Incumbent financial services firms have a lot of brand value, but unfortunately for them, so do others. And their brand values are getting higher. However, this year, the majority of the sector saw rises in brand value. Furthermore, the big card firms saw double digit rises. Patrick Brusnahan reports
Brands rise and fall. Since Interbrand began publishing its ranking of the most valuable brands, a lot has changed. In its 20th year, only 31 brands, such as Disney, Nike and Gucci, remain in the ranking. 137 brands, like Nokia and MTV, have entered and left. Coca-Cola and Microsoft are the only two to have retained top ten spots since then.
In 2001, the cumulative brand value in the top 100 brands was $988bn. In 2019, it stands at 2.1trn.
Twelve brands from the financial sector made the Interbrand’s top 100 this year, all of which have been there before.
“The finance sector has a reputation for being traditional; a long way from the global ambitions of Silicon Valley and big tech’s move-fast-and-break-things attitude,” the report said.
“But as technology’s influence sets and resets customer expectations, the financial services sector becomes ever more vulnerable to the looming threat of disruption.”
The highest ranked was American Express which landed in 23rd place with a brand value of $21.6bn. It was followed by JP Morgan in 25th place ($19bn) and Citi in 41st position ($12.7bn).
Visa is in 55th place with a brand value of $10.8bn and Mastercard is just behind in 62nd position and a brand value of $9.4bn. However, Mastercard had the highest level of growth over the year, increasing its brand value by 25%.
American Express and Visa also witnessed double digit rises over the last twelve months, 13% and 19% respectively.
The other financial brands in the ranking are Allianz, AXA, HSBC, Goldman Sachs, Santander, Morgan Stanley, and PayPal. All of these witnessed rises in their brand values apart from Goldman Sachs (a 4% decrease) and Morgan Stanley, which fell 7% in its brand value.
On Mastercard, the report stated: “Its ascent has been fuelled in part by its transition from finance provider to technology firm, which should give many of the other brands in this arena pause for thought.
“But don’t be fooled by that one shining star—Mastercard has very much bucked the wider sector trend, which is one of stagnation. Because, while financial services is broadly represented in our ranking, none of those brands made the top 20.
“One final note on Mastercard’s ascent. It appears to reflect a wider trend in the arena of money, which is that the real gains are being made by businesses that harness the disruptive forces of technology.”
Financial brands need to be aware of shifts in the market. While there was growth this year, and Mastercard has the highest of all brands, there are many other sectors growing.
Amazon was the 3rd most valuable brand and, even from such a high value, managed to grow another 24% to hit $125.3bn in value. Another technology outfit, Microsoft, grew 17%. Uber made its first appearance in the top 100 in 87th place with a value of $5.7bn.
There needs to be shifts in financial services’ thinking before these “exciting” digital outfits start to see their promise transform into brand value. Otherwise, it may not be very long until the incumbent financial brands are nowhere to be seen.