Brand Finance Plc, a brand valuation and strategy advisory firm, has published the first index of Malaysia's top 50 brands based on the attributed dollar value of their brand assets.
At number 1, Petronas - the Oil & Gas conglomerates brand, is the most valuable Malaysian brand and is worth USD 2.15bn (MYR 7.51bn) out of the total brand value of Malaysia's top fifty brands which is USD 17.26bn (MYR 60.19bn). The top 10 Malaysian brands command more than 60% of the overall Top 50 brand value and overall the brands. These top 10 are as follows:
For more, click here to download the full report in PDF.
The methodology used by Brand Finance Plc to calculate brand value is the 'royalty relief’ approach. It assumes a company does not own its own brand and calculates how much it would need to pay to license it from a third party. The present value of that stream of (hypothetical) royalty payments represents the value of the brand.
In a highly competitive local, regional and global marketplace there is a premium on brand's ability to differentiate and communicate their unique ability to satisfy customer needs. The report highlights that in such an environment sources of value creation have moved increasingly from tangible assets (such as plant and machinery) to intangible ones (such as brands,patents, customer databases and skilled workforce). This is an environment in which the scarce resources are not factories and goods, but rather talented people, good ideas and differentiated brands.
Reflecting this shift in the sources of value creation, the Brand Finance Global Intangible Study 2007 for globally listed companies shows that the percentage of value of intangible assetts has risen from 64% in 2001 to 66% in 2007.
However, in Malaysia, the recognition of intangible value is low compared to other countries. The report shows how ony 40% of Malaysia’s market value is derived from intangible assets, as compared to the US where 70% of US market value is derived from intangible assets.
However, there does seem to be an increased emphasis on improving these intangible assetts. Reflecting this growing trend, the Association of Accredited Advertising Agents of Malaysia (4As) and Interbrand (global brand consulting firm) are collaborating for the first time to come up with another ranking of Top Malaysian brands.
This effort also highlighted the value of branding with the Interbrand strategy director Andrew Martschenko saying that two-thirds of the world’s wealth were attached to the top corporate brands in the West. The 4As and Interbrand ranking would be announced on Nov 16.