[imagesource: CBM]
While the top 10 most valuable brands in Africa usually amount to some great news amidst the chaos, the COVID-19 pandemic has put a bit of a damper on things this year by decreasing the value of a number of brands across Africa.
It’s not all doom and gloom, though, especially for South Africa.
Brand Finance’s Africa 150 2020 list is out, measuring the top brands on the continent.
South Africa claimed 87 of the 150 spots and accounted for 76% of total brand value in Africa.
The rankings are determined by looking at what proportion of a business’s revenue is contributed by the brand itself.
In calculating this value, Brand Finance uses the royalty relief approach, which involves estimating the likely future revenue that could be generated by the brand by calculating a royalty rate that would be charged for its use.
This determines ‘brand value’ as a net economic benefit that a brand owner would achieve by licensing the brand in the open market.
Right, now that you know how it’s done, let’s look at this year’s rankings.
I give you the top 10:
Yeah, Woolworths barely made it in there.
South Africa’s telco giant MTN has been crowned as the continent’s most valuable brand, despite recording a 1% brand value loss to US$3,3 billion.
Vodacom (brand value down 8% to US$2,1 billion), First National Bank (down 6% to US$1,6 billion), Absa (down 3% to US$1,5 billion), and Old Mutual (up 16% to US$1,4 billion) complete the top five.
While this is good news for South Africa, Jeremy Sampson, Managing Director at Brand Finance Africa, points out that the continent as a whole should be focusing on interconnectedness:
The lack of connectedness between nations across the continent means that brands’ growth is being stifled and they are unable to flourish beyond their home markets. This does pose, however, a great opportunity for African brands to develop in a market ripe for consolidation and M&A.
Here’s Declan Ahern the Valuation Director at Brand Finance London:
No truly Pan-African brands exist, with even the highest performing brands in the ranking often only operating out of their home countries and therefore finding themselves a complete unknown across the continent and globally. It is no surprise that South Africa is by far the most represented economy in the ranking, with 87 brands featuring, which account for 76% of the total brand value.
Banking, telecoms and insurance brands have come out on top this year overall. There are nine insurance brands in the ranking, all of which hail from South Africa.
[source:brandfinance]
