The world’s biggest companies are set to lose up to $1tn in brand value as a result of the Coronavirus outbreak, with the aviation sector being the most affected, according to the latest analysis by Brand Finance, the world’s leading independent brand valuation consultancy.
Brand Finance has assessed the impact of the COVID-19 outbreak based on the effect of the outbreak on enterprise value, as at 18 March 2020, compared to what it was on 1st January 2020. Based on this impact on enterprise value, Brand Finance estimated the likely impact on brand value for each sector. Each sector has been classified into 3 categories based on the severity of enterprise value loss observed for the sector in the period between 1st January 2020 and 18th March 2020.
David Haigh, CEO of Brand Finance, commented: “The COVID-19 pandemic and its impact on global markets is very real. Worldwide, brands across every sector are braced for the Coronavirus to massively affect their business activities, supply chain and revenues in a way that eclipses the 2003 SARS outbreak.
Now is the ideal moment for the UAE’s home-grown brands to remain ever present in their stakeholders’ minds, engage across digital channels, show resilience and adaptability in these unprecedented times.”
UAE’s top 25 brands
Brand Finance today released the first UAE 25 report on the UAE’s top 25 most valuable and strongest brands, of which 7 are banking brands. Following last year’s three-way merger between Union National Bank and Al Hilal Bank, ADCB is the fastest growing brand in the UAE, up 41% since last year to $2.7 billion.
A regional ranking of the Middle East’s top 50 most valuable brands has also been launched today by Brand Finance. The Middle East 50 2020 features 17 UAE brands representing a variety of sectors spanning oil and gas, telecoms, airlines, banks, and chemicals – a testament to the UAE’s standing as competitive global player.
“The harsh reality is that many UAE brands may not make their 2020 targets due to the unprecedented challenges of the Coronavirus outbreak,” Haigh said. “Having a strong brand is now more crucial than ever, as it is this resilience which will truly help to weather the storm and bounce back from this crisis.”
ADNOC breaks $11 billion barrier
Abu Dhabi National Oil Company (ADNOC) is the UAE’s most valuable brand, up 29% to $11.4 billion. The brand isalso the first UAE brand to achieve a brand valuation of more than $11 billion, a testament to the success of the Group’s ongoing transformation strategy. Since 1971, ADNOC has created thousands of jobs, driven the growth of a diverse knowledge-based economy, and played a key role in Abu Dhabi’s global emergence. ADNOC continues to look for new and innovative ways to maximise the value of its resources, pioneering those approaches and technologies that will ensure it is able to meet the demands of an ever-changing energy market, especially now amidst the steep slide in oil prices.
Etisalat maintains AAA Brand Rating and most valuable consumer brand
Emirati telecoms giant Etisalat is the most valuable consumer brand in the Middle East 50 2020 and UAE 25 2020 rankings for the third year in a row. With a brand value of $8.5 billion, Etisalat has demonstrated a consistent performance over the years. The brand is also the strongest telecoms brand in the Middle East and Africa – making it the sole brand in the region to maintain the prestigious AAA Brand Rating.
The brand’s growing role in fulfilling the UAE’s National Innovation Strategy and its dominant influence in shaping the region’s digital future are behind its continued success.
Etisalat’s footprint in 16 countries across Asia, Middle East, and Africa makes it home to an impressive portfolio of brands including Mobily, Ufone, Maroc Telecom, PTCL, and Etisalat Misr with a combined portfolio brand value of $11.0 billion.
Aviation worst impacted by Coronavirus
Assessed by Brand Finance as the hardest hit sector under COVID-19 are airlines, leisure and tourism, aviation, aerospace and defence. The global airline industry has said most carriers will run out of money within two months as a result of the closure of borders for arrivals as governments order shutdowns to contain the coronavirus outbreak. A large number of major airlines, including Emirates (up 9% to $6.8 billion at 1st January 2020) and Etihad (down 38% to $0.8 billion) have grounded most of their fleets as they now confront a crisis unlike anything ever seen before in the airline industry.
In addition to measuring overall brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, familiarity, loyalty, staff satisfaction, and corporate reputation. Alongside revenue forecasts, brand strength is a crucial driver of brand value.
According to these criteria, Emirates is the Middle East’s strongest brand with a Brand Strength Index (BSI) score of 86.2 out of 100 and it is this brand strength and positive sentiment amongst passengers which will help support the airline, as it significantly reduces passenger flights across the network in response to the Coronavirus pandemic.
Aldar & Gems Education: UAE brands to watch
Abu-Dhabi headquartered real estate brand Aldar ($409 million) is a notable entrant to this year’s ranking and tipped as a brand to monitor in the coming years. As the brand focuses its development strategy on key locations such as Yas Island and Saadiyat Island, it is also set to play a pivotal role in the Saadiyat Cultural District, which will be a focal part of Abu Dhabi’s pre-eminent regional business hub and a high-end cultural destination.
In the inaugural UAE 25 report, a fast-growing brand rising through the ranks, up 36% since last year to a brand value of $713 million is Gems Education. The brand operates over 45 schools across the UAE and is highly regarded for its commitment to e-learning and promoting digitalisation of the classroom environment. As schools across the UAE have shut their doors to help contain the spread of COVID-19, Gems Education has swiftly relocated to online offerings and is commended as a pioneering brand in the UAE.
