Brand Finance identifies which brands will increase their market share in 2021
Brand Finance has created a unique model capable of forecasting sales growth as a result of long-term brand equity and brand awareness.
The model, called BrandBeta, is calculated with the statistical regression analysis process where the relationship between the brand attributes, familiarity and relevance, as well as their impact on market share, is studied.
BrandBeta Spain 2020of Brand Finance, the independent intangibles valuation consultancy whose rankings comply with ISO 10668 and ISO 20671 for brand valuation and evaluation respectively and which contributes with its brand value database to create one of the Index indicators of Global Innovation (GII) of the UN, has made a new report that anticipates which are the brands that will increase their market share in 2021, has analyzed the Spanish market in its inaugural report, being able to accurately forecast the market share and changes in the revenue of brands year over year.
Teresa de Lemus, Managing Director, Brand Finance Spain: "Our regression analysis gives us a statistical basis to understand not only how the brand behaves itself, but the correlation of its drivers, extremely relevant information when managing a brand"
The result of our analysis shows that the relationship between familiarity and relevance explains more than 80% of the variations in market share within the categories contemplated in the study.
When analyzing the impact of each result of familiarity and relevance, we see that familiarity accounts for about 60% of the variation in participation, while relevance is approximately 40%. BrandBeta is therefore a combination of the two measures in a 60:40 ratio.
This combination creates a score of 10 that our further analysis shows can be used to forecast market share growth for any brand and in any industry.
In the minds of consumers and clients, the center of any Marketing strategy, they begin by highlighting some brands over others because they have heard about them and they begin to take them into consideration in their purchase decision process because they need it or because they have created the necessity, reasonably priced. In the race to gain market share it is necessary for brands to not forget the basics, sometimes tempted to develop their purpose and reputation, rather than their value offer.
The first step is to be aware of the brand, its knowledge, to have heard of it. From knowledge , a result of visibility , one passes to familiarity , that is, knowing the brand - knowing which sector it belongs to, what products or services it offers, how it works, its values, ... - All this is achieved through a strategic visibility plan and relationship with key stakeholders.
The next step, considering or being on the top of mind of specific audiences requires generating a connection with them. Connection that, together with the needs and other elements such as quality, price and promotion, materialize the purchase and manage to be the chosen brand. This increases the turnover and market share.
Therefore, that value offer must be put on the market making use of visibility. It is the first step to be able to talk about familiarity, consideration and preference, key indicators of the future performance of brands .
In this study, we want to draw attention to consideration, since, according to our analysis, consideration has a very close relationship with the increase in market share , that is, with the growth of sales and therefore of the business. The difficulty is in turning consideration into acquisition. Furthermore, in anticipating and anticipating what could happen.
Teresa de Lemus, Managing Director, Brand Finance Spain: "Being able to forecast market share has two readings: anticipating if it is not enough, reaffirming if it is."
Three Spanish, Mercadona, Correos and Iberia among the top 10 brands that we will consume the most in Spain in 2021.
Google is the product that we have consumed the most in Spain in 2019 and 2020 and it will also be the product that we consume the most in Spain in 2021.
If we only take into account Spanish brands, the top 10 will be Mercadona, Correos, Iberia, El Corte Inglés, Zara, Estrella Damm, San Miguel, Mapfre, Día and Movistar.
Mercadona , the Valencian supermarket chain founded by Juan Roig decades ago, improves its results year after year and gains market share. The sales figure for 2019 was 25,500 million euros, 5% more than in 2018. It is immersed in a project to remodel its more than 1600 establishments, 800 of its stores are already fully renovated (only in 2019 400 were rehabilitated ).
It employs 90,000 people and invested 2,200 million (around 1,500 million will be invested in new openings, store reforms and in the new sections of 'fresh' and 'ready to eat', 421 million in logistics blocks and 247 in exchange digital.). Therefore, it has a BrandBeta score of 9.4 out of 10, occupying the second position only surpassed by Google .
The Valencian, shares a score of 9.4 with Correos . The brand is number 1 for the Spanish for logistics services. The Spanish postal operator dreams of going public, it only has to accumulate a positive track record of good results, but it has an ambitious strategic plan to achieve it, an action that can catapult the brand against competitors such as Amazon .
Iberia , for its part, and unlike the previous two, is fighting hard in a sector highly impacted by the pandemic. All in all, it remains in the top 10 with a BrandBeta score of 9.2. The holding International Consolidated Airlines (IAG ), which includes the airlines Iberia, British Airways (BA), Vueling and Aer Lingus, recorded losses after taxes and exceptional items of 5,567 million euros during the first nine months of this year due to the effect of Covid19.
The company thinks that by implementing mandatory tests it will be able to increase market share and regain the upward trend in business figures.
Thirteen of the eighteen sectors analyzed are led by a Spanish brand, and twelve of them exceed the sector average and eight are sector leaders: BBVA, Meliá, Movistar, Mapfre, Iberdrola, Correos, Iberia and Mercadona.
Four of them belong to sectors highly disadvantaged by the pandemic: Banking (BBVA, score 8.0), Hotels (Meliá, score 8.3), Insurance (Mapfre, score 8.4) and airlines (Iberia, score 9.2). So these brands have had superior performance and deserve special attention.
The final choice for a brand occurs when the brands are reputable, has an offer at the right price, the supply is readily available and product meets your needs. Reputation is, therefore, a key concept to the discuss and try to predict the choice of the customer.
Reputation is important, but it is not the only thing that brand managers should be concerned about. Reputation only explains about 50% of a brand's relevance. The increase in investment must be supported by a strong positioning and vice versa.
BrandBeta is a combination of familiarity and reputation (understanding this as how much good a company or brand contributes for its stakeholders) precisely because both are necessary to drive changes in market share.
Paradores, Iberia, El Corte Inglés, Correos, Mapfre, Iberdrola and Movistar are the Spanish brands with the best reputation in 2020 and sector leaders in their category. Four of them, Paradores, Iberia, Mapfre and Movistar, repeat as leaders in their respective sectors and increase their reputation compared to the previous period analyzed.
Despite the fact that the hotel sector has been literally stopped by the pandemic, Paradores does not give up and even continues to open new establishments such as the recent Parador de San Marcos in León, for which it has made an investment of 15 million euros. For its part, El Corte Inglés , the Spanish department stores, will grow by up to 20% in 2021, as will other retailers such as Cortefiel or Pronovias supported by the online channel as the main generator of demand according to Moody's.
Banking, Telecommunications, Leisure & Tourism, Energy, Textile, Insurance and Distribution are the sectors with the greatest presence of Spanish brands.
Reputation must be closely monitored, but companies must be cautious and do not rely too heavily on reputation as their only savior. A strong, readily available product at the right price can often outweigh a temporarily low reputation.
Therefore, it is imperative that branding and marketing teams review their activities more broadly and identify how they deliver value to customers and other stakeholders and how managing those levers, together, can bring the most value to their business. brand and its businesses.