Professional Documents
Culture Documents
50
2017
The annual report on the most valuable Swedish brands
May 2017
Foreword. Contents
steady downward spiral of poor communication, Foreword 2
wasted resources and a negative impact on the
bottom line. Definitions 4
Methodology 6
Brand Finance bridges the gap between the
marketing and financial worlds. Our teams have Executive Summary 8
experience across a wide range of disciplines from
market research and visual identity to tax and Full Table (USDm) 12
accounting. We understand the importance of
design, advertising and marketing, but we also Full Table (SEKm) 13
believe that the ultimate and overriding purpose of
Understand Your Brand’s Value 14
brands is to make money. That is why we connect
brands to the bottom line. How We Can Help 16
A brand should be viewed in the context of the The brand values contained in our league tables In the very broadest sense, a brand is the focus Brand Strength is the part of our analysis most
business in which it operates. For this reason are those of the potentially transferable brand for all the expectations and opinions held by directly and easily influenced by those
Brand Finance always conducts a Branded asset only, but for marketers and managers customers, staff and other stakeholders about an responsible for marketing and brand
Business Valuation as part of any brand valuation. alike, an assessment of overall brand organisation and its products and services. management. In order to determine the strength
Where a company has a purely mono-branded contribution to a business provides powerful However, when looking at brands as business of a brand we have developed the Brand
architecture, the business value is the same as insights to help optimise performance. assets that can be bought, sold and licensed, a Strength Index (BSI). We analyse marketing
the overall company value or ‘enterprise value’. more technical definition is required. investment, brand equity (the goodwill
Brand Contribution represents the overall uplift accumulated with customers, staff and other
In the more usual situation where a company in shareholder value that the business derives Brand Finance helped to craft the internationally stakeholders) and finally the impact of those on
owns multiple brands, business value refers to from owning the brand rather than operating a recognised standard on Brand Valuation, ISO business performance.
the value of the assets and revenue stream of the generic brand. 10668. That defines a brand as “a marketing-
business line attached to that brand specifically. related intangible asset including, but not limited Following this analysis, each brand is assigned
We evaluate the full brand value chain in order to Brands affect a variety of stakeholders, not just to, names, terms, signs, symbols, logos and a BSI score out of 100, which is fed into the
understand the links between marketing customers but also staff, strategic partners, designs, or a combination of these, intended to brand value calculation. Based on the score,
investment, brand tracking data, stakeholder regulators, investors and more, having a identify goods, services or entities, or a each brand in the league table is assigned a
behaviour and business value to maximise the significant impact on financial value beyond combination of these, creating distinctive images rating between AAA+ and D in a format similar
returns business owners can obtain from their what can be bought or sold in a transaction. and associations in the minds of stakeholders, to a credit rating. AAA+ brands are exceptionally
brands. thereby generating economic benefits/value”. strong and well managed while a failing brand
would be assigned a D grade.
4. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 5.
Methodology
League Table Valuation Methodology Brand Finance Typical Project Approach
Brand Finance calculates the values of the 2 Determine the royalty rate range for the respective
brands in its league tables using the ‘Royalty brand sectors. This is done by reviewing comparable
Relief approach’. This approach involves licensing agreements sourced from Brand Finance’s
estimating the likely future sales that are extensive database of license agreements and other
attributable to a brand and calculating a royalty online databases.
