MTN Named SA’s Most Valuable Brand

Picture: Freddy Mavunda/Financial Mail

MTN has increased in value in the past 12 months by more than $1.6bn (R26bn) to become SA’s most valuable brand and, given its current play to acquire Telkom, that trajectory is likely to continue.

The telecoms brand has surged up the Kantar BrandZ ranking to take the No 1 spot for the first time.

The data research agency values MTN at $3.7bn. Rival Vodacom has dropped from second to third place even though its brand value has risen year on year from $2.5bn to just over $3bn.

Kantar’s annual global and local rankings combine financial data with brand equity research. This year’s ranking is based on the opinions of 37,500 SA consumers about 820 brands across 53 categories. To be eligible for the local report, a brand must have originated in SA and be owned by a listed enterprise. Complete financial statements must be available in the public domain.

FNB, which topped the 2021 ranking, is in second place this year with a brand valuation of $3.5bn. Its brand value has increased by just over $800m.

Woolworths has dropped off the top 10 list in 2022 and its place has been taken by Capitec Bank, which has a brand valuation of just over $1.3bn. Woolies, though, has been recognised with a special sustainability award.

Other highlights of the survey include retail pharmacy chain Dis-Chem rejoining the top 30 as one of the most “trusted and purposeful” brands in the country, and alcohol brand Brutal Fruit joining the top 30 list.

The combined brand value of SA’s top 30 is $34.9bn, a 21% increase over last year and a figure roughly equivalent to the GDP of Cameroon.

Kantar says MTN’s leap in brand value has been assisted by a combination of overseas expansion and sound strategic positioning.

Twelve SA brands boast growth of more than 21%, including Investec (No 16, $700m) and retail giant Checkers (No 23, $531m), whose Shoprite Group parent has focused heavily on accelerating digital transformation.

Ivan Moroke, CEO of Kantar SA’s Insights Division, says: “SA’s most valuable brands have been leaning into their home country’s reputation for resilience and resourcefulness to meet the many health, social and environmental challenges they are confronting. Through technology and sustainability initiatives, as well as adding customer-centric services and expanding overseas operations, the strongest brands, led by MTN, have found avenues for significant growth as the country returns to steady financial recovery.”

Stina van Rooyen, Kantar BrandZ lead for SA, says top-performing brands are focused on getting their four fundamentals for growth right — exposure, function, convenience and experience.

Kantar says brands that are growing in SA tend to be “highly dynamic, launching new products and services, expanding into adjacent categories and occasionally entering completely different ones”.

It adds: “For example, telecom providers are offering payment services, insurers are opening banks, pharmacy retailers are selling their own medical insurance, and alcohol brands are launching fragrances. Of concern to advertising agencies is that many of the top brands have made a strong return to the market despite a sharp reduction in advertising spend at the onset of the pandemic.”

Notes Van Rooyen: “It is not always about how much marketers spend on advertising, but the quality and efficiency with which they spend. Ensuring that you’re using the right channels and using messages that really connect with your customers can make your marketing budget go further.”

While banks, telecom providers and retail dominate the ranking in both value and growth, with a 31%, 21% and 15% share of the overall brand value respectively, alcohol and insurance brands have declined slightly in value.

Brands should also note that while sustainability drives 3% of brand equity globally, in SA this number rises to 5%. The lesson here is that brands must learn how to tap into this opportunity to drive additional growth.

This piece originally appeared in the Financial Mail.