DBS has surpassed Singtel as the nation's strongest brand with a Brand Strength Index (BSI) score 87.1 out of 100 and a corresponding AAA brand strength rating, according to Brand Finance. Despite relinquishing the top spot, Singtel still retained its AAA brand strength rating, the only other brand to do so. Meanwhile, OCBC Bank, Changi Airport Group, M1 and StarHub were among the top 10 strongest brands in Singapore.
The average BSI of the Top 100 most valuable Singaporean brands has increased slightly from 61.5 out of 100 last year to 61.8 out of 100 this year. Most brands, however, have remained stagnant in terms of brand strength, Brand Finance said. While they may be doing well locally, they have been losing out to some of the key competitors in the region as they lack competitiveness outside of the Singapore market.
Brand Finance Asia Pacific's MD Samir Dixit explained that unless companies have a strong brand agenda and are managing the strength and value of their brands in a concentrated manner, there will continue to be large year-on-year variations in brand value, brand strength and brand rankings.
The big problem is the brand is left to a few people in the organisation to manage and is never a serious agenda for the board.
According to him, this is "clearly evident" as most of the top management or the boards have no brand KPIs for themselves or their firms. "Most Singapore brands are typically very communications focused and misunderstand their campaigns – which are mostly digital these days - to be brand-building initiatives and that’s where they miss the big picture about the brand," he explained.
Moving forward, Singapore companies need to be more brand-driven instead of sales or offers-driven as this "destroys the long-term value and the strength of the brand", Dixit said. Branding needs to be a strategic agenda for the senior management and boards and must be managed like any other business asset and not just a legal trademark, he added.
Brand Finance determines the brand strength by analysing three core pillars: inputs, which are activities supporting the future strength of the brand; equity, which are real current perceptions sourced from its market research and other data partners; and output, which are brand-related performance measures such as market share. Each brand is assigned a BSI score out of 100, which feeds into the brand value calculation. Based on the score, each brand is assigned a corresponding brand rating up to AAA+ in a format similar to a credit rating. Alongside revenue forecasts, brand strength is also seen by Brand Finance as a crucial driver of brand value.
Top 10 most valuable brands in Singapore
In addition to being ranked Singapore's strongest brand, DBS has once again been crowned the most valuable brand in Singapore for the ninth consecutive year with a brand value of US$7.81 billion. Rounding off the top three spots were OCBC Bank and UOB. According to Brand Finance, no other contenders were able to challenge the top three spots and it is also unlikely that DBS will be dethroned from top of the Brand Finance Top 100 Most Valuable Singapore Brands table "for a long time".
OCBC has managed to maintain its second position with a brand value of US$4.5 billion while UOB has widened the gap this year with a brand value of US$3.9 billion. The three banks have contributed 38% of the total brand value in Singapore, up marginally from 37% last year.
Dixit said financial companies continue to form over 35% of the top 100 value. "As Singapore further develops, we expect consolidation in the banking sector, so it will be interesting to see which brands remain. Banks who can digitalise and remain relevant will be the ones who will win," he added.
The other brands in the top 10 were Singtel, Great Eastern, Singapore Airlines, SPC, Wimar, Tiger and Olam. Tiger and Olam made the rankings for the first time this year, nudging CapitaLand and ComfortDelGro out of the top 10. Tiger saw a leap in ranking from 19th last year to ninth this year. In the meantime, Olam saw a jump ahead of five positions from 15th to 10th this year.
On the other hand, Wilmar reported a huge drop in brand value and ranking, although it still maintained its foothold in the top 10. According to Brand Finance, Tiger and Olam were the only two brands in the top 10 that have recorded a brand value increase while the remaining eight all saw a drop.
MindChamps was also a new entrant into the ranking in 58th place, with a brand value of US$58 million. This year also saw other four new entrants including AEM, creative, UG Healthcare and MoneyMax. Brand value refers to the present value of earnings specifically related to brand reputation. Organisations own and control these earnings by owning trademark rights.
"While Singaporean brands have grown, they will likely face strong headwinds ahead as they lose out to some other brands in the region in terms of brand competitiveness and value growth. It is the brand strength for most brands that still remains a concern and also a significant risk. Brands must recognise this and work towards mitigating it," Dixit said.
As of now, the rankings still remain very top-heaving, which is a cause for concern according to Dixit, since the top 10 contributes over 62% of total brand value. A more diverse mix at the top is encouraged and a more significant value increase at the bottom, which means that other brands must start focusing on their value and brand strength.
Photo courtesy: 123RF
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