Brand Equity Stakeholder Brand
rate that would be charged for the use of the 3 Calculate royalty rate. The brand strength score is Inputs Performance Contribution
Value Drivers Behaviour
brand, i.e. what the owner would have to pay for applied to the royalty rate range to arrive at a royalty
the use of the brand—assuming it were not rate. For example, if the royalty rate range in a brand’s
already owned. sector is 0-5% and a brand has a brand strength
score of 80 out of 100, then an appropriate royalty 1 2 3 4
The steps in this process are as follows:
rate for the use of this brand in the given sector will Brand Audit Trial & Preference Acquisition & Valuation Modelling
be 4%. Retention
1 Calculate brand strength on a scale of 0 to 100 based
4 Determine brand specific revenues estimating a
on a number of attributes such as emotional Audit the impact Run analytics to Link stakeholder Model the impact of behaviour on
proportion of parent company revenues attributable
connection, financial performance and sustainability, of brand understand how behaviour with core financial performance and
to a specific brand.
among others. This score is known as the Brand management and perceptions link to key financial isolating the value of the brand
5 Determine forecast brand specific revenues using a investment on behaviour value drivers contribution
Strength Index, and is calculated using brand data
function of historic revenues, equity analyst forecasts brand equity
from the BrandAsset® Valuator database, the world’s
and economic growth rates.
largest database of brands, which measures brand
6 Apply the royalty rate to the forecast revenues to
equity, consideration and emotional imagery
derive brand revenues.
attributes to assess brand personality in a category
7 Brand revenues are discounted post tax to a net
agnostic manner.
present value which equals the brand value.
Brand strength Brand Brand revenues Brand value
index ‘Royalty rate’ How We Help to Maximise Value
(BSI)
Sweden 1 6
Rank 2017: 1 2016: 1 Rank 2017: 6 2016: 6
BV 2017: $24.1 bn BV 2017: $3.6 bn
+42% -11%
BV 2016: $17.0 bn BV 2016: $4.0 bn
Brand Rating: AA Brand Rating: AA+
2 7
50
Rank 2017: 2 2016: 2 Rank 2017: 7 2016: 9
BV 2017: $19.2 bn BV 2017: $2.9 bn
+24% +19%
BV 2016: $15.5 bn BV 2016: $2.4 bn
Brand Rating: AAA Brand Rating: AAA-
IKEA tops the Brand Finance Sweden 50 league easily as possible. The light-hearted initiative saw domestic lifestyle brands globally, IKEA has not year. It has dropped from US$9.5 billion to a 10-
table with a brand value of over US$24 billion the official names of IKEA products replaced with shied away from the challenge, surveying its year low of just over US$5 billion. Despite this
after impressive growth of 42% year on year. The common Google searches such as ‘My Partner customers’ attitudes to the idea of embedding decline, the brand remains a key asset for the
strength of IKEA’s brand is built on its associations Snores’ and ‘How To Get Over Someone’. The smart systems in furniture to help manage homes. business constituting 29% of the total Enterprise
with much of what is best about the Swedish page featured a catalogue of the brand’s products Value. Restructuring could help to put Ericsson
national ‘brand’, namely; style, simplicity, with their original names replaced by the internet H&M is second, with a brad value of over US$19 back on a more stable financial footing, so a
functionality and a lack of pretention. Though searches, in this way offering quick solutions to billion, following 24% growth. The clothing giant is stabilization of brand value in 2018 could be
customers grumble about the difficulty of everyone who searched for an answer to their also the country’s most powerful brand with a expected. Prudently, new CEO Börje Ekholm has
assembling flat pack furniture, IKEA’s striking but dilemma online. Campaigns with more of a social Brand Strength Index (BSI) score of 86. Emerging promised not cut the R&D budget as part of the
tasteful designs, reliability and extremely purpose have been employed too, including the online competitors are pushing the H&M Group to restructuring process. Brand investment of this
competitive pricing have assured its position. ‘Where Life Happens’ series, intended to provoke look for new ways to attract customers. One kind is essential even at difficult times to ensure
This year’s rapid brand value growth has been discussion on family issues, such as ageing, solution has been to launch new brands such as long term growth.
