Brands by Value: full results

Brand valuation and marketing company Brand Finance has compiled a ranking of the world’s biggest spirits by  brand value. Here is the top 50.

Brand value in brief

This year’s Brands by Value table ontinues to see a volume shift towards local brands from developing countries. The potential for these brands, especially from China, is immense and opportunities to develop variants to enhance margin – and, in turn, cross borders – remain. Margin growth remains with the global power brands however.

Johnnie Walker runs away from the pack

Johnnie Walker bestrides Brand Finance’s latest drinks league table like a colossus. More than $2bn clear of second place, its $4.37bn brand value represents unrivalled margin growth. With its emphasis on big ideas based on core category motivation and enhanced by innovation, its value growth means it is pulling away from international rivals. Exceptional growth of more exclusive variants such as Blue Label and the Double Black, which commands a 20% premium over Black Label, is partly responsible. 

Whisky galore

Whisky brands account for more than a third of the total brand value in the top 50, with Scotch whisky pulling away from other whisk(e)y styles. The combined brand value of all featured whisky in the list is $14.29bn. This is more than the totals for the next three most valuable categories combined – vodka, baijiu and rum have respective values of $5.35bn, $4bn and $3.73bn. Cognac, liqueur and rum brands are next, making up 9% ($3.45bn), 5% ($1.78bn) and 3% ($1.34bn) of the total brand value.

Cîroc the party

Cîroc, the ultra-premium vodka, has seen the largest jump in ranking, rising 16 places to number 19 thanks to an 82% increase in brand value. The main driver of this growth can be attributed to clear positioning as the ‘celebration’ drink to be seen with. Celebrity Sean ‘Diddy’ Combs is the brand’s part owner and spokesperson. Case sales were 2.1 million in 2012 compared to only 400,000 cases sold four years ago.

AAA brands

As part of a brand valuation exercise, the strength of a brand is evaluated against its peers across a number of measures, including emotional connection, financial performance and sustainability, among others. This is used to arrive at a brand rating which ranges from D to AAA.

Johnnie Walker, Hennessy, Jack Daniel’s and Famous Grouse achieve AAA brand ratings. This puts these brands in an exclusive club of brands that have the most potent hold over consumers in their sectors. Brands with similar ratings in other sectors include Ferarri, Apple, Disney and Manchester United.

Biggest Movers

Rising from the east

With European market volume flat, emerging markets continue to be essential for brand value growth. McDowell’s collective case sales (rum, brandy and whisky) rose 5.7 million to 53.4 million. India’s most valuable drinks brand continues to capitalise on burgeoning domestic demand and has improved both its brand value, now AA, and its position against other global players, moving up two places to 23rd. South Korea’s Jinro has seen sales of its soju increase by 3.9 million cases, fuelling impressive brand value growth of $353m.

Made in China

Baijiu brands Kweichow Moutai and Wuliangye Yibin are two of this year’s fastest risers, with brand value growth of $874m and $330 million respectively. Moutai has become the world’s second most valuable brand, with a value of $2.37bn. The challenge for local Chinese brands will be to try to expand their markets beyond China to insulate against evolving legislation changes at home. 

Champagne and wine

With a few exceptions, wine and Champagne brands continue to struggle. The biggest mover is Concha y Toro, which has seen its brand value increase by 35% to $663m. This can be attributed to the brand’s acquisition of declining Californian winemaker Fetzer Vineyards. Concha y Toro has been able to leverage this acquisition by taking advantage of its extensive distribution network, which includes subsidiaries in South Africa, Scandinavia, Brazil, UK and Singapore. 

Wine Brands

Brand Finance CEO David Haigh said: “Though Chinese brands are making huge strides in volume share, the success of global brand ideas, innovative NPD and imaginative communication continue to drive margin growth for global brands.”

Analysis by Brand Finance ( Other commentary contributions from Ed Will of Breakfast ( Wine and champagne brands are now recorded in a separate table so the number of spirits brands increases to 50. Last year’s rankings have been adjusted to reflect this change.

The methodology

Brand Finance calculates brand value using the Royalty Relief approach. This involves estimating the likely future sales attributable to a brand and calculating a royalty rate that would be charged for the use of the brand.

The steps in this process include:

- Calculate brand strength on a scale of 0-100 according to a number of attributes, such as emotional connection, financial performance and sustainability. This score is known as the Brand Strength Index

Determine the royalty rate range for the alcoholic drinks sector by reviewing comparable licensing agreements sourced from Brand Finance’s database of licence agreements and other online databases

Calculate royalty rate – the brand strength score is applied to the royalty rate range to arrive at a royalty rate. For example, if the royalty rate range in a brand’s sector is 1%-5% and a brand has a brand strength score of 80 out of 100, an appropriate royalty rate for the use of this brand in the given sector will be approx 4% 

Determine brand-specific forecast revenues using a function of case sales, average prices and equity analyst forecasts to determine the proportion of a parent company’s revenues attributable to a specific brand

Apply the royalty rate to the forecast revenues to derive brand revenues

Brand revenues are discounted post tax to a net present value which equals the brand value

Brand ratings

These are derived from the Brand Strength Index which benchmarks the strength, risk and future potential of a brand relative to its competitors on a scale ranging from D to AAA. It is conceptually similar to a credit rating

AAA – extremely strong, AA – very strong, A – strong, BBB-B – average, CCC-C – weak, DDD-D – failing

Analysis by Brand Finance ( Other commentary contributions from Ed Will of Breakfast (