most powerful brand, according to a Brand Finance study, overtaking Ferrari which occupied the top spot in last year's survey.

In a world obsessed, and perhaps overburdened, with technology, it was the back-to-the-basics creativity that Lego encourages which got parents' approval across the globe. The fact that the brand has been around since 1932 and has seen several generations take to its products, the nostalgia for the brand from the mature section of the society also went in Lego's favour. Another critical factor that helped Lego grow from a well-loved company to the world's most powerful brand was the success of The Lego Movie, which has raked in $500 million since its release about a year ago. Lego's core strength is its acceptance by both genders. In the early part of 2014, Lego unseated Mattel to become the world's largest toy company by market value.

Ferrari, which was rated the most powerful brand across the globe in 2013 and 2014, fell to ninth spot but still remains the only automotive brand in the top ten in the category. Despite the steep fall, Ferrari remains a strong brand and its value actually increased 18% over last year. That said, there were quite a few reasons for the dismal placement of Ferrari.

Ferrari has been struggling since the past few years in Formula One, and it couldn't even be a strong challenger in the last season. Its fall in the F1 circus post the Schumacher-era has affected the company greatly. The other factor that played against the Italian icon was the departure of Luca di Montezemolo (the flamboyant ex-chairman of Ferrari), and the strategic alterations made to the company's road-car division. The fact that Montezemolo kept a strict cap on production ensured that Ferrari always maintained its exclusivity and image in the supercar space. Existing and aspiring Ferrari owners are extremely brand conscious and the current chairman, Sergio Marchionne's, efforts to relax the production policy to focus on inflating revenues has gone slightly against the brand.

Brand Finance CEO David Haigh comments, "Ferrari is still in a strong position and its brand value has actually increased 18% this year to $4.7 billion. The new strategy to capitalise on the brand will certainly drive short term value but over-exploitation risks lasting damage."