Best Australian Brands 2009

Best Australian Brands 2009
Ranked by brand value
Contents
01 Best Australian Brands A letter from Damian Borchok 02 Overview Best Australian Brands 2009 03 Why the Best Australian Brands ranking is important 04 The Red Thread by Jez Frampton Putting the brand at the core of the business becomes a uniting force behind everything you do and say to drive value 08 The future of future-proofing brand investments by Greg Silverman How will we measure the unobservable and make informed brand investment? 10 Planning your touchpoints to accelerate profit by Rune Gustafson Understanding brand as a central organising principle requires the management of every touchpoint to build the experience for consumers 12 Interbrands approach to valuing brands Criteria for consideration and methodology 13 Top line industry stories by Lynton Pipkorn Trends and insights into Australian brands 16 Ranking Profiles of Australias Most Valuable Brands and other prominent Australian brands
Appendix 27 Commonly asked questions 32 About Interbrand 32 Contact us
Best Australian Brands

Interbrand presents the fourth ranking of the most valuable Australian brands, arranged by brand value.
The economic turmoil of recent months has made it more important than ever to understand your brand. The past studies of the Best Australian Brands were conducted in times of economic growth. In good economic times, most brands will create some sort of value. But in todays uncertain times, where short- to medium-term profits are under significant pressure, the challenge for all brands will be to evaluate their brand proposition and better understand their customers perceptions of value. At the same time, the dramatic shifts in demand and business sentiment have altered the horizon for most marketing departments. There is continued pressure placed on ROI, and the temptation is to cut marketing budgets, discount prices and reposition brands as value propositions to maintain cash flows. Yet, such tactical approaches may erode long-term brand value we all know it is much harder to trade a customer back up the value chain once margins have been eroded. demand for their goods and services around the world. Strong brands also create allegiance, use differentiation so they are not easily replicable, work harder to impact markets, and command premium pricing. The best brands also attract the best talent, continually reward investors, use leadership to grow market share, and fare better in economic downturns. They are business assets that create value and give companies tighter control of their future.
Biography: As Managing Director for Australia, Damian Borchok believes brands need bold strategies and remarkable creative execution to deliver breakthrough performances. His past clients include Telstra, News Limited, Goldman Sachs JBWere, ASX, Perpetual, Fuji Xerox, Diageo, Qantas, David Jones and Nestl.
As this study shows, many Australian brands are poised for further growth. Australian brands are aggressively seeking to expand away from our shores into larger and more lucrative overseas markets. This promises these brands greater growth opportunities, and reduces risk to their earnings profile and further revenue generation capabilities. Some companies such as Billabong, Macquarie Group, Harvey Norman, Ansell, Computershare, Flight Centre and even Australia Post have now established offshore cash flows. This strategy has proven to be a great success for these brands, and it is clear Protecting the brands long-term compound that many Australian brands are well prepared investment must remain the highest priority. for the challenges that lie ahead. I would like The careful crafting of a brands positioning to take this opportunity to congratulate each must not be put at risk by expedient use of brand in making the Best Australian Brands tactical communications that drive shorttable. I wish you every success in your brandterm volume benefits. Such a strategy can building efforts and the future that lies lead to the destruction of the promises that ahead. I would also like to take this moment created value for the brand in the first place. to thank Monash University and the Faculty The real test for Australian brands weathering of Business and Economics for their research the economic downturn and creating support in producing the Best Australian Brands sustainable long-term brand value lies in 2009 study. understanding these promises and staying true to the pillars that form the foundation Yours sincerely, of a businesss brand value. Strong brands develop even stronger products and services, undeniably creating sustainable value for their owners. If brands are innovative and managed correctly, they can move seamlessly across geographies, transcend different languages and cultures, and create
Damian Borchok Managing Director Interbrand Australia

Best Australian Brands 2009 01
Overview Best Australian Brands 2009

