Yili tops Brand Finance list of world’s most valuable dairy brands

Looking beyond the food & drink sector, however, the value of the 500 most valuable brands in the world, ranked in the Brand Finance Global 500 2020 league table, could fall by an estimated $1tn as a result of the coronavirus outbreak.

Brand Finance assessed the impact of COVID-19 based on the effect of the outbreak on enterprise value, compared to what it was on January 1, 2020. The likely impact on brand value was estimated for each sector. The industries have been classified into three categories – limited impact (minimal brand value loss or potential brand value growth), moderate impact (up to 10% brand value loss), and heavy impact (up to 20% brand value loss) – based on the level of brand value loss observed for each sector in the first quarter of 2020.

Yili grows 13%

Recording a brand value growth of 13% to $8.6bn, Yili has now overtaken Danone to become the most valuable dairy brand in the world, as well as claiming second position in the overall Brand Finance Food 50 2020 ranking.

As Asia’s most valuable dairy brand for the last five years, Yili has continually expanded into new territories, ratifying the brand’s aim to build a global network and target 2bn consumers by the end of 2020.

Domestically, Yili has invested $4.3bn in constructing a high-end organic dairy production base in Inner Mongolia, which is expected to generate 60,000 jobs as well as stimulate local farming and logistics industries. Abroad, Yili set its sights on New Zealand, acquiring 100% of equity of the country’s second largest dairy producer, Westland Milk Products.

Brand Finance said Yili could see the gap ahead of Danone widen as the brand enjoyed formidable quarterly results, staging a strong rebound in the second quarter despite the pandemic’s negative impact at the beginning of the year.

For the first time, the Brand Finance Food & Drink 2020 report includes the Dairy Portfolio ranking – a ranking that splits the brand value related to dairy brands from the wider food portfolios – as dairy brands represent a large proportion of the food portfolios’ brand value and often are responsible for movement within the overall ranking.

Yili also has the fifth most valuable dairy portfolio, with a total brand value of $8.6bn. Nestlé once again leads the way, boasting the most valuable dairy portfolio with a combined brand value of $12.6bn. Lactalis’ (total brand value $11.7bn) and Danone’s ($11.6bn) dairy portfolios claim second and third respectively.

Savio D’Souza, valuation director, Brand Finance, said, “As a brand committed to continuous innovation in the industry, it is unsurprising that Yili has managed to continually achieve its expansion goals this year, even despite the COVID-19 pandemic. In the coming year, Yili’s strong strategy of innovation is set to be the brand’s core power for growth in the future.”

Nestlé retained the title of the world’s most valuable food brand following a 3% brand value increase to $20.3bn. The Nestlé portfolio is once again the most valuable food & drink portfolio, with a total brand value of $68.5bn.

Brand Finance said in the dairy sector, the Indian brand Amul is one to watch this year as the fastest growing dairy brand, increasing in brand value by 25% to $3.1bn. The brand has focused on diversifying its portfolio, launching its Tru range. The brand cites improvements in its infrastructure, and thus increased sales in rural areas, as a key reason behind its recent solid financial performance.

Brand value is understood as the net economic benefit that a brand owner would achieve by licensing the brand in the open market. Brand strength is the efficacy of a brand’s performance on intangible measures relative to its competitors.