supported by a 20% increase in profits last year adolescence, divorce, and adoption. COS, Monki, Weekday, or the recently announced
combined with continuing creative and effective Arket. Although at the corporate level this may Bank brands continue to feature prominently in
communications. IKEA is looking to the longer term too. Brand increase revenue and customer acquisition, the the Brand Finance Sweden 50 ranking with four in
extension is one route to growth; a chain of IKEA decision not to deploy the core brand and focus the top 10; Nordea (3th), Swedbank (7th), Svenska
Advertising and marketing campaigns range restaurants has been mooted to capitalize on the attention and resources elsewhere could reduce Handelsbanken (8th), and SEB (9th). However,
from the whimsical, to the practical, and to the affection and demand for the brand’s in store its strength and value in future. recently unveiled government plans to increase
meaningful. The ‘IKEA Retail Therapy’ website food offerings such as its famous meatballs. The resolution fees (to aid struggling financial firms)
was ostensibly created to enable customers to ‘internet of things’ is claimed to herald a revolution Ericsson has seen its financial problems reflected could drive this number down if brands such as
find solutions to their everyday problems as in domestic life. As one of the most iconic in the loss of almost half of its brand value in a Nordea make good threats to move out of Sweden.
8. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 9.
Executive Summary
Brand Value Over Time The 10 Most Powerful Brands Brand Value Change (USDm)
These are the most powerful Swedish brands, whose rating
25
is based on Brand Finance’s Brand Strength Index (BSI). IKEA 7,110
TeliaSonera
H&M 3,667
BSI Score Swedbank 470
86.4
20 Atlas Copco 405
Ericsson
Scania 252
Securitas 146
Peab 114
BSI Score
Brand Value (USDBn)
Nordea
79.9
NCC 99
15
SCA 90
Scandinavian Airlines 71
H&M -180 Electrolux
BSI Score
79.1
-196 Spotify
10
-213 Vattenfall
IKEA -214 Tele2
-272 Getinge
BSI Score -288 SEB
77.5
5
-318 Svenska Handelsbanken
-425 Volvo
-855 Telia Company
TeliaSonera
BSI Score -4,398 Ericsson
77.2
0
-5500.000000
-3571.428571
-1642.857143
285.714286
2214.285714
4142.857143
6071.428571
8000.000000
2011 2012 2013 2014 2015 2016 2017
75.2
IKEA 7,110 Hemfosa Fasti 58%
H&M 3,667 IKEA 42%
Swedbank 470 Com Hem 34%
Colour Sector Brand Value % of total Atlas Copco 405 SSAB 30%
(USD Billion)
Scania BSI Score 252 Atlas Copco 26%
74.4
Retail 26.0 26.8%
Securitas 146 Cloetta 25%
Apparel 19.2 19.8% Peab 114 H&M 24%
NCC 99 Swedbank 19%
Retail
Banks 14.3 14.8%
26% SCA BSI Score 90 Inwido 19%
73.7
Engineering & Scandinavian Airlines 71 16%
9.4 9.7% Scandinavian Airlines
Construction
Technology -180 Electrolux -13% Spotify
8.4% Technology 8.4 8.6%
-196 Spotify -16% Telia Company
TeliaSonera
Automobiles 5.8 5.9% -213 BSI Score
Vattenfall -16% Electrolux
73.1
-214 Tele2 -18% Tele2
Engineering & Telecoms 5.6 5.8%
Construction Apparel -272 Getinge -25% Lotus
9.4% 19.2% Pro Services - 2.0 2.1% -288 SEB -26% Seco Tools
Commercial
-318 Svenska Handelsbanken -29% Meda
Banks Others 6.3 28.0%
BSI Score
72.7
14.3% -425 Volvo -30% Libero
Total 96.9 100% -855 TeliaSonera -33% Getinge
-4,398 Ericsson -47% Ericsson
-5500.000000
-3571.428571
-1642.857143
285.714286
2214.285714
4142.857143
6071.428571
8000.000000 -55.0-40.5-26.0-11.53.0 17.532.046.561.075.590.0
10. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 11.