We are delighted to unveil the Best Australian Brands 2009. It is important to mention that there are other valuable Australian brands that would make this list. However, because of differing In order to qualify for the Best Australian Brands reporting periods or the inability to separate study, the company that owns the brand must individual brand earnings from consolidated be listed on the Australian Stock Exchange or figures, we are unable to include or estimate have its financial information publicly available. their individual brand value. The brand must be registered for at least three years, and it must originate in Australia or be The importance of brand valuation owned by Australian companies. The articles in this study introduce the The following insights highlight the specifics importance of understanding the importance of the Best Australian Brands ranking, of brands as a central organizing principle. and the present situation of Australias best Brand valuation is an essential step in this performing brands. process. It provides the weaponry to identify how brand influences performance by elstra, in first position, continues to be T uncovering the key drivers that effect Australias most valuable brand at A$ 9.7 consumer choice. And as a management billion. In second position and valued at tool, brand valuation also reveals a number A$ 7.1 billion, the Commonwealth Bank of of key insights that serve to provide an ROI Australia (CBA) is Australias most valuable perspective and, more importantly, inform banking brand (with National Australia the future strategic direction of the brand. Bank at A$ 5.1 billion taking out third place). These include: he top 10 brands proved to be very stable T and have demonstrated an ability to manage ecommendations for how brand value R their brands to create greater value over drivers can be incorporated into brand a sustained period of time. positioning, media planning, communication touchpoints and experience he big financial services brands in Australia T have not yet been as seriously affected as he health of the brand strengths, T their contemporaries in others countries. weaknesses, brand development This is a result of the legacy of a strong opportunities, brand stretch and market/ regulatory system, strong balance sheets competitive threats and a healthy domestic deposit base. CBA is by far Australias biggest bank and has gained he extent to which brand and T considerable value by representing a safe communications strategies are contributing financial haven for a lot of Australians. to creating brand value f considerable interest going forward will O be how Westpac will manage the value of its A$ 6.7 billion merger (the combined values of both the Westpac and St. George brands). The challenge will be to continue to grow the value of the St. George brand, currently valued at A$ 1.9 billion, without eroding Westpacs value. rivers of competitive advantage and how D these are sustainable reas of brand weakness and the strategies A required to build brand strength and lift brand performance arketing spend guidance to ensure the M greatest value impact The key to successful brand value management for Australian brands is to put in place strategies that take advantage of opportunities in the downturn, then set a budget to achieve that strategy. Brands will need to work harder and smarter in this period to maintain leadership and generate brand value. Central to their success will be the ability to get closer to stakeholders by employing more robust, end user-orientated analytics practices to yield greater evidencebased insights and outcomes. The article, The Future of Future-Proofing Brand Investments, by Greg Silverman highlights how analytics can assist brands to make more informed brand investments. These analytics-based approaches aid precision in decision-making and lead to more effective insights and profitable outcomes. By integrating brand analytics approaches throughout strategy, design and brand valuation, more precise capabilities are now available. These offer more effective diagnostic tools to understand the economic benefits that brand assets provide to their owners. Brands with foresight and vision can now more effectively leverage the differentiation and strength of the brand proposition relative to their competitors. As a result, it is not only possible to quantify a brands contribution in the decision-making process and to measure its competitive strength in acquiring and retaining customers. Now, we can also predict the value of an innovation and understand at which communications touchpoint a brand investment generates the most demand. By better understanding the equity drivers that create demand and impact brand value, brands will be better positioned to maintain cash flows, justify ROI and preserve the now precious equity residing in the brand. In doing this, brands will be best positioned to emerge from the downturn and ready to capitalize on their weaker rivals when markets begin to recover.
