We are pleased to renew our partnership with Brand Africa in publishing this unique ranking of all brands active in Africa today. The first annual listing appeared last year in the November 2013 issue.The Report was compiled by Thebe Ikalafeng, founder, Brand Africa, Oliver Schmitz, managing director, Brand Finance Africa, and Rupert Kemp, valuation director, Brand Finance Africa.
The listing consists of several elements:
1) The 100 Most-Admired Brands in Africa. The aim was to find out from consumers in the field which brands they liked the most and to rank them.
2) The Most-Valuable Brands: Employing a complex system, Brand Africa and its partners have worked out the current market value of the brands themselves.
While the listings themselves give us a fascinating idea of how brands are perceived in the African market and what sort of value they have built up, the data is invaluable to the companies themselves, as they present a true image of what consumers think, and also to investors. The tables show that local (and increasingly international) African brands can more than hold their own against the might of the large global multinationals, even if the resources they can deploy in brand building are a fraction of those available to their global rivals.
Economic growth in Africa, which is expected to register 4.7% this year and 5% in 2015, a faster pace of urbanisation and rapidly expanding middle class, have placed Africa among the new attractive retail and consumer markets in the world. Consumer spending is projected to reach $1 trillion by 2020.
The key trends underpinning Africa’s consumer growth includes an expanding pool of the working age population, the rapid growth of cities, changing consumer behaviour, greater mobility, improving business and trade environments and rising incomes.
According to New World Wealth, the rate of increase in millionaires and multimillionaires in Africa is among the highest in the world.
South Africa alone has broken the world record: the number of millionaires has grown by 106% over the last decade and multimillionaires by 102%. This easily beats the global average of 58% for millionaires and 71% for multimillionaires.
Africa is home to about 100,000 dollar millionaires – an increase of 7.4% over last year. The number of Nigerian millionaires is expected to grow by 47% over the next four years.
With Africans becoming wealthier, and travel and technology virtually obliterating borders and barriers, Africans have been exposed to, and are demanding, growing options in local and international brands.
Admired and Valuable
This is the second time that African Business is teaming up with Brand Africa to publish tables that rank all the brands active on the continent. For the purposes of this evaluation, Brand Africa has divided brands into African brands (African in origin) and non-African brands (international brands operative in Africa) which are more likely than not to be major global brands.
There are two major tables in this report. Using the table of 100 Most-Admired Brands in Africa, we then established the brand value of these brands and created a separate ranking: The Most-Valuable Brands. The value was established by crunching a number of metrics including financial statements. There were 15 private companies whose financials were not available and where the brand value, therefore, could not be established.
The tables that we published last year showed that, contrary to expectations, top African brands not only held their own against the multinational giants, they outperformed them in the Most-Admired brands category. However, non-African brands dominated the listings.
This time around, non-African brands have continued their numerical domination, increasing their presence from 73% on last year’s list to 80% this year, compared to a decline of 7% for African brands.