Telstra has yet again nabbed the top spot as Australia’s most valuable brand. For the second consecutive year, Telstra has secured itself as the most valuable brand in Australia, according to Brand Finance’s Australia Top 100 research.
The annual ranking from this valuation and strategy consultancy ranks brands by monetary value and calculates the most “powerful” brands, as defined by the companies whose enterprise value is most positively impacted by the strength of their brand.
To determine a brand’s value, Brand Finance evaluates factors such as marketing investment, familiarity, loyalty, staff satisfaction and corporate reputation to determine the ‘strength’ or ‘power’ of a brand. Brand power determines the proportion of overall business revenue that is contributed by a brand.
Brand Finance Australia managing director, Mark Crowe, said Telstra’s business performance led to a positive impact on brand value. Its reported revenue increased two per cent, while the expected cumulative annual growth rate has also improved from 3.7 per cent in 2016 to 4.2 per cent this year.
But its customer brand equity fell slightly over the last year, with scores on individual metrics such as consideration, satisfaction and recommendation falling marginally.
“It is testimony to Telstra’s brand strength that despite a decline of 18 per cent in enterprise value, Telstra’s brand value has only decreased by two per cent,” he said.
Telstra also ranked 125th in Brand Finance’s Global 500 list.
In comparison, Optus was the ninth ranked Australian brand, recording a 12 per cent decline in brand value.
“Optus’ business performance worsened over the course of last year, with Optus’ brand value falling,” Crowe added.
JB Hi-Fi ranked 24th on the list this year, a jump from the 42nd position it held last year. This follows its recent binding agreement to acquire fellow electronics and appliance retailer, The Good Guys, for a cash consideration of $870 million.
iiNet jumped up a spot to the 54th position this year, while TPG’s ranking plummeted from 53rd to 64th.
Vocus Communications, regardless of its leadership shake-up late last year, and MYOB, which recently acquired ERP software vendor, Greentree, for about $NZ28.5 million, joined the list, coming in at 88th and 90th, respectively.
On the Brand Finance’s Global 500 list, Apple gave up its five-year reign to 2016 runner-up, Google, this year. Google has overtaken Apple as the world’s most valuable brand, with the latter’s brand value dropping 27 per cent over 2016.
Google’s brand value rose by 24 per cent in 2016 from $US88.2 billion to $US109.5 billion, while Apple’s declined from $US145.9 billion to $US107.1 billion. Google last held the title of world’s most valuable brand in 2011.
Brand Finance CEO, David Haigh, said Apple has struggled to maintain its technological advantage.
“New iterations of the iPhone have delivered diminishing returns and there are signs that the company has reached saturation point for its brand. The Chinese market, where Apple has enjoyed a dominant market share, is becoming far more competitive with local players entering the market in a meaningful way.
“Samsung [in sixth place] has also been successful in taking market share and financial analysts are projecting declining revenues and margin,” he said.
Amazon retained its third position, while Microsoft dropped one position from last year to the fifth spot. NTT Group jumped up a few spots to 15th after securing itself in the 22nd position last year.
IBM moved up one spot to 20th, while GE ranked 22nd, Oracle ranked 38th, Huawei ranked 40th, Siemens ranked 45th, and Vodafone ranked 50th this year in the Global 50.