Brand Value Appreciates Despite Economic Stress
Brand Value appreciated by an average of 44 percent among the BrandZ™ 2013 Top 20 Risers, compared with an average increase of 35 percent the previous year. The sharper increase suggests that strong brands gained momentum despite the fluctuating global recovery.
The Top 20 Risers individually far exceeded the substantial 7 percent brand value growth of the BrandZ Top 100 Most Valuable Global Brands overall.
The diversity of categories represented in the Top 20 Risers—apparel, banks, beer, luxury, personal care, retail, technology, entertainment and credit cards—affirms that strong brands can emerge in all sectors of the economy.
Multiple factors accounted for this performance, including Brand Contribution, the portion of brand value attributed to the brand alone and not to financial or other factors. Among the other influences were:
The introduction of desirable products, supported with clever marketing, was a key driver of brand value growth.
In other instances, brand value growth reflected value regained since the recession because of investments in the brand made during the global slowdown.
Generally, brands with a global presence were more likely to enjoy brand value appreciation, despite slower growth rates in BRIC countries.
In technology, one of two categories that declined slightly in brand value, Tencent and Samsung improved brand value 52 percent and 51 percent, respectively. In both cases, the brands demonstrated an ability to anticipate and meet consumer desires with clearly differentiated products.
Tencent expanded the user base for some of its products. Samsung gained consumer approval, and challenged Apple's dominance, with the features and marketing of its Galaxy smartphones. The smartphone success strengthened the Korean brand across its wide range of home electronics and digital devices.
The Home Depot is the only brand in the BrandZ 2013 Top 20 Risers that also appeared in last year's Top Riser ranking. The US home improvement retailer's 43 percent brand value growth follows a 31 percent increase a year ago.
During the recession, the home improvement business suffered more than most categories. As business slowed, The Home Depot acted. It improved customer service and addressed other problems that had depressed its sales, decreased its share price and tarnished its brand. Driven by the US housing recovery, consumer and contractors started spending again. And The Home Depot was ready for them.
Of the banks that improved in the BrandZ 2013 ranking, Citi and Barclays experienced the greatest lift, 37 percent and 34 percent, respectively.
These gains reflect the recovery of brand value lost because of the financial crisis. Citi's brand value declined 38 percent a year ago and has not yet reached its prerecession level.
These brand value improvements followed the initiatives by both Citi and Barclays to introduce products and services aimed at growing business in a more regulated, low interest rate environment. Barclays underwent a change of management, with the new CEO pledging to refocus the bank on customer service.
Even as the rate of economic expansion slowed in the BRIC countries, luxury sales grew. Wealthy Asian clients, for example, continued to support the brands both with purchases made at home and while traveling abroad, which helped bolster results in Europe. Prada led the list of Top Risers with a 63 percent increase in brand value. Both an increase in sales and an increase in its Brand Contribution score contributed to Gucci's 48 percent rise in brand value.
Brand Contribution also remained an important factor in beer. Brahma and Skol, two local Brazilian brands owned by global brewer AB InBev, enjoyed wide popularity at home. Based on worldwide distribution and popularity, Stella Artois, another AB InBev brand, also grew in brand value. Heineken benefited from its global premium reputation. Overall, strength in Asia, Latin America and Africa offset the weakened European economies.
The impressive brand value growth of 60 percent for Zara and 52 percent for Calvin Klein also reflected worldwide brand acceptance and growth, especially in China and other fast growing markets. The increasing brand value of Commonwealth Bank of Australia in part can be attributed to nation's economic strength relative to other developed markets.