THE BEAUTY ENTREPRENEUR: THE TOP 50 GLOBAL BEAUTY BRANDS

This is a must read for all beauty industry professionals, especially marketing executives of Small/Medium companies who someday plan to compete in the Regional/Global markets. The beauty industry continues to thrive despite harsh economic conditions in most markets. Many companies are seeing dramatic increases in growth especially in the emerging markets such as India, China and Nigeria, while premium luxury brands like Channel, Christian Dior, L’Oreal and some of Estee Lauder brands are doing extremely well most notably in these emerging markets in spite of all odds.

This report showcases fifty topmost positioned brands in terms of Value around the globe, from 2011 into 2012. Most of these brands have been around for 60 years, some for a hundred plus; Judging by their continued performances, they’ll be here for a long time to come. Most of them you have come across in some of the African markets especially South Africa and Nigeria. And the others you haven’t seen before you might begin to see here within the next few years – after all, Africa is positioned as the next Hub of the Beauty Industry and the global players are constantly and aggressively expanding their horizons**.

OLAY - Most Valuable Beauty Brand in the World

Following humble beginnings in the South African home of Chemist Graham Wuiff in the 1950s and now domiciled in the great U.S of A, the Olay Brand has become a globally recognized skincare giant, part of P&G’s product portfolio and the Proud Numero Uno on the top 50 brands list, up from a Brand Value of $11 million to $11.8 million for 2011/2012 respectively. This seems a befitting birthday gift for the 60year old iconic brand.

Michael Kuremsky, P&G’s Global Vice President and G.M of Skincare had this to say on OLAY: “We try to be at the forefront of innovation, with new ingredients and technologies that really transform the skin, so it’s a true honour to be recognized for this and ranked as the world’s top beauty brand.” “This year also marks Olay’s 60th anniversary, so we are grateful that millions of women around the world continue to trust Olay for their skin care needs.”

Runner up AVON struggles into second place despite losing US$ 2.2 billion in brand value with a 22% decrease ($10.1 million in 2011 to $7.9 million for 2012). Dove moved up one step from last year and has been valued as the United Kingdom’s most valuable beauty brand and one of the most trusted brands in India, with a brand value of US $5 billion after a successful year in 2011.

The year 2012 saw the brand valuation of Avon suffer a big loss after a difficult period for the brand following the company’s stock dropping 45% in 2011 and the resignation of Andrea Jung as CEO. Sherilyn McCoy will now follow in Jung’s footsteps and seems certain to face a tough time. Despite this Avon remains the 2nd Top Beauty Brand thanks to the loyalty of their customers and their strong commitment to woman’s empowerment, ‘Avon continues to improve women’s lives on the developing world by providing them with means to earn money and support their families’ said Mary-Ellen Field, Associate Director of Brand Finance.

While an avid player in the industry would not be surprised at Olay’s position on this list, it is instructive to find some of the more popular brands at the bottom of the list, or names you’ve never come across occupying prime positions. According to Brand Finance, each brand’s valuation result is calculated by creating a balanced scorecard of Financial, Risk and Brand Equity measures. The analysis is then used to allocate an appropriate proportion of future sales to the brand, thereby calculating a financial value for the brand. The brand values are heavily influenced by both profit margin and sales volumes. As a result, brands like Softsoap and Aveeno, while not having high profit margins, did have relatively high sales volume (over $1billion and over $2billion respectively) which ensured they emerged in the Top 5o list for 2011, though Softsoap dropped ten steps in 2012, while Aveeno maintained its 15^th position. What this means is that such brands have a larger brand value than a niche luxury brand that may be perceived as a more excellent brand, but only targets a small consumer base and therefore has very low sales volumes. For example, a brand like Crème de la Mer has a very high price point and would have very high brand equity scores. However, due to the relative size of its sales compared to other brands on the list, it does not feature on the Top 50.

Another significant factor that affects the brand value is the delivery channel – i.e., whether products are readily available to consumers or restricted to limited specialist channels. Global companies are increasingly adapting to meet the demands of newly emerging markets across the globe, with these companies looking to target all ages and cultures. The more they are able to adapt their brands, the greater their potentials.

Following therefore is a list of the Top 50 global beauty brands, their Brand Value for 2011/2012, enterprise Value and Estimated Revenue for 2011; ranked from highest to lowest in USD revenues.

DOWNLOAD TOP 50 GLOBAL BEAUTY BRANDS’ LIST HERE

P&G dominates the mass market sector with its Olay brand in terms of Brand Valuation, though P&G itself does not rank highly as a brand. For Avon and L’Oreal however the company name is very much the brand. In spite of the difficult trading terrains in many markets, the Beauty Industry has proved its resilience and ability to adapt to new challenges, hence its not surprising that the Industry continues to attract worthy investors, especially across the emerging markets of Asia & Africa.

David Haigh, CEO of Brand Finance, commenting on the table stated: “Whilst the Top 50 Beauty Brands might appear to be dominated by the USA, France and UK, nations such as Japan have begun to emerge as forerunners in the industry and it seems likely that as the European economic crisis continues we will soon see the appearance of many more beauty brands from the emerging markets in our global ranking.”

So, where are the “Ofra”, “Tara Orekelewa” and “So Aesthetics” of Africa brands?