Public Bank tops third Interbrand study of Malaysia’s Most Valuable Brands

Tuesday, 24 November 2009 01:33

KUALA LUMPUR, 20 Nov 2009: Public Bank has emerged as the country’s most valuable brand in the third annual ranking of Malaysia’s Most Valuable Brands - a league table that values the Top 30 consumer-facing Malaysian brands. These brands were honoured at an awards night presided by Minister in the Prime Minister’s Department, Tan Sri Nor Mohamed Yakcop.

The valuation study was commissioned by the Association of Accredited Advertising Agents Malaysia (4As) and The Edge, and was conducted by Interbrand, who pioneered and globally dominates the established methodology of brand valuation.

Public Bank, valued at RM6.593 billion, is one of the five brands in the ranking that are worth at least USD1 billion. The other US billion dollar brands are Maybank (RM5.374 billion), CIMB (RM5.245 billion), Celcom (RM3.993 billion) and Parkson (RM3.740 billion).  

To qualify for the study, the brand must be publicly-listed or owned by a company that is listed, whether on Bursa Malaysia or other stock exchanges. The brand has to originate in Malaysia or be owned by a listed company headquartered in Malaysia for at least 10 years. The brand also has to be consumer-facing.

The listing requirement is to ensure the validity of the financial information used, as this study is based on publicly available data.

The results of the study show that two-thirds of the companies in the Top 30 this year saw a drop in brand value from the previous year. Some were harder hit than others, with three brands falling off the list.

However, some brands have continued to experience growth despite the global economic crisis through strong financial management and continued emphasis on brand building. Government measures to stimulate domestic spending were also credited for helping to mitigate the downturn’s impact on business as consumers tightened their belts.

Nonetheless, consumer spending in Malaysia has remained largely resilient despite the difficult economic climate, with many people taking advantage of the value deals offered by companies such as AirAsia, Padini and Giant.

Sime Darby has done exceedingly well with an 82.6% increase, entering the top 10 for the first time. Its merger with Golden Hope Plantations and Kumpulan Guthrie has resulted in Sime Darby strengthening its offerings, enabling the company to demonstrate greater resilience.

The telecommunications sector has also done particularly well. Celcom and DiGi have targeted their offerings to specific target segments, providing products and services that meet the needs of their customers.

This year’s study sees the entry of two new brands into the Top 30 list: Alliance Bank and Premier. It also sees the return of another brand, Bonia.

However, three brands have fallen off the rankings this year – Proton, MAA and Ogawa.

The results should be a call to action for brands in Malaysia to understand that great brands don’t just happen, they need constant management if they are to maximise their value.

“I feel that we have accomplished what we set out to do three years ago of building a great brand-savvy culture in Malaysia. Companies are starting to see how closely brand value ties to their financials. The economic downturn has only served to drive home the importance of branding among companies as they took a more proactive stance instead of just paying lip service in 2007 when the study was launched,” said 4As President Datuk Vincent Lee.

Interbrand Asia-Pacific President Stuart Green said what the recessionary brand owner needs are effectiveness and efficiency. This however is far easier said than done. “Getting it right depends on many factors: industry, strategy, customer targets, and internal organisation and culture.”

“Well-positioned brands create value by driving demand. Smart brand owners manage this value by building strong brands that secure future revenue over time. The current environment is demanding even greater returns, forcing brand owners to quickly locate incremental value from the brands they manage. Unfortunately, even organisations with strong brands can struggle to capture incremental value for two big reasons:

1.    They lack a detailed understanding of brand mechanics – how their brands influence behaviour and customer choice. Greater insight into the mechanics of brand value creation is essential for improving effectiveness during periods of market instability.

2.    They are not equipped with the advanced management tools required to make complicated and pressurised capital allocation decisions. Improved decision-making can optimise brand efficiency by measuring return on brand investment, assessing risk, estimating outcomes, and clarifying the future scenarios with highest probability of success.”

Ho Kay Tat, Editor-in-Chief of business weekly The Edge, said the publication is happy to once again collaborate with the 4As to undertake this annual study. “We hope to see more Malaysian companies invest in building their brands and to do it consistently. Brand building is a business tool that, when used effectively, helps businesses grow.”

 

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