Indian brand value grows by a third: BrandZ

The total value of India's strongest brands has risen by a third (33%) over the last year, according to the second annual BrandZ Top 50 Most Valuable Indian Brands* ranking by WPP and Millward Brown. This is the highest rate of growth achieved by any BrandZ ranking in the 10 years since valuations began, exceeding that of the Global Top 100 as well as the rankings for China, Latin America and Indonesia.

India's Top 50 brands are now worth US$92.2 billion, up from just under US$70 billion in 2014. The increase has been driven by brands' successful response to the rising sense of empowerment among Indian consumers, and the government's efforts to create a more conducive business environment.

Brands in the financial sector (49% growth) made the largest contribution to the overall increase in value, but significant lifts were also seen across most other sectors, indicating the broad strength of India's economy and Indian brands. Home and personal care brands achieved a combined increase of 32%, followed by the auto aftermarket sector (28%), automobile brands (27%) and telecom providers (21%).

Private companies, state-owned enterprises (SOEs) and brands owned by multinational corporations that are publicly traded in India all experienced growth, illustrating how receptive the market is to brands of all kinds. More than half (52%) of the brands in the Top 50 are privately-owned, evidence of India's entrepreneurial energy. 30% of the brands are owned by multinationals, which have successfully adapted to the needs of Indian consumers, becoming so embedded in their lives that they are perceived as 'local'.

The BrandZ Top 50 Most Valuable Indian Brands 

   
        Rank                                   Brand value   Brand value     Rank
        2015               Brand    Category     2015 ($m)        change     2014
           1           HDFC Bank       Banks        12,577           33%        1
           2              Airtel    Telecoms        11,039           34%        2
           3 State Bank of India       Banks         9,374           37%        3
           4          ICICI Bank       Banks         5,122           45%        4
           5        Asian Paints      Paints         3,867           38%        6
           6          Bajaj Auto Automobiles         3,345           10%        5
           7                Hero Automobiles         2,907           34%        7
           8           Axis Bank       Banks         2,494           New      New
           9 Kotak Mahindra Bank       Banks         2,394           39%        9
          10       Maruti Suzuki Automobiles         2,318           54%       11
          11                Idea    Telecoms         1,981            5%        8
          12             Castrol  Lubricants         1,773           40%       15
          13       IndusInd Bank       Banks         1,542           46%       19
          14          McDowell's     Alcohol         1,516            9%       13
          15              Nestlé  Food/dairy         1,498           22%       16

Key highlights of the study include: 

Financial brands continue to dominate. With 13 brands in the Top 50, accounting for 41% of its value (US$38.1 billion), the financial sector has built brand strength by making a consistent effort to serve consumers better. The biggest risers are the Union Bank of India (no.46, +72%), Punjab National Bank (no.22, +61%) and IndusInd Bank (no.13, +46%). 

Home and personal care brands grew 32%, driven by increased disposable income and spending on premium products, and investment by marketers across traditional and new media. The 12 brands in this segment account for 15% (US$13.4 billion) of the ranking's total brand value. The fastest risers are Lakme (no.44, +69%), Lifebuoy (no.31, +49%) and Colgate (no.26, +44%).

Indian consumers expect brands to actively participate in building a better society, and those that do have a higher brand value. Lifebuoy (no.31) has a social mission to change consumers' hygiene behaviour, while Asian Paints (no.5) aspires to rejuvenate people's living spaces and bring joy to their lives.

In contrast with other markets, trust in brands is growing steadily. Consumers in India appreciate brands, and 33% say they trust them. Among the most trusted are jeweller Tanishq (no.21), part of the respected Tata conglomerate, and Colgate, which is part of Indian folklore, and has been instrumental in organising dental checkup camps to raise dental hygiene awareness.

All four new entrants are of Indian origin - Axis Bank, Canara Bank, MRF (tyres) and Royal Enfield. Three are privately owned, and one is an SOE.

Disruption is on the horizon, from e-commerce and mobile brands that are building scale and connecting with consumers at a frenetic pace. These are not yet eligible to be ranked in the Top 50 because they are not publicly traded.

The BrandZ India Top 50 outperforms SENSEX (a weighted index of 30 stocks on the Bombay Stock Exchange), showing how valuable brands deliver superior returns. A stock portfolio comprised of the Top 50 increased their share value 18.6% between August 2014 and July 2015, while India's SENSEX index increased only 1.5%. The ROI produced by the BrandZ portfolio was over 12 times greater.