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Why the Best Australian Brands ranking is important

The branding practices employed by Australian companies are becoming more and more sophisticated. Interbrands fourth ranking of the Best Australian Brands continues to put an emphasis on brand performance and its contribution to business performance. The ranking provides brand values that are measures of economic performance, stating what the brand is worth overall and among competitors. Brand value brings to marketing what revenue goals or financial hurdle rates bring to other aspects of business. The most important information comes when one looks behind the number as a single number only tells so much. It is more important to understand what drives brand value: Intangible earnings: the cash flow of a business not associated with such tangible assets as equipment or materials The role of brand: a measure of how much brand influences purchasing decisions Brand strength: a benchmark of a brands relative risk compared to competitors Understanding the drivers of brand value can inform management action, from overall business strategy to specific marketing tactics. It is an easy-to-use metric to help brand owners determine where they are, where they are going, and how to get there. Brand valuation can assist in positioning brand building as a critical aspect of enterprise by answering the following questions. Are we investing adequately in our brand? Putting an economic value on a brand (overall and by segment) can help make a strong business case for marketing investments, overall and across a brand portfolio. While delivering a very important ROI measure, brand valuation, more importantly, can help organisations to understand what levers drive brand value. It is these insights that can assist in the appropriate allocation of investment and the development of the strategic catalysts that can influence future value creation. Is our marketing performance effective and efficient? Your customers make decisions every day between you and your competitors. Analysing the role of brand in those decisions helps you to focus your strategy on the attributes that differentiate your brand from others and to strengthen your relationship with your best customers, thereby ensuring future earnings. Are short-term tactics driving long-term value creation? By analysing the strength of your brand, you can target marketing campaigns to your most valuable customers in the most competitive manner. This can enable you to drive short-term sales without sacrificing long-term brand strength and relevance. Most importantly, this ranking is presented to foster debate and put greater emphasis on the practice of branding. Our goal is to demonstrate that brands are important assets yielding significant economic value. To maximise the value inherent in your brand requires proactive and consistent investment, management and measurement. Why do no Australian brands make the Global Best Brands list? While there are many significantly valuable Australian brands, none have yet to appear on the Best Global Brands list. To qualify for the global table, at least one-third of earnings needs to be earned from outside the companys home base. The brand must also be well-established in a wide number of markets around the world and be managed consistently as a global brand. To put it into perspective, the 100th most valuable brand in the 2008 Best Global Brands Study was VISA, with an estimated value of US$ 3.338 billion, which is equivalent to A$ 5.188 billion at current exchange rates. While some Australian brands have a greater brand value, they simply do not have the geographic spread that would make them eligible to reach the Top 100 Best Global Brands list.
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The Red Thread: creating and managing brand value by Jez Frampton
Biography: Jez Frampton, Interbrands Group Chief Executive, is responsible for managing the firms worldwide interests and enhancing the strategic and creative offering. Jezs experience has provided him the opportunity to work with different clients across multiple sectors, including premier brands like Budweiser, IBM and Toyota.
All of the ropes of the royal fleet, from the strongest to the thinnest, are braided so that a red thread travels through all of them, and you cannot remove it without untying all of them. Even the smallest fragment will still allow you to recognise that the rope belongs to the crown.
From Goethes Elective Affinities (1809) The Red Thread is a concept woven through many cultures. According to Greek mythology, Theseus found his way through the Minotaurs labyrinth by following Ariadnes red thread, and a famous Chinese proverb describes an invisible red thread that connects us to all of the people well ever meet. The Russians call it krasnaia nit, and the French le fil rouge. In German, roter faden literally red thread is used to describe the central or recurrent theme of a larger work. The idea of a bright, illuminating thread that runs through everything, from the smallest fragment to the whole, is powerful and captivating. In our world, this is a wonderfully rich and simple metaphor for brand value. The top performing brands understand the reality behind this metaphor. For them, the notion of value runs like a red thread through their brands, driving demand throughout every aspect of their business. They know that their brands must function as assets, not as expenses, and that even the greatest brand idea is only as powerful as its ability to generate value.
