MEXICO CITY, Mexico, September 24, 2014
Food, Retail And Beer Brands Show Strongest Growth - Evolving To Stay Highly Relevant As Consumers Become More Prosperous
For the second consecutive year Mexican beer brand Corona is the most valuable brand in Latin America, according to the BrandZ™ Top 50 Most Valuable Latin American Brands 2014 ranking announced today. The valuation was carried out by Millward Brown Vermeer, in conjunction with WPP. Now worth US$8 billion after a 21% increase in brand value, Corona's continued strength reflects its solid brand positioning and the positive feelings consumers have towards it - both in Mexico and overseas.
The total brand value of the Top 50 declined 4.5% compared with 2013 - decreasing from US$135.3bn to US$129.2bn. Three sectors grew: Beer (+13%), Food (+21%) and Retail (+14%). The brands in these sectors successfully evolved their value propositions to remain deeply relevant to Latin American consumers as they become more prosperous and consumption increases - in particular by implementing strategies to meet the needs of the expanding middle classes.
Mexican brands once again hold the greatest proportion of the ranking's overall value, with their contribution rising from 29% to 33% in the last year, led by the strong market performance of beer brands, communication providers, retailers and financial institutions. Brazilian brands' share of the Top 50 dropped from 28% to 24% after the country's stock exchange experienced the second largest dip in the world. Chile, where well-positioned retail brands dominate, increased its contribution from 19% to 20%. Colombia (16%) and Peru (4%) maintained their positions - financial institutions have the greatest representation in Colombia and beer in Peru. Argentina (1%) is represented by oil brand YPF.
There were six new entrants in 2014: Marinela (Mexican food brand), Ipiranga (Brazilian retail brand), Pilsen Callao (Peruvian beer brand), Tottus (Chilean retail brand), Banamex (Mexican financial institution) and Une (Colombian communication provider).
Eduardo Tomiya, Managing Director of Millward Brown Vermeer, says: "2014 was a very good year for consumer goods brands (9% growth) and retail brands (14% growth), which kept themselves highly relevant as consumers' needs evolved. Brands that have positioned themselves successfully for middle class consumers increased substantially in value in the Latam region. Meanwhile those that failed to profit fully from consumers' increased purchasing power, such as telecom brands, or which have had to restrict their brand building activities, like financial institutions, have seen their brand value drop."
Gonzalo Fuentes, CEO of Millward Brown Latin America, says: "Latin America's iconic local brands have achieved huge success through engaging with and representing the motivations of consumers in their 'home' country. They must now transcend this local success and expand their market by building propositions that connect with the wider Latam region. Huge growth opportunities exist for those that start looking at the whole region as their playground, and work to become true Latam brands."
Key themes highlighted in the BrandZ Top 50 Most Valuable Latin American Brands include:
- The biggest risers have made themselves even more meaningful: Beer brand Modelo (+51%) has a deep understanding of its consumers, and builds on its differentiation - presenting itself as a young yet sophisticated brand, and creating a sense of status and craftsmanship. The Liverpool department store (+30%) skilfully inserts itself into consumers' lives (its slogan translates as 'Liverpool is part of my life') and makes its offer accessible to all. Banorte (+59%) always seeks to deliver the best service through innovations in the customer experience - partnering with IBM to develop a more customer-oriented banking model, and launching an award-winning mobile app.
- Responding to middle class needs captures value growth: Consumer and retail brands have excelled at this - including Brahma (No.8), which created Brahma Fresh to compete against low price beers in the affluent north-east region, and retailers Falabella (No.3) and Sodimac (No.6) which increased 14% in value after successfully meeting the needs of the growing middle class.
- Another good year for beer: Five of the Top 10 are beer brands, three of which grew in 2014, helping to bolster the ranking's overall fall in value.
- Local icons never stop moving: Powerful local brands including Skol, Águila, Sodimac and Inca Kola all remained relevant to existing customers while also attracting new ones, by improving their offer. Bradesco (No.5) in Brazil, traditionally a bank for middle class consumers, improved its offer for low-end consumers, while Mexican Telcel's (No.4) clear cross-class positioning of 'Telcel is the network' enabled it to hold on to a 70% market share - even after deregulation.
- New 'brand houses' are seeing brand value rise as a result of mergers: Groups that were formed through mergers and acquisitions are beginning to see the fruits of their mighty brand development work: the Latin American brands that belong to AB-Inbev represent 19% of the Top 50, and SAB Miller 7% for example. Brands in the same group are able to save operating costs by complementing each other's strengths, and increase communication and marketing efforts.
- Geographical expansion boosts brand value: Mexico's Corona and Chile's Falabella have built sustainable growth by positioning themselves as Latin American brands abroad, and successfully competing in different markets. They will soon be followed by Colombian brands such as Bancolombia, Avianca, Grupo Sura and Brazilian brands such as Itaú, Sadia, Natura and Vale.
The BrandZ™ Top 50 Most Valuable Latin American Brands 2014 analyses and determines the value of brands from Argentina, Brazil,Chile, Colombia, Peru and Mexico. Together, these nations represent around US$5 trillion in GDP, the equivalent of the world's third largest economy ahead of Japan. It is the only ranking that takes into account the views of potential and current buyers of a brand, alongside financial data, to calculate its value.
To download the full report including all the ranking data and context go to http://www.brandZ.com.
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