David Roth, CEO of WPP's The Store commented: "The 2015 study shows that India is a market of great opportunities where consumers are feeling empowered, and this is increasingly reflected in their brand choices. The new Modi government is committed to creating an environment in which brands can flourish. India is distinct in many ways from other fast-growing markets, however, so simply applying strategies that have proved successful elsewhere will not work in India. Any brand intending to compete in India must gain deep insights into its nuances - such as the need to modernise while respecting the past, and the desire to remain fundamentally Indian."

Prasun Basu, Millward Brown's Managing Director, South Asia said: "India's top brands are strong, and getting stronger - but there is no room for complacence. The top four had to grow their value by 37% on average to hold on to the same positions as last year, and close to 10% of the brands that made the Top 50 in 2014 have dropped out. To benefit from the continuing rise in consumer confidence and optimism brands need to understand the changing consumer, respond with innovative products and breakthrough communication, and experiment and invest in new media that reflect the spirit of the country today."

Ranjan Kapur, Country Manager, WPP India, added: "Building a successful brand in India also means helping to build India itself. Consumers are trustful of brands, but trust can crumble overnight. Brands must work hard to sustain trust by connecting with the country's communal sense of responsibility. Brands need to find ways to support the national agenda, and help to develop a more modern, prosperous and equitable society."

Interested?

The India Top 50 is part of the BrandZ family of brand valuations, which also includes the Global Top 100 (released 27 May 2015), Indonesia Top 50 (released 19 August 2015), Latin America Top 50 (to be released 23 September) and China Top 100 (to be released February 2016).

Download a copy of The BrandZ Top 50 Most Valuable Indian Brands 2015 report

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*The brand valuation behind the BrandZ Indian Top 50 was conducted by Millward Brown, WPP's specialist marketing and brand consultancy. The methodology mirrors that used to calculate the annual BrandZ Top 100 Most Valuable Global Brands ranking, which is now in its tenth year.

The valuation combines rigorously analysed financial data from Bloomberg and Kantar Worldpanel with the opinions of more than 100,000 consumers, for over 1,000+ brands in 78 categories. All brands meet these two eligibility criteria:
The brand is owned by an enterprise listed on a stock exchange in India 

In the case of banks, at least 25% of earnings were derived from retail business. 

The valuation methodology behind the BrandZ Top 50 Most Valuable Indian Brands ranking is the only one that combines financial data with the perceptions of Indian consumers, making it the definitive study of the most accomplished brands in this fast-growing market. The ranking is accompanied by a detailed report that analyses the success of the Top 50, identifies the key forces driving brand growth in India, and makes action-oriented recommendations to help brands successfully navigate this environment.

Tencent is the most valuable brand in Asia today: BrandZ

China's Tencent is the most valuable Asian brand and the fastest-growing brand in the world, according to the 2014 BrandZ Top 100 Most Valuable Global Brand rankings. The brand almost doubled its value to US$54 billion to rise to No. 14 globally, overtaking China Mobile in the process.

Source: Millward Brown website.

"The big story here is that a market-driven Chinese brand is now at the top, rather than a state owned enterprise (SOE) that might have benefited from being a monopoly. Tencent continues to innovate and increasingly plays a bigger role in helping people to organise their lives, like other successful brands such as Google and Facebook," said Deepender Rana, Managing Director of Millward Brown Greater China.

"With 11 brands in the Top 100, China continues to have the largest representation from Asia. However, Chinese brands should not be complacent about the need to continuously invest their brand-building, as apart from the technology brands, other brands saw significant fluctuations. There is a need for the big SOE brands to become more market-oriented, and for Chinese brands to go abroad to become truly global," Rana further added.

Globally, Google has overtaken Apple to become the world's most valuable global brand in 2014. The brand is  worth US$159 billion, an increase of 40% year on year.

After three years at the top, Apple is now No. 2 on the back of a 20% decline in brand value, to US$148 billion. Whilst Apple remains a top performing brand, Millward Brown notes that there is a growing perception that it is no longer redefining technology for consumers, reflected by a lack of dramatic new product launches. The world's leading B2B brand is still IBM at No. 3, with a brand value of US$108 billion. 

Nick Cooper, Managing Director of Millward Brown Optimor, commented: "Google has been hugely innovative in the last year with Google Glass, investments in artificial intelligence and a multitude of partnerships that see its Android operating system becoming embedded in other goods such as cars. All of this activity sends a very strong signal to consumers about what Google is about and it has coincided with a slowdown at Apple."

"This year's index highlights the end of the recession, with a strong recovery in valuations and, for the first time, real growth across every category and the Top 100 as a whole," said David Roth, CEO of The Store, WPP. "What's remarkable is the way that strong brands have led the recovery. Seventy-one of the brands listed in our 2014 Top 100 were there in 2008. Despite the financial turmoil and the digital disruption that have decimated many businesses during the last few years, these brands have remained in the ranking, proving the durability of strong brands."