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The subject of brand value has been well documented since Interbrand first developed the concept in the early 1980s. Today, our competitors, commentators in the press, the financial community, and the industry at large have much to say about the topic. At heart, its a simple idea. If a brand plays a role in choice and a consumer must choose between different competitive products or services in a marketplace, then the brand must contribute to earnings and profit and hence, must be quantifiable and valuable to the owner. In order to really understand the creation of brand value, we need to understand what factors drive demand, what role the brand plays across each of those factors, and how strong the brand is versus its competitors. But the Red Thread is about more than a value-generating brand. Its about understanding how that value is generated. Its about creating, managing, and measuring brand value across every aspect of the business. To put this into context, lets consider an analogy. Capable of accelerating from zero to 100 miles per hour and back to zero in under four seconds, a Formula 1 racing car represents the very edge of technology in the motor industry. Every car is fine-tuned for each individual race, and every surface and element of the car can be altered to create the best aerodynamics, braking pressure, tire pressure, gear ratios, suspension and more. It is not the car but each individual component of that car that must contribute to the vehicles ultimate success. Whats more, those components can be quantitatively measured, giving the racing team the information necessary to optimise the cars performance in real time. Data streams from car to trackside with
detail about fuel consumption, lubricant temperatures, braking heat and even driver heart rate. When the competition is fierce and the difference between winning and losing can be measured in fractions of a second, every detail must be tuned to win. Imagine how powerful it would be if you understood how your brand creates value to the same degree of detail. Are you as intimate with the performance of your brand as Formula 1 racing teams are with the performance of their cars? Are you as prepared to battle the competition? Do you quantitatively understand exactly how your brand generates value? By using brand valuation as a diagnostic tool, we can now understand the precise economic benefits that brand has on every aspect of our businesses. It is now possible not only to quantify a brands contribution in the decision-making process and to measure its competitive strength in acquiring and retaining customers, but to predict the value of an innovation and understand at which touchpoint our brand investment generates the most demand. The Red Thread helps us see where in the acquisition process we lose potential customers to our competitors, which brand attributes are relevant at each step in the customer journey, and far more. Most importantly, it helps us determine exactly what it is that must be changed, and how, in order to maximise value.
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Brand building isnt a separate exercise from the day-to-day running of the business. It is integral to it.
Consider our work for BMW. Everything in that organisation is coerced and corralled into a single unifying vision, all united by one value-generating idea. For BMW, this red thread is the commitment to please customers with the very best in automotive engineering. This manifests itself in a few obvious ways, such as its tagline and messaging, but also guides management decisions on everything from showroom plans to fabric choices, and ensures that the companys outer voice (what it says its going to do) reflects its inner voice (what it actually does). And, as 93 percent of employees believe that BMW Group is a great place to work, its no wonder this translates to a brand worth US$ 23 billion and the highest brand value per automobile sold. This is true of many of the worlds most valuable brands. Look at Apple, whose promise of a different experience through ease of use creates a red thread that touches all aspects of their business, including product innovation and interface design. At Disney, the commitment to create magical experiences produces undeniable value, forming a red thread that affects everything from the appearance and behavior of its cast members to its television programming. For Nike, the idea of performance runs through the business from Just do it to how the organisation gets it done.
Or take Interbrand, an example that is near and dear to me. For us, the notion of brand value itself is our Red Thread. We are the consultancy that sees brands as economic assets, as drivers of demand, and creators of wealth. We believe that behind every great brand is a great idea that generates value. Our daily mission is to understand how that value is created across our clients businesses, providing strategic advice and creative solutions that have a common purpose and foundation in generating demand. Whether we are producing the corporate identities that will fuel the iconic images of the 21st century or crafting brand architectures to optimise the way a major global enterprise manages its assets, value is quite simply the lifeblood at the very heart of our business, the common theme that unites us and makes us stand out from the crowd. I believe that the concepts of brand and value are inseparable. To be truly effective, brands must be built around the thing that generates the most value for your business. A brand conceived in this fashion will create demand, in turn improving the monetary value of the business. Managed properly, this evergrowing cycle of value creation will define the very essence of the 21st centurys eminent brands.
