Brand Finance

Download logo: pdf svg eps png

Bud Light and Budweiser Brand Values Bubble Up

·         Bud Light and Budweiser remain world’s most valuable beer brands, both breaking US$7 billion mark, as 25 most valuable beer brands grow by 19% on average

·         Belgian beer brewer AB InBev boasts 13 brands in top 25

·         China’s Harbin is world’s fastest-growing beer brand, up 69% year on year

·         Asahi battling changing Japanese consumer tastes, down 34% from 2017

·         Brazil’s Brahma is the world’s strongest beer brand with 88.3/100 score

View the full list of the world’s 25 most valuable beer brands here

Bud Light remains the world’s most valuable beer brand, with its brand value increasing by 12% to US$7.4 billion since last year, according to the latest report by Brand Finance, the world’s leading independent brand valuation and strategy consultancy. Despite a reduction in sales in 2017, the value of Bud Light’s brand increased in connection with its well-received “Dilly Dilly” marketing campaign, and the launch of its product into the United Kingdom.

Budweiser (up 21% to US$7.1 billion) enjoyed strong growth, retaining second place and narrowing the gap behind Bud Light. Despite a decade of decline in the brand’s American sales, Budweiser continues to benefit from its leadership position in the mainstream beer market. With an average brand value growth of 19% year on year, other global brands ranked in the Brand Finance Beers 25 league table also hold their own in the face of new challenges posed by the craft beer revolution.

David Haigh, CEO of Brand Finance, commented:

“The world’s biggest beer brands have been able to build deep customer loyalty by representing an accessible but aspirational lifestyle. Creative marketing campaigns are equally important as the taste and packaging. They help the established market leaders compete with challenger brands on their home turf by promising their consumers an experience rather than just a product. The top brands will continue to face challenges from craft beers but smart marketing combined with the scale of production and distribution capabilities of the big conglomerates is a strong defence strategy."

Belgian Beer Brewer’s 13 Brands
AB InBev dominates the ranking as its brands claim 13 out of the top 25 spots. The Belgian conglomerate has had a remarkably successful year with their family of beer brands growing strongly across the world, a credit to its global presence; operating across London, Sao Paulo, New York, Johannesburg, and Mexico City. AB InBev has also been investing in Africa, where beer consumption is on the rise, and has announced plans to build a US$100m brewery in Tanzania.

Harbin and Aguila Fly High
Harbin (up 69% to US$3.5 billion) in China and Aguila (up 52% to US$1.4 billion) in Colombia are the world’s fastest-growing beer brands this year ahead of Thailand’s Chang (up 48% to US$1.3 billion) and Mexico’s Corona Extra (up 43% to US$3.4 billion). Harbin, Aguila, and Corona are all part of the AB InBev family and have been able to leverage the global giant’s output capacities to their advantage.

Asahi Battles Changing Consumer Tastes
Asahi (down 34% to US$2.0 billion), on the other hand, lost more brand value this year than any other brand in the ranking and dropped out of the top ten, falling from fifth position in 2017 to twelfth most valuable beer brand this year. This reflects a change in Japanese consumer tastes, with preferences shifting towards other drinks as Japanese beer consumption has been recorded at an all-time low. Consequently, the Asahi Group has acquired beer brands outside Japan as it seeks to diversify its geographic distribution of earnings.

Brazil’s Brahma Boasts Best Brand Strength
Aside from determining overall brand value, Brand Finance also evaluates the relative strength of brands through a balanced scorecard of metrics on marketing investment, stakeholder equity, and business performance. Along with the level of revenues, brand strength is a crucial driver of brand value.

According to these criteria, Brazil’s Brahma is the world’s strongest beer brand with a Brand Strength Index (BSI) score of 88.3 out of 100 and a corresponding AAA brand rating. Brahma invested heavily in building its brand awareness through a series of high-profile advertising campaigns, mustering strong results in the domestic Brazilian market and further complemented by international sales.

