Against All Odds

As the global and local economic environments take a
beating the world of brands is challenged to calibrate

What goes up must come down, as we know – but the global economy in particular has in recent years seen more of the bottom than the top, with another recession looming less than four years post the near-depression of 2008/09. On home soil too, there are signs that economic conditions may soften. What this means for brand guardians and the products and services they deliver is that there is now a squeeze on consumer spending, which naturally has a direct and telling effect on sales and performance.

Brand Finance Lanka’s Ruchi Gune­wardene says that “this will drive consumers to look for more value from their brands in their everyday purchases. Brands with high equity will be at an advantage, as consumers are likely to turn to them before considering alternative brands. Redefining them so as to provide value will be a key consideration in the year ahead…”

The local brands landscape continues to be dominated by the giants of banking. And not for the first time, they are led by two state-owned entities. A sign of the times perhaps is the fact that the brand values of both BOC and People’s Bank declined this year. In contrast however, the two torchbearers of Sri Lanka’s telecommunications industry enjoyed brand-value growth because the telco price war of old has abated and the regulatory environment has improved. The values attributed by Brand Finance to Sri Lanka’s 100 most valuable brands range from 32 million rupees to BOC’s Rs. 15.2 billion (which is a little over a fifth of its annual income), with the prior-year comparisons being Rs. 15 million and 16.7 billion rupees.

On a global scale, Apple – which helmed the 2012 valuations – registered a brand worth of over 70 billion dollars. To put things in perspective, this isn’t much higher than Sri Lanka’s GDP. The global brands hierarchy is also featured in the Brands Annual this year.

The good news is that this special edition continues to attract the attention of a growing readership, with bookstores and supermarkets all but selling out for the third consecutive year… not only because the valuations and rankings are unique in this country, but perhaps in view of a record number of brand guardians accepting our invitation to be profiled in the Brands Annual. That record has been broken this year, which is why the pages that follow make for a bumper issue.

– LMD/Media Services