The third annual 'BrandZ Top 50 Most Valuable Indian Brands' rankings study by WPP and Kantar Millward Brown has just been released. According to the report, the total value of India's most valuable brands has risen by 30 per cent over the last three years, with the Top 50 brands now worth $90.5 billion; HDFC bank stands firmly at No.1 for the third consecutive year with a brand value of $14.4 billion following a 15 per cent growth over the last one year.
The report adds that the past year was a year of consolidation for the BrandZ India Top 50, primarily due to a decline in brand value of state-owned banks, bringing the total brand value of Top 50 down marginally by 2 per cent. Despite this, brands in the financial sector still made the largest contribution to the overall value. Significant growth was also seen across multiple other sectors including auto and consumer goods. The airline sector made it to the BrandZ India Top 50 rankings for the first time with IndiGo and Jet Airways positioned at No.26 and No.36, respectively.
Also, the number of brands of Indian origin increased from 35 brands in the Top 50 in 2014 to 38 brands in 2016.
Key highlights mentioned in the study:
Financial brands continue to dominate: With 10 brands in the Top 50, accounting for 38 per cent of its value ($34.28 billion), the financial sector has built brand value by making a consistent effort to serve consumers better. Private banks make up three of the fastest risers: HDFC Bank (No.1, +15 per cent), Kotak Mahindra Bank (No.7, +39 per cent), and IndusInd Bank (no.12, +18 per cent).
Airlines enter the rankings: With the entry of IndiGo (No.26) and Jet Airways (No.36), the airlines category gains representation in the BrandZ India Top 50 Ranking for the first time. This year, an automobile brand has also made an entry in the Top 50 ranking with TVS (48).
Retail sector debuts in the list: For the first time in three years, a retail brand, Reliance Retail (No.50), has secured a position in the Top 50 ranking, signalling a strong growth in the sector.
Local Indian brands gaining ground: Over 5,000 years of rich cultural inspiration and tradition seem to be gaining ground as locally-grown brands are inculcating national pride among consumers. An example of this is the growth of Patanjali having emerged from an Ayurvedic products brand to a full-fledged FMCG brand.
Brand Contribution leaders ranking remains strong: The cosmetics brand Lakmé ranks first in Brand Contribution, with all the 2015 Brand Contribution leaders returning in 2016. Focussing on the core essence of a product after distilling price and other purchasing influencers, the Brand Contribution Index suggests that the consumers' decision to use a particular brand is based on emotional affinity, distinctive and trendsetting characteristics, and high recall.
Quality over quantity: Indians are choosing to trade up, selecting quality over quantity, and benefitting from price promotions as the online shopping space continues to gain prominence and fuel aspirations among rural Indians. 'Premiumisation' is a growing trend affecting multiple categories including mobile phones, beauty parlours, and public transport services.
Brand loyalty is weakening: Internet penetration has risen sharply with the number of people living in rural areas accessing the internet having almost doubled over the past year, and almost 69 per cent of urban internet users using the internet every day. This educates consumers while also provides them access to a larger diaspora of premium brands available at affordable prices.
David Roth, chief executive officer, EMEA and Asia, The Store WPP, comments, "The 2016 BrandZ study shows the extent of change India has witnessed and its continuing potential. India has relaxed ownership rules across key industries and is making doing business in India easier, with the parliament having taken unprecedented steps to replace a complicated mix of national, state, and local taxes with a single Goods and Services Tax (GST)."
Dinesh Kapoor, Kantar Millward Brown's managing director, South Asia, says, "Over the past year, brands have had to work hard to hold on to their position in the Top 50. Twenty brands have witnessed a drop in their ranking within the Top 50. Brands which have managed to sustain their ranking over the past two years have only been able to do so by increasing their brand value by over 35 per cent. For these brands, it is critical that they identify fundamental insights about consumer needs and also assert their difference from the competition. Innovation helps create the perception of difference while meaningfully different brands build salience with great creative advertising and a strategic media mix."
Ranjan Kapur, country manager, WPP India, adds, "Brands, these days, need to find ways to support the national agenda, and help to develop a more modern, prosperous and equitable society. Their focus needs to remain on building trust among consumers by connecting with the country's sense of responsibility. Successful brands in India help in building India as a nation."
Click here to view the report