The BrandZTop 100 Most Valuable Global Brands study, commissioned by WPP and conducted by Millward Brown Optimor, is now in its ninth year. It is the only ranking that uses the views of potential and current buyers of a brand, alongside financial data, to calculate brand value.

The combined value of the Top 100 has nearly doubled since the first ranking was produced in 2006. The Top 100 today are worth US$2.9 trillion, an increase of 49% compared with the 2008 valuation, which marked the start of the banking and currency crisis.

The BrandZ Top 10 Most Valuable Global Brands 2014

Rank 2014	Rank  2013	Brand	Category	Brand Value 2014 ($M)	Brand Value Change
1	2	Google	Technology	158,843	+40%
2	1	Apple	Technology	147,880	-20%
3	3	IBM	Technology	107,541	-4%
4	7	Microsoft	Technology	90,185	+29%
5	4	McDonald's	Fast Food	85,706	-5%
6	5	Coca-Cola	Soft Drinks	80, 4683	+3%
7	9	Visa	Credit Cards	79,197	+41%
8	8	AT&T	Telecoms	77,883	+3%
9	6	Marlboro	Tobacco	67,341	-3%
10	14	Amazon	Retail	64,255	+41%

Key findings highlighted in this year's research report include:  

Share of Life: Successful brands such as Google (No. 1), Tencent, Facebook, Twitter, and LinkedIn are more than just tools; they have become part of our lives. They offer new forms of communication that absorb people's attention and imagination, while also helping them organise the rest of their lives at the same time. To gain more of our mind-space, brands such as Tencent and Google are even crossing categories. This trend also pushed No. 1 Apparel brand Nike, a prime example of a brand seeking to become a share of life brand, to offer services such as Nike+ that extend well beyond its functional raison d'etre. 

Technology brands performed strongly and had the highest total value: Although technology companies are less than a fifth of the Top 100, they make up nearly a third of the value of the BrandZ Top 100 ranking. Service-based brands are thriving while product-based companies are struggling. Product-based companies like Samsung, HP and Sony under-performed relative to Tencent, Facebook and Baidu.  

Apparel fastest growing category: The top 10 apparel brands grew in value by 29% to nearly US$100 billion this year, outpacing cars (up 17%) and retail (up 16%). Uniqlo, Nike and Adidas all recorded double-digit increases in their valuation.
 
Strong brands provide faster growth: An analysis of the BrandZ rankings as a 'stock portfolio' over the last nine years shows a highly favourable performance compared to a wider stock market index, the S&P500. While the value of the companies in the S&P500 index grew by 44.7%, the BrandZ portfolio grew by 81.1%, proving that companies with strong brands are able to deliver better value to their shareholders.

Brands from the Western World bounced back with a greater proportion of both the number and value of brands within the top 100. This reflected the resilience of established brands and the breakthrough of new brands, as well as improved economic conditions. As a result, the number of brands from fast growing economies slipped in 2014. China, with 11 brands, continues to have the largest representation. 

Chinese brands grew slower and are in urgent need of internationalisation: The 11 Chinese brands listed in the ranking had a combined value of US$280 billion this year. China's overall brand value was on the rise, but at a slower pace than the global level. Except for technology brands that out-performed, other industries saw significant fluctuations. In a world where brands and technology are becoming increasingly international, going global has emerged as a very urgent task for Chinese brands. Overseas consumers have now begun to associate Chinese brands with being innovative and global, which establishes the foundation for Chinese brands to compete on the international stage. Chinese brands can differentiate themselves through innovation, and gain access to international markets faster at a lower cost by making use of the Internet.

Listed Chinese brands

Rank  2014	Brand	Category	Brand Value ($M)	Brand Value Change
14	Tencent	Technology	53,615	+97%
15	China Mobile	Telecom Providers	49,899	-10%
17	ICBC	Bank	42,101	+2%
25	Baidu	Technology	29,768	+46%
33	China Construction Bank	Bank	25,008	-7%
54	Agricultural Bank of China	Bank	18,235	-9%
67	Sinopec	Oil & Gas	14,269	+9%
68	Bank of China	Bank	14,177	0%
76	PetroChina	Oil & Gas	12,413	-7%
77	Ping An	Insurance	12,409	+18%
81	China Life	Insurance	12,026	-21%

The BrandZ Top 100 Most Valuable Global Brands report, rankings and a great deal more brand insight for key regions of the world and 13 market sectors are available online here. A new suite of interactive smartphone and tablet applications will also be available for free download via Apple IOS and all Android devices from www.brandz.com/mobile, or search for BrandZ in the respective iTunes or Google Play app stores.