Brand Finance released its annual list of the top global bank brands. China’s banks topped the list with ICBC coming in at the number one spot, valued at $79,823M. The U.S. banks cracking the top ten are Wells Fargo at number five; Bank of America at number six; CITI at number seven; and Chase at number eight. The Visual Capitalist created a helpful visual showing the rise and fall of the top ten brands over the last ten years. As a sector, banks lagged behind hotels, autos, tech, beer, oil & gas, airlines, insurance, and utilities.
The methodology used by Brand Finance to value a bank brand is the Royalty Relief approach. This methodology estimates the likely future revenues attributable to a brand by calculating a royalty rate that would be charged for its use, to arrive at a “brand value” understood as a net economic benefit a licensor would achieve by licensing the brand in the
Brand Finance assigns a Brand Strength Index number, which is applied to the prevailing royalty rate ranges for like goods or services based on prior licensing deals or court decisions. For example, if the prevailing royalty rate range is 0-5% and the Brand Strength Index number is 80, then the royalty rate would be set at 4%. Basically, the stronger the brand the higher on the range a particular brand will land.
For Brand Finances analysis, it is key get a high Brand Strength Index number. The Brand Strength Index is made up of three variables: Marketing Investment, Stakeholder Equity, and Business Performance. Of the three variables, Stakeholder Equity is the most subjective, but one metric considered in this analysis is “awareness.”
We talked before about what is takes to build a strong brand worth billions of dollars. Starting with a unique mark that is conceptually strong and not part of a crowded field is an important first launch pad.