View the full Brand Finance Beers 25 2018 report here

ENDS

Note to Editors

Every year, leading valuation and strategy consultancy Brand Finance values the world’s biggest brands. The 25 most valuable beer brands in the world are included in the Brand Finance Beers 25 2018 league table.

Brand value is understood as the net economic benefit that a brand owner would achieve by licensing the brand in the open market. Brand strength is assessed through a balanced scorecard of metrics on marketing investment, stakeholder equity, and business performance, and used to determine what proportion of a business’s revenue is contributed by the brand.

Additional insights, more information about the methodology as well as definitions of key terms are available in the Brand Finance Beers 25 2018 report.

Brand Finance helped craft the internationally recognised standard on Brand Valuation – ISO 10668, and the recently approved standard on Brand Evaluation – ISO 20671.

Data compiled for the Brand Finance league tables and reports are provided for the benefit of the media and are not to be used for any commercial or technical purpose without written permission from Brand Finance.

Media Contacts

Konrad Jagodzinski
Communications Director
T: +44 (0)2073 899 400           
M: +44 (0)7508 304 782         
k.jagodzinski@brandfinance.com

Sehr Sarwar
Communications Manager
T: +44 (0)2073 899 400
M: +44 (0)7966 963 669
s.sarwar@brandfinance.com

About Brand Finance          
Brand Finance is the world’s leading brand valuation and strategy consultancy, with offices in over 20 countries. Brand Finance bridges the gap between marketing and finance by quantifying the financial value of brands. Drawing on expertise in strategy, branding, market research, visual identity, finance, tax, and intellectual property, Brand Finance helps brand owners and investors make the right decisions to maximise brand and business value.

Methodology
Definition of Brand
Brand Finance helped to craft the internationally recognised standard on Brand Valuation – ISO 10668. It defines a brand as a marketing-related intangible asset including, but not limited to, names, terms, signs, symbols, logos, and designs, intended to identify goods, services or entities, creating distinctive images and associations in the minds of stakeholders, thereby generating economic benefits.

Brand Strength
Brand Strength is the efficacy of a brand’s performance on intangible measures, relative to its competitors. In order to determine the strength of a brand, we look at Marketing Investment, Stakeholder Equity, and the impact of those on Business Performance.

Each brand is assigned a Brand Strength Index (BSI) score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding rating up to AAA+ in a format similar to a credit rating.

Brand Valuation Approach
Brand Finance calculates the values of the brands in its league tables using the Royalty Relief approach – a brand valuation method compliant with the industry standards set in ISO 10668. It involves estimating the likely future revenues that are attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a ‘brand value’ understood as a net economic benefit that a brand owner would achieve by licensing the brand in the open market.

The steps in this process are as follows:

1 Calculate brand strength using a balanced scorecard of metrics assessing Marketing Investment, Stakeholder Equity and Business Performance. Brand strength is expressed as a Brand Strength Index (BSI) score on a scale of 0 to 100.

2 Determine royalty range for each industry, reflecting the importance of brand to purchasing decisions. In luxury, the maximum percentage is high, in extractive industry, where goods are often commoditised, it is lower. This is done by reviewing comparable licensing agreements sourced from Brand Finance’s extensive database.

3 Calculate royalty rate. The BSI score is applied to the royalty range to arrive at a royalty rate. For example, if the royalty range in a sector is 0-5% and a brand has a BSI score of 80 out of 100, then an appropriate royalty rate for the use of this brand in the given sector will be 4%.

4 Determine brand-specific revenues by estimating a proportion of parent company revenues attributable to a brand.

5 Determine forecast revenues using a function of historic revenues, equity analyst forecasts, and economic growth rates.

6 Apply the royalty rate to the forecast revenues to derive brand revenues.

7 Brand revenues are discounted post-tax to a net present value which equals the brand value.

Please get in touch: