South Africa’s retail sector may be facing headwinds that have seen some grocers struggle and others stoop into value propositions to attract consumers on the back of subdued economic activity.
However, the country’s supermarket chains have remained among the strongest brands, banding together with the likes of MTN, Standard Bank and Nando’s among the top 10 most valuable brands.
The 2024 Top 100 South African Brands List released yesterday by Brand Finance, a global valuation consultancy, features six retailers in the top 10-ranked South African brands.
“South African retailers remain amongst South Africa’s strongest brands, despite mixed brand value fortunes. There were six retailers in the top 10 strongest brands in South Africa, indicating the sectors’ overall strength,” said Brand Finance yesterday.
Woolworths remained the strongest retail brand for the second year in a row.
Although the South African retailers scored high in the rankings, they fared differently in terms of brand value.
Woolworths, Pick n Pay, Game, Clicks and Mr Price saw their brand values decline year-on-year, while Checkers and Dis-Chem bucked this trend.
Checkers added a massive 14% to its brand value to achieve a valuation of almost R1 billion.
Brands under Shoprite included in this year’s rankings had a cumulative value of R41bn.
U-Save and OK Furniture are seen as the fastest-growing South African brands in 2024, with 54% and 43% brand value growth, respectively.
Nonetheless, MTN maintained its position as the most valuable South African brand, despite experiencing an 8% decrease in brand value to R68.2bn.
MTN has significantly expanded outside of its home market of South Africa and now has a stronghold in the populous but problematic nation of Nigeria.
The West African country is now MTN’s largest market in terms of revenue and network user numbers.
Rival mobile operator, Vodacom, banking on the backing of its international shareholder Vodafone, saw its brand value increase by 10% to R43.9bn.
As a result of this, Vodacom secured second place on the rankings.
Brand Finance research indicated that “the influence of majority shareholder Vodafone bolsters Vodacom's brand” through enhanced brand equity, recognition and market standing.
Vodacom, however, operates autonomously and is listed on the Johannesburg Stock Exchange.
Nando's was a new entrant, easing into fourth position at a brand value of R28.2bn.
“Nando's is a brand which proudly boasts of its South African heritage and culinary innovation in its stores globally,” Brand Finance said.
Jeremy Sampson, chairman of Brand Finance Africa, noted that the chicken fast-food franchise was previously excluded from the rankings due to difficulties in accessing financial data. However, thanks to new data sources, Brand Finance has conducted a brand valuation of the company for the first time.
"Amid the myriad of challenges that South African businesses are facing, our research highlights that now, more than ever, brand consistency is crucial in driving growth,“ Sampson said.
“For the past fifteen years, MTN and Vodacom have consistently maintained their positions as the top two most valuable brands and six of the top 10 brands have stayed in the top 10.”
South African finance institution, First National Bank’s brand value was adjudged to be 2% stronger this year at R26.6bn.
This was on the back of stronger consumer acceptance of its 2022 brand update which appears to have enhanced its brand equity and appeal.
“This success is attributed to the bank's strategic shift towards positioning itself as more advisory-focused, rather than merely product-oriented.”
Another lender, Standard Bank, saw its brand value go up by 27% to R37.5bn.
Brand Finance has identified that this substantial uplift in brand value was due to Standard Bank's strong market presence and the effectiveness of its strategic business initiatives.
“It’s success in its operations in Africa outside of South Africa contribute significantly to the strong brand valuation,” it said.
BUSINESS REPORT