South Africa's most valuable brands revealed - CNBC Africa

South Africa's most valuable brands revealed

Southern Africa

by Tendai Dube 0

Brand South Africa and Brand Finance Africa announced the country’s top 50 corporate brands. Photo: Flickr

Woolworths and Capitec are the top value gainers of the year in brand value, according to a study by Brand South Africa and Brand Finance Africa where they revealed the country’s top 50 corporate brands.

Capitec grew by 63 per cent, placed at 30 and Woolworths climbed 53 per cent as the 6th most valuable brand for 2014/15.

The study suggests that Capitec can attribute its new found value on the understanding of its target market’s needs, to the extent that it changed the top 4 South African banks to the Top 5 with its addition.

The bank’s use of simple affordable products and the small unsecured loans encouraged customers to migrate to its brand.

The report states that in 2015, the bank’s 2.8 million full banking clients represented 18.3 per cent of the 15.3 million employed South Africans and its earnings stood at 2,563 million rand.

This is the third year Brand Finance Africa has conducted this study, these top 50 corporates are valued at approximately 1.5 trillion rand.

Brand SA 1

“Brands have therefore become more than just a logo or slogan. They are now seen as corporate assets which are amongst the most valuable that an organisation can have," said Thebe Ikalafeng, CEO of Brand Africa Finance.

He added: "By extension, national corporate brands also contribute to a nation’s assets in terms of the value they add to the country – both in terms of GDP as well as reputational impact”. 

Retailer Woolworths thrives on its reputation as a brand for the middle class that sells good quality for reasonable value and the brand most South Africans aspire to.

A “confident” company that has 80 years of history and strategy, not to mention the entity’s innovation with bringing international musician Pharrell Williams to South Africa, but the company is also known for its promotion of local designers and charitable efforts.

The retailer recently bought Australian department store chain David Jones for 21.4 billion rand, making it one of the “leading retailers in the southern hemisphere with 1151 stores across 16 countries” so far.

Telecommunication companies MTN maintained its position at the top despite a 4 per cent decline and Vodacom followed in second place. Oil and gas company Sasol sat in third place.

Banks dominated four of the top 10 spots led by Standard Bank and FNB.

On the flipside Cell C, despite an evidently innovative marketing team, sits at 48 out of 50 companies in brand value, above retailer Foschini and food group Sasko.

Brand SA 2

With a decline of 46 per cent, Grindrod lost the most brand value; the logistics company was at 25 in 2014 but has sits at position 44.

“While developing, strengthening and maintaining a nation’s brand is a multifaceted task, there are a range of factors which can assist in positioning the nation positively.  These factors, if based on a solid foundation, can help the nation brand weather the storms posed by the global political and economic environment,” said Kingsley Makhubela, CEO at Brand South Africa.

Brand value is calculated using the Royalty Relief approach, which estimates “the likely future sales that are attributable to a brand and calculating a royalty rate that would be charged for the use of the brand”.