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But to get there, we need to change the fundamental way that we think about our businesses. Most companies spend massive amounts of time and money optimising their supply chains, but few are willing to make an adequate investment in the demand side of their businesses. This is most likely because the supply side is physical and real. Its easy to understand the return on tangible investments. The demand side of our businesses, though, is often less clear. It requires courage to invest in intangible assets. Thankfully, the ability to measure these intangible assets through precise analytics should help us refocus our attention on creating demand. We must also change the way we think about brands themselves. Ten years ago, brands were seen as an extension of marketing: a kind of halo around a business that made it emotionally appealing. Marketing departments spent time creating brand ads with their agencies, an exercise seen as more strategic and separated from the day-today process of selling products, announcing promotions, or launching campaigns. Today, the world has come to realise that brands are an extension of business strategy. Now understood to define the essence of differentiation and to serve as primary and integral drivers of demand, brands have as much to do with product, service, retail, packaging, culture, web, pricing, channels, and environments, as they have to do with marketing and communications.
Thats a powerful shift in thinking in a relatively short period of time. Not everyone is there yet, but the leaders are. The global corporations at the top of the Fortune 500 or our own Best Global Brands ranking see the world this way, and its only a matter of time before it becomes common practice. Some audiences, despite accepting the notion of a red thread, might believe that the current economic climate makes this the wrong time to invest in measuring and managing brand value. But this could be a costly mistake. This is the ideal time to optimise budgets to ensure that every dollar spent is driving demand and creating value. Every boardroom is subject to greater degrees of scrutiny over the use of shareholder funds and now, more than ever, we need to know where were likely to win, and where were likely to lose.
All businesses that aspire to build greater value should consider their red thread. Without one, your brand may not be generating real value.
The future of future-proofing brand investments by Greg Silverman

Biography: Greg Silverman is the Global Practice Leader of Analytics. With over 20 years of experience in the business, Greg and his team measure brand investment to show in advance whether an idea has the potential to earn brand equity. He has done work on an extensive list of clients that boast some of the biggest brand names in the world, including AT&T, Bank of America, Lexus, and Gillette.
The web search definition is important because it suggests that brands are competing with each other for consumers. When focusing on competition, the branding industry traditionally looks to the role of the brand, as it is a measure of influence and compares the brand against other decision criteria. This measure of influence is capitalised on when a brands equity unlocks value by connecting with end-users. Unlocked value is brand strength the ability to protect future revenue. The new order This relatively static picture of competition and branding has dominated the landscape for decades. However, over the last decade, this framework has broken down with the increasing dominance of social networks. Social networks are moving the branding debate from the traditional and hierarchical to the latent and networked. As such, the long-held view of competition and branding no longer works because the forces behind the collective value of all social networks have changed. In short, our customers culture is trumping our strategy. Along with the declining relevance of old strategy models, we are witnessing a decline in the impact of the measures attached to them. The greatest advance in the past decade has been in the realm of choice-based research and marketing mix models that measure change in a limited number of issues in a marketplace. Marketing mix models are rooted in the conventional wisdom that, if you track spending and sales simultaneously controlling for all other variables then you can clearly identify what is optimal. A question still remains: What company can actually control for all the variability of the market? Media mix has clearly improved efficiency, but the process is backward-looking. Additionally, the rigid data requirements do not accommodate the most important factor: emergent social network influences are not simple to track. Heres a common example: Apples new iPhone specs were posted among friends on Facebook and the specs received poor feedback, which magnified critics reviews. How can Apple account for word of mouth that could change the product launch environment? The challenge now is to predict the unpredictable in a new market environment.
