The latest research on the world’s fastest growing brands, by Millward Brown, a leading global research agency and brand consultant, established a cause-and-effect relationship between a brand’s ability to serve a higher purpose than its financial performance and size. In a similar fashion, MarkMonitor, a market research firm in Nigeria, has been steady on developing the list of top brands across different sectors.
The identified brands must have been able to top their peers in building the deepest relationships with customers as well as achieving a modest financial growth over the last few years. Fortunately, we uncovered that return on investment in the MarkMonitor’s selected fastest growing brands (companies) over the past five years are more attractive relative to ThisdayBGL 50 and the NSE index.
Our goal is to reveal which brands grew the most over the past five years, both in terms of customer bonding and shareholder value. To identify these brands, the leading question was: what were the common principles that sparked and sustained the growth of the companies we selected across the sectors? To arrive at the “MarkMonitor 10”, hundreds of brands in over 10 sectors where surveyed. We where guided mainly by the fundamental impacts the brands have on human values, society, environment and a revenue benchmark (internationally accepted standard) as listed below:
- Eliciting Joy: Activating experiences of happiness, wonder, and limitless possibility.
- Enabling Connection: Enhancing the ability of people to connect with each other and the nation in a meaningful ways.
- Inspiring Exploration: Helping people explore new horizons and new experiences.
- Evoking Pride: Giving people increased confidence, strength, security, and vitality.
- Impacting Society: Affecting society broadly, from challenging the status quo to redefining categories.
- Revenue consideration: Minimum annual revenue of $100 million (₦15 billion).
How We Arrived At The Fastest Growing Bands In Nigeria
To measure brand millage, we first look at earnings figure over the years. Then we separate the earnings attributable to tangible corporate networks, goods and services, supply chains, factories and other sources of revenue we can easily differentiate from intangibles. Next, we turned to our brand survey database. Over the last five years, we surveyed about 50,000 people in the major cities around the country. To identify people who are brand loyal, we separated those who were driven by price and location to enable us focus on the proportion of people who put the brand above price and beyond convenience. That gave us Brand Contribution. We then used the brand contribution to determine what portion of a company’s total earnings is driven by their brand.
Should Companies Measure Their Brand Value? Today, higher proportions of companies’ earnings are driven by intangible. One of the biggest components of intangible asset is the brand value. For instance, brand value accounted for about 30% of assets of the top 100 companies in the world in 2011.
Lessons From Other Jurisdictions
Tech Brands –History on their Side: The rise of technology and telecommunications is pretty amazing. Millward Brown started with two or three tech brands in the world top ten in 2006. Today they are four out of the top five. It points out how central telecom infrastructure has become to people's lives. Millions of people around the world are going straight to the mobile web because they could not afford a computer. In Africa, it's mobile banking –cashless economy in Kenya, Nigeria and Ghana. In the middle East, it’s social network powered revolution. Farmers now check the price of crops in local markets via the web in India to sell at the right time. The revolution is global.
IT/Telecoms taking over: One of the surprises in Information Technology is Baidu, the Chinese search engine company, which had the highest possible score in Brand Contribution and was the world's fastest growing brand value after Facebook in 2012.
Baidu is the Google of China, and they have done a great job of tailoring their search engine to the Chinese environment. For example, one of the things that Baidu is used for is downloading music. That is not something Google can do legally. But in China, it's a fair game. There is massive growth potential for Baidu within that market as more people get Internet access. There is a very small likelihood that a company knocks Baidu off its perch. However, the prospects of Biadu vying into the African markets, particularly Nigeria in the foreseeable future is slim.
Google's ended four-year run as the world's most valuable brand
Basically Google is in a horse race and a faster horse just blew past it. Apple has just had a phenomenonal performance with the iPad and other devices. But Google understands they have to get into new areas like Chrome and Android for phones.
Should brand be more important for some types of companies than others?
Absolutely, Coca Cola is at one part of the spectrum where brand is everything, and General Electric (GE) is at the other end, where products are sold based on technological specifications and bids. Brand contributes about 20% to GE's total earnings, whereas Coca Cola is nearer to 80%.
Brand Is Everything
For some companies, branding is everything. Coca Cola has massive brand distribution around the world and it's poised for strong growth in the BRICs (Brazil, Russia, India, and China, the vanguard of emerging markets). A strong brand also reduces business risk, since it's more likely to ride out a negative PR (Public Relations) story or a recession. Last year, Toyota fell because of recalls. This year it recovered faster than expected because it has very strong brand loyalty. Apple is the current world's most valuable brand largely due to the share of the company earnings, driven by brand identity.