Brand Finance Brand Finance
Sweden 50 (USDm) Sweden 50 (SEKm)
Top 50 most valuable Swedish brands 1 - 50. Top 50 most valuable Swedish brands 1 - 50.
Rank Rank Brand Value Brand Value Brand Brand Rank Rank Brand Value Brand Value Brand Brand
Brand name Sector % Brand name Sector %
2017 2016 (USDm) (USDm) rating rating 2017 2016 (SEKm) (SEKm) rating rating
change change
2017 2016 2017 2016 2017 2016 2017 2016
1 1 IKEA Retail 24,119 42% 17,009 AA AA 1 1 IKEA Retail 206,760 43% 144,439 AA AA
2 2 H&M Apparel 19,177 24% 15,510 AAA AA+ 2 2 H&M Apparel 164,395 25% 131,709 AAA AA+
3 4 Nordea Banks 5,600 1% 5,572 AA AA 3 4 Nordea Banks 48,004 1% 47,316 AA AA
4 3 Ericsson Technology 5,047 -47% 9,445 AA AA+ 4 3 Ericsson Technology 43,266 -46% 80,208 AA AA+
5 5 Telia Company Telecoms 4,614 -16% 5,469 AA AA+ 5 5 TeliaSonera Telecoms 39,551 -15% 46,444 AA AA+
6 6 Volvo Automobiles 3,572 -11% 3,997 AA+ AA+ 6 6 Volvo Automobiles 30,618 -10% 33,942 AA+ AA+
7 9 Swedbank Banks 2,910 19% 2,440 AAA- AA 7 9 Swedbank Banks 24,944 20% 20,720 AAA- AA
8 7 Svenska Handelsbanken Banks 2,893 -10% 3,211 AA+ AA+ 8 7 Svenska Handelsbanken Banks 24,803 -9% 27,265 AA+ AA+
9 8 SEB Banks 2,480 -10% 2,768 AA+ AA+ 9 8 SEB Banks 21,263 -10% 23,504 AA+ AA+
10 10 Skanska Engineering & Construction 2,339 0% 2,341 A+ AA- 10 10 Skanska Engineering & Construction 20,055 1% 19,876 A+ AA-
11 11 Scania 11 11 Scania
12 15 Atlas Copco 12 15 Atlas Copco
13 12 Securitas 13 12 Securitas
14 14 Sandvik 14 14 Sandvik
15 13 Vattenfall 15 13 Vattenfall
16 18 SCA 16 18 SCA
17 17 SKF 17 17 SKF
18 16 Spotify 18 16 Spotify
19 22 NCC 19 22 NCC
20 21 ICA 20 21 ICA
21 19 Tele2 21 19 Tele2
22 20 Electrolux 22 20 Electrolux
23 24 Peab 23 24 Peab
24 23 Getinge 24 23 Getinge
25 27 SAAB 25 27 SAAB
26 28 Scandinavian Airlines 26 28 Scandinavian Airlines
27 31 Willys 27 31 Willys
28 30 Boliden 28 30 Boliden
29 New Holmen 29 New Holmen
30 29 Libero 30 29 Libero
31 36 Com Hem 31 36 Com Hem
32 33 AAK 32 33 AAK
33 38 SSAB 33 38 SSAB
34 35 Axfood N�rlivs 34 35 Axfood N�rlivs
35 34 Thule 35 34 Thule
36 32 Lotus 36 32 Lotus
37 41 Lansforsakringar Bank 37 41 Lansforsakringar Bank
38 37 Dustin 38 37 Dustin
39 43 Pandox AB 39 43 Pandox AB
40 49 Hemfosa Fasti 40 49 Hemfosa Fasti
41 New Intrum Justitia 41 New Intrum Justitia
42 New Fingerprints 42 New Fingerprints
43 45 Cloetta 43 45 Cloetta
44 New Eltel 44 New Eltel
45 40 Seco Tools 45 40 Seco Tools
46 New Collector 46 New Collector
47 New Coor 47 New Coor
48 42 Meda 48 42 Meda
49 50 Inwido 49 50 Inwido
50 New Läkerol 50 New Läkerol
12. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 13.