Understanding brand today Before defining the way a brand works, it is necessary to understand the role of the brand and brand strength. The role of brand explains what percentage of any purchase decision is attributable to the brand. It is a measure of the influence brand has on customer demand. This understanding informs decision-makers on how the brand is doing today. Brand strength, on the other hand, is a series of benchmarks that measure a brands ability to secure ongoing customer demand (choice, repurchase, retention). Together, the role of brand and brand strength provide managers with the knowledge to understand the future outcomes of marketing decisions made today. When incorporated with current computing and analytics capabilities, the combination is no longer just informed speculation. Rather, it offers measurable scenarios that can provide insights that lead to courageous decisions. If you type brand management in the Google search box and follow the link to the first definition available, this is what appears: Branding seeks to distinguish your company, product or service from the competition and create a lasting impression in your prospects mind. (www.1000ventures.com) Given the relevancy scores that Google is presumed to obtain 90 percent it is safe to assume that this definition is the common understanding of brand management.
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A new paradigm Many marketers today unnecessarily constrain themselves by saying, You can only optimise what you know. With todays consumers riding on waves of unobserved and hard to track patterns, new tools are needed to provide a future-looking perspective on brand-related value creation. The breakthrough in measurement will come in agent-based modeling (ABM). An agent-based model is a computational model for simulating the actions and interactions of autonomous individuals in a network. It is capable of assessing an individuals effects on the system as a whole by combining elements of game theory, complex systems, emergence, computational sociology, multi-agent systems, and evolutionary programming. Monte Carlo methods are used to introduce randomness. The models simulate the simultaneous operations of multiple agents, in an attempt to recreate and predict the actions of complex phenomena. The process arises out of a multiplicity of relatively simple interactions. The tool not only captures the efficiency requirements of media models, but also accounts for emerging forms of behavior that fuel innovation. Currently, it is being applied to forwardlooking business decisions.
Agent-based modeling has already enabled: US healthcare provider to accurately predict the A adoption of a new plan among seniors global sports organisation to launch a rebranding A campaign that creates free buzz n automotive company to effectively reduce A incentives while growing market share major consumer goods retailer to lower store A size 30 percent and increase sales The future Media mix optimisation drives cost management, which can help meet the street, but often sacrifices investment in new revenue streams. Discrete choice modelling can evaluate changes in the know. Although both offer insights into brand, neither delivers on the imagination required to generate growth for brands. In the end, revenue sustainability is the hallmark of a good brand. Its strength lies in its ability to protect future earnings during down markets and unlock value where brand can play a role.
There is no better time than now for strong brands to understand models that uncover the hidden behavior behind these new revenue streams.
Seemingly disparate groups of information become value creating segments
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Planning your touchpoints to accelerate profit by Rune Gustafson

The brand ultimately engages customers (or any other stakeholder) in many different ways, be it through advertising, product, packaging, and its people. Each contact or touchpoint builds up an experience that endures well beyond the product or service. It defines and reinforces the perceptions that customers have about the brand. Conversely, it is equally powerful at defining negative perceptions of a brand. For service businesses, touchpoints are often time-based and are perishable experiences that increase reputation risks. But touchpoints also provide a golden opportunity to create a powerful moment of intimacy through staff-customer interactions. Shifting these perceptions is the crucial foundation to staying closer to current customers and engaging new customers to try your brand for the first time. These deliver increased revenues and margins that accelerate brand value and profitable growth for investors. Nordstrom targets a single touchpoint Nordstrom, the US retailer, has dominated its market though the service it delivers to its core customers. It has proven that customers will pay a higher price for a superior service. In so doing, this helps to differentiate it from low-price discount brands (Nordstroms sales per square foot are twice the industry average). The service differentiation is delivered though the belief that, at all times, the most important person in the entire business is the customer. It counter-intuitively achieves this not with a biblical service manual but with a single rule: Use your good judgment in all situations. This is followed by, There are no additional rules. Nordstrom recognises that building customer relationships is done one customer at a time. Nordstrom shares fantastic relationship-building stories throughout the organisation to illustrate and train everyone about what its service ethos of going the extra mile means in practice. For example, a customer who was at its Chicago store searching for a black bow tie told this story: I was going to a black-tie party, and needed a ready-made bow tie. Nordstroms didnt stock one, but the guy there said, If you have ten minutes, how about I teach you how to tie one? And, in the middle of a busy Saturday afternoon, he did just that and got the sale. I was happy, I recommend them to everyone, and I still tell the story ten years later. Clearly, the power of a great service ethos can generate sales, great relationships and great word of mouth marketing. But the most important lesson marketers can learn from Nordstrom is that it invests primarily in a single touchpoint. Of course, its stores are clean and well designed, but its focus is on the staffcustomer touchpoint. Every CEO and CMO knows that they must invest in their brands experience. But the question that haunts them is: Which touchpoint is the driver of purchases and which ones are simply nice to have? Early thinking on touchpoints was based on satisfying each contact to a better level than your competitor. This approach is highly ineffective and reduces business performance because it follows four classic touchpoint management mistakes.