According to Millward Brown Optimor brand strategists, the most successful brands were built on an ideal of improving lives in some way, irrespective of size and category. Millward’s analysis showed that the companies that centered their businesses on ideals had a growth rate triples that of competitors in their categories. On our part, we found that this ideal is both a source of inspiration externally among customers, as well as a compass for internal decision making. So whether it’s Red Bull which seeks to Uplift Mind and Body, or Pampers which is all about Caring for Happy Healthy Development of Babies, an ideal influences all facets of the business from Human Resources and Marketing to Research & Development and Finance.
Profile of the 2012 Fastest Growing Brands In Nigeria
Dana Group has established itself as an integral part of the Nigerian economy with an integrated commercial, industrial and service-orientated organisation, positioning itself as one of the leading business houses in Nigeria. The Group comprises of a diverse range of strategically positioned operating subsidiaries and associate companies with a manufacturing base. The firm’s operation is structured to give the Dana Group the flexibility and versatility to keep ahead of local competition while keeping pace with the ever-evolving global business environment. Its diverse business portfolio comprises of a solemn commitment and involvement in the following sectors of the economy: Aviation and Automobile, Chemical, Electronics, Instant Foods, Paper, Pharmaceutical, Plastics, and Steel.
Visafone was born out of strategic acquisition of three CDMA mobile network operators that had been in operation for up to eight years with 30,000 subscribers and coverage in different parts of the country. The Company was incorporated on 20th June, 2007 and received its Unified Access Service License as a telecoms operator from the Nigerian Communications Commission (NCC) on 1 August, 2007. Visafone established itself in the CDMA mobile subsector within its first Eleven months of operations. The company has since then been honored with many awards in the industry, besides crossing the one million subscriber mark in six months, amassing 2.5 million subscribers in 10 months and extending its coverage to 20 states and over 160 cities and towns in Nigeria.
Lately, Visafone attempted to acquire the telephony-components of Multilinks-Telkom with about 1.2 million subscribers. This bold action would have given Visafone 4.2 million subscribers in the subsector with just over six million active subscribers, making the company an active market segment leader. The CDMA mobile made an impressive entry into the Nigerian market and with the entry of Visafone, the subscriber base grew astronomically from just 380,000 in 2007 to more than six million by the end of 2008 –and from a mere 1% to 9.6% of all mobile lines in just one year.
Access Bank: In 2002, when the young management of Access Bank announced their plans to evolve from a fourth tier Nigerian bank to one of Nigeria’s top 3 banks by 2012, cynics and even the faithful had good reason to scoﬀ at their ambition. Management’s adoption of both organic and inorganic growth models especially with the recent absorption of Intercontinental Bank has however helped them attain their goal within the targeted period. The combined entity has bumped Access Bank into the league of top tier elite banks giving them a place amongst top lenders like First Bank, GTBank, Zenith Bank and UBA. The Bank’s Asset and Customer Deposit base sits atop the ₦1 trillion mark apiece like the rest of these lenders; though GTBank remains miles ahead of the industry in terms of returns on equity (ROE).
MINL Ltd: The Company is a wholly owned subsidiary of the Manaksia Group (formerly Hindusthan Seals Ltd) and was set up in 1996. MINL is a market leader in Roll-On-Pilfer-Proof (ROPP) caps and crown corks in Nigeria. It has also set up facilities for the manufacture of galvanised steel, metal colour coated sheets and coils and secondary specification aluminium alloys.
The Company has also set up its own continuous galvanizing line, aluminium alloy ingot plant, colour coating line and other non-ferrous value added products. In October 2006 MINL, through its wholly owned subsidiary, Jebba Paper Mills Limited, took over the assets of the Nigerian Paper Mills Limited. The company’s mission statement is: “Exploit the Group's core competence to profitably make world class metal products in Africa and exploit trading opportunities where Indian comparative advantage is identified”
Shoprite: The primary business of the Shoprite Group of Companies is food retailing to consumers of all income levels. The fulcrum of its business objective is to provide all communities in Africa with food and household items in a first-world shopping environment, at the lowest possible prices. At the same time the Group, inextricably linked to Africa, contributes to the nurturing of stable economies and the social upliftment of its people. The group now employs over 100, 000 people and of these, more than 11, 000 work in its stores outside South Africa.
