The radical changes the Covid-19 pandemic brought about in people’s behaviour have also affected companies’ brand value ranking. Airlines, hotels and fast food chains are among those who are placed lower, while Walmart, Apple, Amazon and Google fared well.
The closest link SA has to the 2021 Brand Finance Global Value ranking is tech entrepreneur and Pretoria-born Elon Musk’s Tesla electric car company, which is the fastest-growing on a list of 500. Its brand value has increased by close to 160%, to $32bn. The company’s market capitalisation has grown by $500bn over the past year, making it worth as much as the world’s nine largest automobile manufacturers combined.
Apart from Tesla’s success it has been a difficult year for most traditional car marques, as four in five brands have either depreciated in value or stagnated.
Last year’s most valuable brand, Mercedes-Benz (down 10% to $58.2bn), has lost the most brand value of all auto manufacturers. The iconic German car company struggled to formulate a coherent electric mobility strategy and to communicate a clear vision for its electric car models. The company slipped in the ranking behind Toyota (up 2% to $59.5bn).
By comparison, SA’s most valuable brand, MTN, is worth just over $3bn and does not come close to making the 500 list.
The pandemic has also changed the nature of this year’s ranking. Aided by the increased demand for home deliveries and safe means of travel during the pandemic, Uber’s brand value jumped 34% to $20.5bn and it entered the top 100 at 82nd.
Bricks-and-mortar retailers that leveraged technology to offer online delivery and develop digital in-store improvements have also fared well during the Covid-19 lockdowns. Walmart (up 20% to $93.2bn) has inched up to sixth place in the overall ranking.
Brand Finance CEO David Haigh says: "With the onset of the pandemic, tech brands have experienced unprecedented demand for their products and services. At the same time, across sectors, brands which have pushed the boundaries of technological innovation have remained a cut above the rest."
Throttled by the pandemic, aerospace and airline companies account for six of the 10 fastest-falling brands: Boeing is down 40% to $13.6bn, American Airlines dropped 40% to $5.3bn, United Airlines sank 39% to $5bn, Delta 38% to $5.8bn and Airbus 36% to $9.1bn.
Topping the ranking, Apple has overtaken Amazon and Google to reclaim the title of the world’s most valuable brand for the first time since 2016. Apple has the success of its diversification strategy to thank for an impressive 87% rise in brand value to $263.4bn.
Amazon still managed to record a healthy 15% brand value growth to $254.2bn. The retail giant scored from the surge in demand for online buying during the pandemic.
Over the second and third quarters of 2020, ecommerce platforms had the highest revenue growth since 2016.
Also leapfrogged by Apple, Google sits in third spot after a 1% rise in brand value to $191.2bn.
Much like the aviation industry, the hospitality sector has reached an almost complete standstill both from tourism and from corporate travel.
The world’s most valuable hotel brand, Hilton, has shown a 30% drop in brand value to $7.6bn. Marriott dropped out of the ranking this year after losing more than half its brand value. Both brands operate in SA. Also in hospitality, the world’s largest fast food and café chains have borne the brunt of global lockdown initiatives, with closures destroying sales and social distancing measures changing the way customers dine.
Global leaders in the sector all recorded brand value losses: Starbucks (down 6% to $38.4bn), McDonald’s (-10% to $33.8bn) and KFC (-12% to $15.1 bn).