Inaugural ranking highlights areas of opportunity
Top 50 UK brands worth over £173 billion
The combined value of the BrandZ Top 50 Most Valuable UK Brands 2017 is $234,494 million (or roughly £173,700 million).
Vodafone is the UK’s most valuable brand
The telecom brand with a mission to deliver communications power to the people tops the inaugural BrandZ Top 50 UK Brands ranking, with a brand value of just under $27.3 billion. Vodafone’s communications often take a fun, celebrity-studded look at the power of great connections and digital services, and position the brand as an innovator in the sector. From small beginnings in the south of England, Vodafone has grown into a global brand with more than 400 million customers.
Mega brands dominate the ranking
Value is concentrated at the top of the UK ranking, with the number one brand, Vodafone, accounting for 12 percent of the value of the entire Top 50, and the top five brands contributing more than a fifth of the brand value of the leading 50 brands combined. This domination of the ranking by a small number of mega brands is a pattern we see in other markets. In France, for instance, almost half of the Top 50’s value comes from just five brands. This phenomenon is less pronounced among the Top 50 brands in the BrandZ Top 100 Most Valuable Global Brands 2017; that ranking has a greater proportion of high-value brands, and the number one brand, Google, accounts for only 8 per cent of the Top 50’s value.
Giants of industry top UK table
Financial services brands, telecom providers and utilities occupy many of the top positions in the UK brand ranking, and account for a disproportionately high level of the value of the entire Top 50. These infrastructure brands – seven telecom provider's, eight in banking and finance, and four in utilities – take 19 of the Top 50 places, but contribute 62 percent of the value. Many of these are global brands, and reflect the UK’s role as a global centre for financial services and its historical role in energy exploration, as well as consumers’ current appetite for connectivity. There are four telecom provider brands in the Top 10, two banks, and two oil and gas brands.
Well known, but lacking innovation
The most valuable brands in the UK are long-standing household names that many people have grown up with. Everybody knows these brands, and on the BrandZ measure of fame, they hugely over-index, which means they readily spring to mind when a consumer thinks of their category. But these brands are less strong when it comes to being known for something. Either their mission isn’t clear to consumers, or it’s clear, but it’s not something that people feel a strong connection with. Innovation is one of the attributes that BrandZ research shows is strongly linked to increases in relevance to consumers – and which adds value to a brand. This is one area in which the top UK brands have significant room for improvement.
Range of brands reflects daily life in Britain
A scroll through the Top 50 UK brands is like taking a stroll down the British high street. A great breadth of brands is represented, and even within individual categories there is huge variation. Car brands include the prestige brand Jaguar and more economical Mini; there’s the luxury of Burberry and more affordable fashion from Next and Asos, along with supermarkets ranging from the most price-focused to those offering a more premium service. Retailers, logistics suppliers, food brands and big names in entertainment round out a Top 50 ranking in which 18 categories are represented.
Brand health lags top global performers
Some of the most valuable UK brands are neglecting their brand health, and their financial performance and future prospects are being undermined as a result. Over a decade, the Top 10 UK brands – tracked as part of the annual BrandZ Top 100 Global Brands ranking – have grown at less than one-third of the pace of the Top 10 Global brands. When we look at the BrandZ measure of brand health, we find that these most valuable UK brands are only marginally healthier than the average of all brands; very few tick all the boxes on the factors that contribute to brand vitality, and quite a few are decidedly frail. Scale has sustained these brands in the past, but now they are vulnerable. This is important because there are many smaller but potentially highly disruptive brands in the UK poised to exploit any weaknesses.
Trust and business success go together
Some of the most trusted brands in the UK are also the most highly recommended by consumers, and this matters enormously given the high usage of social media. Trust often takes many years to earn, and some of the most trusted UK brands have indeed been around for decades – names like British Airways, Cadbury, the BBC and Royal Mail. But trust is about more than being old, and the high levels of trust seen in relative newcomer MoneySupermarket.com, which is 22 percent more trusted than the average brand, shows new brands can gain trust, too. These trusted brands feature among the most likely brands to be loved and recommended, factors that also correlate with brand value.
TOP 5 LEARNINGS FOR MARKETERS
1 Even big brands need to be nurtured
Businesses that nurture the power of their brands can punch above their financial weight, improve their resilience, and create the best conditions in which to grow future sales. This is particularly important for UK brands now, as the country works through at-times turbulent conditions and seeks to redefine its position as a leading exporter. Among the Top 50 UK most valuable brands, the brands with the highest Brand Contribution – a key ingredient in brand value – come from a wide range of categories. They demonstrate that from luxury goods to laundry detergent, the right investment and focus can build a strong brand in any category.
2 Make branding a priority and reap rewards
Analysis of the BrandZ ranking shows that the healthiest and strongest brands are those that can best generate volume sales, justify a premium, and grow their value at a pace that outperforms brands in general – factors that all add to their bottom line. Over 10 years of Global BrandZ rankings, it has become clear that the share price of valuable brands is better insulated when external factors buffet the market, and these brands make a faster return to growth when conditions improve. Over time, their returns to shareholders have averaged four times the returns of a global market tracker.
3 Fame alone will not bring success
Being well-known is a key ingredient of brand growth, but there is more to building a healthy brand than having the biggest voice. Brands need to have a purpose – something they stand for that goes beyond “doing what it says on the tin”, and something that is about more than making money. They have to constantly challenge themselves to stay relevant in a fast-changing consumer market, and deliver a brand experience that delights consumers not just in the moment of consumption but also in the lead-up to – and long after – a transaction is made. Strong communications can help make up for deficiencies in other areas, but it cannot work alone.
4 Emotional connections can deliver future growth
The brands that are meaningful, those that make a positive difference to people’s lives, and that are seen as different to other brands in their category are those that are more healthy and tend to be worth more. Meaningful difference is conveyed through products and services but also through powerful and memorable communications. Advertising by meaningfully different brands doesn’t just reach the target audience – it moves them.
5 Innovation is the key to consumers’ hearts
Innovation is one of the key components of brand health, and is closely linked to love. Love is important not just because it’s nice to be loved, but because it helps sustain sales and brand value during the periods between innovations. Yet the brands that are seen as the most innovative by UK consumers are largely outside the BrandZ Top 50. This should serve as a sign of a healthy competitive market in which progress is in the pipeline – but also a word of warning to any brand that thinks a long history guarantees future longevity.