Biography: Rune Gustafson is Chief Executive Officer of Interbrand in London. Rune leverages his extensive experience in brand and retail propositions to regularly contribute to publications and conferences throughout the UK and Europe.
We continually observe that the most successful brands strive to put the brand at the heart of their business. They understand that, by using the brand as a central organising principle, they can direct every single business function, from HR and Distribution to Finance. In doing so, they are able to deliver a truly holistic brand experience that runs through the organisation and then outwards, thus engaging the customer.
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Classic touchpoint Fact-based touchpoint Making bolder, factmanagement mistakes strategy based investment decisions
01 Targeting too many customer segments Businesses often try to appeal to the widest possible audience. But without defining a narrow, attitudinally based audience, the touchpoint experience will be fragmented and often results in conflicting perceptions. 02 Dilution of the brand investment across too many touchpoints There are literally hundreds of possible touchpoints and no brand in the world has the time or resources to deliver each contact to the highest level. 03 Competing on basic factors only In an increasingly competitive environment, classic benchmarking activities ensure that brands copy each others differentiators resulting in a zero sum game. They are mistakenly all trying to compete on best practices rather than boldly challenging convention. Those that do, like Virgin or Disney, have been able to create an unassailable differentiation with their chosen target customers. 04 Relying on customer myths to prioritise choices The leading brands demonstrate that they have the leadership mindset to make hard choices and prioritise customer segments, touchpoints and investments based on facts rather than perceived wisdom.
The only way to develop a touchpoint strategy that will increase business performance (and avoid these four mistakes) is with a fact-based, analytical approach. InterContinental Hotels is an excellent example of a traditional brand that has re-invigorated itself by developing a new brand positioning and executing it perfectly by embedding it in the customer experience and offer. It used a sophisticated statistical Return on Investment (ROI) model designed to identify where and how to invest in the customer experience. First, it identified a narrow target audience that had a clear attitudinal preference for luxury travel experiences that enriched their life and provided them with the additional social currency of local knowledge and stories. Then, InterContinental cleverly used the statistical model to identify which specific parts of the customer experience truly drove them to choose InterContinental and, as a result, strongly increased their satisfaction. This provided the Executive Board with the clear evidence of what drives revenues and margin. It also identified areas of cost saving; parts of the experience (and costs) that could be removed without affecting their customers satisfaction. Its new positioning is the hotel brand that is In the Know and delivers exactly what its guests value without the things they dont value. Guests benefit from the authentic, insider knowledge about the places they visit. They are prepared to pay a premium (and stay more frequently) for gaining this social currency and the priceless stories they could share with their family and friends. The challenge was to educate and motivate large numbers of migrant or part-time staff employees to deliver on this promise consistently around the world. It was a fundamental shift to move from hiding the staff to making them the heroes and encouraging them to interact with guests. For employees, this new positioning was translated into an insider knowledge program for staff. It used the phrase, To you its just a walk to work; to our guest its a great view of local culture to educate and empower all their staff to share their local knowledge with guests.
