Billabong was the biggest loser in terms of Australian brands last year, while the ANZ bank added more than $2 billion to its brand's value.
Brand Finance’s latest Australian study suggests that retail brands are struggling. This is evident in the loss of brand value of Billabong, David Jones, Harvey Norman, Westfield, and Myers. The strong dollar and propagation of internet shopping has meant that savvy consumers are tightening their purse strings and looking online for cheap imports.
Billabong’s recent difficulties have been well publicised. Unsurprisingly it has lost $179 million in brand value dropping 24 places since 2012 to rank at No.43. However the brand remains an important asset in the business, the value of which fell by a relatively larger amount over the same period.
Commenting on the results Xander Bird, MD of Brand Finance Australia, said “The historic strength of the Billabong brand has bought the company time to turn itself around. However that time is fast running out. Unless perceptions can be changed, Billabong will remain a brand of the past, rather than being associated with the future.”
Despite the performance of other retail brands, Woolworths and Coles have done well in this year’s study. The products they offer are not at risk from imports and online substitution in the way that other retailers are.
ANZ is this year’s standout performer and has assisted the Australian banking sector’s growth to outperform the global banking sector. Following reported profits of $5.7 billion in the year to 30 September, a 6% year-on-year increase, brand value has also increased 66%. An impressive $2.198 billion of brand value growth takes its total to $5.531 billion and No.5 in the Australia 100. With the Australian Banking sector achieving 32% growth overall, Australian Banks have displayed their strength and stability since the GFC, this is in contrast to the slow recovery of banks in emerging markets which averaged just 15%.
It is perhaps unsurprising that financial service brands have done well, as consumers are spending more cautiously and saving more than they have for some time. The cost of living in Australia is high relative to similar countries which are dampening spending. With the strong AUS dollar this has given Australian banks an opportunity for growth.
Telecoms brands continue to grow in value as our mobile devices become essential rather than discretionary spending. Telstra comes in at 3rd place having increased their brand value by $618 million to reach $5.747 billion while rivals Optus are 10th with a value of $2.821 billion.
The commodity sector is still growing with the huge demand from China. Even though the Chinese economy is expected to cool in coming years the demand for Australia’s natural resources is remains high. BHP Billiton and Rio Tinto are rivals within the top 10 with brand value of $6.136 and $3.931billion respectively.
The good news is that the league table shows that the economy is rather well balanced and not dependent on one particular sector.