Local banks DBS, OCBC and UOB have taken the top three spots in the 2017 top 100 Singapore brands ranking released by brand valuation and strategy consultancy, Brand Finance Asia Pacific.
DBS remains the most valuable Singapore brand for 2017, growing its brand value by 16% to US$5.4 billion. OCBC and UOB each grew its brand value 14% to US$3.64 billion and 16% to US$3.62 billion, respectively over the past year.
According to Jake Ng, consultant at Brand Finance Asia Pacific, 30% of the total brand value in Singapore is contributed by the three local banks, also known as the "Formidable Three". This is up 27% compared to 2016.
He said Brand Finance expects the "Formidable Three" to dominate the top three spots again next year as the acquisitions carried out by the banks in 2016 will provide a boost to the brands' values. "The growth is in line with other financial brands around the world but we wish to see a more diverse mix [of brands] at the top," Ng added.
ComfortDelGro and Genting Singapore experienced a 12% and 23% value growth respectively, making their way into the top 10 and replacing Sembcorp and Keppel, both hit by the shipping industry slump. Despite CapitaLand's brand value surging 69%, it missed the 10th spot and came in 11th.
According to the press statement, the total value of top 100 Singapore brands in 2017 has increased by 4% from US$41.1billion to US$42.6 billion.
Samir Dixit, managing director of Brand Finance Asia Pacific, said the top 100 Singapore brands ranking remains very top heavy, with the top 10 brands contributing 57% of the total brand value and the bottom 50 contributing 93%.
In a statement to Marketing, Dixit said more local brands can break into the top 10 by being brand-driven rather than "use sales tactics and discounts as a way of selling where the brand is incidental". He added that having a strong brand allows it to "command price premium, leading to better revenues, profits and growth".
Brand strength still a concern for most Singapore companies
While the overall brand value has increased, Brand Finance noted that the companies' brand strength have stagnated and they have been losing out to key competitors in the region as the companies "lack competitiveness outside of the Singapore market".
According to Dixit:
If companies that do not raise their brand strength will become non-competitive over time and their brand value drops continuously.
"A high brand strength indicates that the brand has the ability to drive the business and has the required market pull, whereas weak brand strength means that the business is driving the brand and has to continuously create the market push," he said.
To improve, Dixit advises companies to be familiar with their comparative brand strength and identify areas where they are weak or less competitive as well as constantly track their brand strength.
Additionally, brands can make themselves more competitive outside of Singapore by "focusing on their brand equity and comparable brand strength" rather than just boosting their presence and conducting tactical sales, he said.
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"A brand has 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.
According to Dixit, brand strength is a comparable score out of 100 that indicates how strong or weak a brand is in comparison to the rest of the market. It is an index that defines the correlation of a brand's input such brand presence and promotional activities, to the equity generated such as loyalty, trust and recommendation, to the output of the brand such as revenue and profit. The score is represented through brand rating ranging from AAA+ to DDD-.