Understand Your Brand’s Value
Drivers of Change Brand Strength Index 2016
Brand Value Dashboard Three key areas impact Brand Value (EURm)
An ideal balanced scorecard of fundamental brand related measures Brand Valuation Assumptions
Underlying economic assumptions used in valuation
Effective BSI
Weighting Attributes
18 131
AA+
6.25% Product: R&D expenditure,
Widely recognised factors deployed by
$
Brand Capital expenditure
[XXX] Marketers to create brand loyalty and Strong brand
Brand Value (EUR) Brand Value (EUR) Enterprise Value (EUR) Investment 6.25% Place: Brand value (EURm) Brand
25% Website Ranking
market share. We therefore benchmark
Investment
€650m €729m
=
Inputs
€9,399m 78/100 729 729
%
650 6.25% People: Number of Employees,
X
616 616
brands against relevant input measures by
$650
Brand
Employee Growth
25% Equity
A Brand Value Report provides a complete + Internal understanding of brand Royalty Rates Trademark Audit
breakdown of the assumptions, data + Brand value tracking
sources and calculations used to arrive at + Competitor benchmarking Analysis of competitor royalty rates, industry Analysis of the current level of protection for the
your brand’s value. + Historical brand value royalty rate ranges and margin analysis used to brands word marks and trademark iconography
Each report includes expert recommendations determine brand specific royalty rate. highlighting areas where the marks are in need
for growing brand value to drive business of protection.
performance and offers a cost-effective way to Brand Strength Index + Transfer pricing
gaining a better understanding of your position + Licensing/ franchising negotiation + Highlight unprotected marks
against competitors. A breakdown of how the brand performed on + International licensing + Spot potential infringement
various metrics of brand strength, benchmarked + Competitor benchmarking + Trademark registration strategy
A full report includes the following sections against competitor brands in a balanced
which can also be purchased individually. scorecard framework. For more information regarding our Brand Value
Cost of Capital Reports, please contact:
+ Brand strength tracking
Brand Valuation Summary + Brand strength analysis A breakdown of the cost of capital calculation, Alex Haigh
+ Management KPI’s including risk free rates, brand debt risk Director of League Tables, Brand Finance
Overview of the brand valuation including + Competitor benchmarking premiums and the cost of equity through CAPM.
executive summary, explanation of changes in a.haigh@brandfinance.com
brand value and historic and peer group + Independent view of cost of capital for internal
comparisons. valuations and project appraisal exercises +44 (0)20 7389 9400
14. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 15.
How we can help Contact details
1. Valuation: What are my intangible assets
worth?
2. Analytics: How can I improve marketing
effectiveness?
Contact us Our offices
Valuations may be conducted for technical purposes Analytical services help to uncover drivers of demand For brand value report
and to set a baseline against which potential strategic and insights. Identifying the factors which drive
enquiries, please contact:
brand scenarios can be evaluated. 2. A consumer behaviour allow an understanding
IO N Alex Haigh
NA of how brands create bottom-line impact.
AT Director of League Tables
LY
AL Brand Finance
T
1. V
a.haigh@brandfinance.com
ICS
• Branded Business Valuation • Trademark Valuation • Market Research Analytics • Brand Audits
• Intangible Asset Valuation • Brand Contribution
Brand & • Brand Scorecard Tracking • Return on Marketing Investment
For media enquiries,
Business Value
ION
3. S
T
TR
Director Brand Finance
S
16. Brand Finance Sweden 50 May 2017 Brand Finance Sweden 50 May 2017 17.
Contact us.
The World’s Leading Independent Branded Business Valuation and Strategy Consultancy
T: +44 (0)20 7389 9400
E: enquiries@brandfinance.com
www.brandfinance.com