And adds stability in disruptive markets
Brand Contribution is the BrandZ™ metric that assesses the extent to which brand alone, independent of financial or market factors, drives purchasing volume and enables a brand to command a price premium. Brands that score well in Brand Contribution are viewed positively by consumers.
High Brand Contribution can take time to build, but it is a sustaining force. Of this year’s Brand Contribution Top 15, all but two appeared in the Brand Contribution ranking a year ago. The newcomers are Stella Artois, a global premium beer owned by AB InBev, and Tencent, the Chinese internet portal that is No.1 in the BrandZ™ Top 100 Most Valuable Chinese Brands.
Six of the Brand Contribution Top 15 are beer brands and four are luxury brands. These two categories would seem quite different—beer focused more on a mass market and luxury dependent on exclusivity. However, brands in both categories rely heavily on the consumer’s perception of value. And brands in both categories invest heavily in brand building and brand communication.
The return on investment can be significant. The soft drinks category has been under pressure for years because of consumer health concerns. Consumption of carbonated soft drinks in the US declined for the 12th consecutive year. The soft drinks category remained unchanged in value. Yet Coca-Cola remains the world’s second-highest scorer in Brand Contribution, after Aguila, a local Colombian beer.
Similar circumstances surround the third-highest Brand Contribution scorer, Pampers. In some of the brand’s global markets, China, for example, e-commerce is turning diapers into a commoditized, price-driven category. The investment Pampers makes in differentiating the brand as a source of knowledge and consultation for young parents broadens its appeal, creates an emotional connection with consumers, and helps produce its high Brand Contribution score.
Personal care brand Estée Lauder also establishes a consultative relationship with its customers, which helps sustain it against smaller disruptor brands. Baidu and Tencent, the two Chinese technology brands in the Brand Contribution Top 15, illustrate a correlation between high Brand Contribution and the ability to become important in the life of the customer, in these cases being constantly available to fulfill needs for information, shopping, and payment.
Brand Contribution is expressed on a scale of one to five, five being highest. (For complete details, please see the BrandZ™ Valuation Methodology)