Chi Nigeria Limited which has become a very successfull brand in Nigeria is a subsidiary of CORMART group. Cormart started its operations in Nigeria in 1981 trading in specialised industrial raw materials, chemicals and commodities. The group's other business interests covers manufacturing of fruit drinks and juice, secure water, poultry and fish farming, food production, processing and marketing of frozen foods, manufacturing of vegetable oil, cotton ginning, fish trawling and importation & distribution of industrial chemicals. The companies within the Group are: CHI Limited, Chi Pharmaceuticals, Master Marine Services Ltd, ORC Fishing and Food Processing Ltd, West African Cotton Co. Ltd, West African Cotton Development Co. Ltd, and Romson Oil Field Services Ltd. The Group is diversified with companies in four countries involved in manufacturing, agro-allied industries, import, export, distribution and strategic marketing in their areas of operation.
BUA Group of Companies has nurtured the organisation to a world-class conglomerate. BUA International Limited, the parent company and arrowhead, was set up over 20 years ago as a Private Limited Liability Company to undertake the importation and marketing of iron & steel, agricultural produce and industrial chemicals. Today, the areas of business interest span from manufacturing of sugar, cement, flour milling, oil milling, port concession, real estate development, oil & gas and shipping. The Group is poised to further strengthen its leadership position in other key sectors of the economy through the ongoing acquisition of various companies.
The BUA Group has built an immense presence in industrial and commercial activities in the real sector of the Nigerian economy. Apart from being adjudged the preferred bidder for the Delta Steel Company, Aladja, the Group also supervises the operations of the following subsidiaries:
•BUA Flour Mills Limited •Nigeria Oil Mills Limited (NOM) •BUA Oil Nigeria Limited •BUA Sugar Refineries Limited •BUA Cement •BUA Estates Development •BUA Ports & Terminals Limited •Damas Shipping Company Limited & •BUA Oil & Gas (International) Limited.
TATA: Established in 2006, TATA Africa Services (Nigeria) Limited has a strong presence in Nigeria with investments exceeding $10 million. The company was established in Lagos, Nigeria, as a subsidiary of TATA Africa Holdings (SA) (Pty) Limited, South Africa, and serves as the hub of TATA’s operations in Nigeria and the rest of West Africa.
TATA Nigeria is currently the fastest growing industrial auto supplier/seller in Nigeria with strong partnership innovations with customers and financiers. The company has a strong infrastructure base, excellent marketing capabilities, knowledge of the local market and needs, highly qualified manpower and a commitment to community development initiatives for improving the quality of life of the people.
Dangote: The Dangote Group is one of the most diversified business conglomerates in Africa with a hard-earned reputation for excellent business practices and products' quality with its operational headquarters in the bustling metropolis of Lagos, Nigeria in West Africa.
The Group's activities encompass:
- Cement –Manufacturing/Importing
- Sugar –Manufacturing & Refining
- Salt –Refining
- Flour & Semolina –Milling
- Pasta –Manufacturing
- Noodles –Manufacturing
- Poly Products –Manufacturing
- Logistics –Port Management and Haulage
- Real Estate
- Dangote Foundation
Since inception, the Group has experienced phenomenal growth on account of quality of its goods and services, its focus on cost leadership and efficiency of its human capital. Today, Dangote Group is a multi-billion naira company poised to reach new heights in every endeavour, competing with itself to better the past.
The Group's core business focus is to provide local, value added products and services that meet the basic needs of the populace. Through the construction and operation of large scale manufacturing facilities in Nigeria and across Africa, the Group is focused on building local manufacturing capacity to generate employment and provide goods for the people.
TAK Agro & Chemicals is a subsidiary of TAK Group that has been in the food and Agro Allied business for the past ten years. TAK Agro emerged as a brand in Nigeria in 2004 with a full focus on its core business of local fertilizer manufacturing and blending, as well as sales to private sector open markets. Through the visionary leadership of its key promoter, Mr. Thomas Etuh, the company has transformed over the years into a leader and major stakeholder in the Federal Government of Nigeria’s crusade for Food Security through its dominance in the Agricultural Farm Input Sector of the Nigerian Economy.
Other companies within the group are; TAK Agro & Chemicals, TAK Tractors Ltd, TAK Logistics Ltd and TAK Port Pack Ltd.