The InterContinental Executive Board boldly decided to invest heavily in its staff as its primary touchpoint, with the statistical knowledge that this would deliver the highest ROI. In fact, it would provide almost double the ROI compared to any other touchpoint. Had it made many of the classic touchpoint mistakes outlined above and invested too little in too many touchpoints with too many customer segments, it would certainly not have achieved such strong business results. InterContinentals brand has revived in the year following the 2006 rebrand. There was an increase in positive brand perception of 10 percent and an increase in revenue per room of 12 percent (source: IHG.com). The success of this rebranding was the ability of the business to put their brand positioning, In the Know, at the heart of their operations and translate this into a valuable touchpoint. In a world where consumers are bombarded by multiple messages every minute and internal investment is increasingly scarce, there is an unequivocal case to be made for drastically reducing the number of touchpoints and investing strongly in a single touchpoint that accelerates brand value and profitable growth. This naturally raises the following critical questions for every CEO and CMO: ow do you currently measure the ROI H of your touchpoints? hich touchpoints can you live without? W hich touchpoint can you truly own W that differentiates your brand? hich touchpoint actually drives W your profits?
Each contact or touchpoint builds up an experience which endures well beyond the product or service.
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The Interbrand approach to valuing brands

Criteria for consideration
Using the Australian Stock Exchange (ASX) 200 list of Australias largest publicly traded corporations, and drawing upon more than 30 years of consulting experience, Interbrand formed an initial consideration set of eligible brands. All were then subject to the following criteria that narrowed candidates significantly: The brand must have originated in Australia. Hence, foreign-owned brands operating in Australia are excluded, e.g. Coke, McDonalds, Nike and Ford The brand must be Australian owned. Similarly, once Australian-owned but now foreign-owned brands have been excluded, e.g. Holden, Vegemite, Arnotts and Speedo There must be substantial publicly available financial data The brand must be a market-facing brand The Economic Value Added (EVA) must be positive. If a brand is reporting negative earnings, it can be difficult to derive a brand value for the brand, unless strongly positive forecast earnings are projected It is critically important that we are able to identify the brands total financial performance, including revenues, profit and asset base
Methodology
The Interbrand method for valuing brands is a proven and straightforward formula that examines brands through the lens of financial strength, importance in driving consumer selection, and the likelihood of ongoing branded revenue. Our method evaluates brands much like analysts would value any other asset: on the basis of how much theyre likely to earn in the future. There are three core components to our proprietary method, as follows. Financial analysis Our approach to valuation starts by forecasting the current and future revenue specifically attributable to the branded products. We subtract operating costs from revenue to calculate branded operating profit. We then apply a charge to the branded profit for capital employed. This gives us economic earnings. All financial analysis is based on publicly available company information. Interbrand culls from a range of analysts reports to build a consensus estimate for financial reporting.
Role of brand analysis A measure of how the brand influences customer demand at the point of purchase is applied to the economic earnings to arrive at Branded Earnings. For this study, industry benchmark analysis for the role the brand plays in driving customer demand is derived from Interbrands database of more than 5,000 prior valuations conducted over the course of 20 years. In-house market research is used to establish individual brand scores against our industry benchmarks. Brand strength score This is a benchmark of the brands ability to secure ongoing customer demand (loyalty, repurchase and retention) and thus sustain future earnings, translating branded earnings into net present value. This assessment is a structured way of determining the specific risk to the strength of the brand. We compare the brand against common factors of brand strength, such as market position, customer franchise, image and support.
Financial Analysis
Forecasted current and future revenue specically attributable to the brand
Brand Value Calculation
Role of Brand Analysis
A measure of how the brand inuences customer demand at the point of purchase
Role of Brand Analysis
Brand Strength
A benchmark of the brands ability to secure ongoing customer demand (loyalty, repurchase, retention).
Year Brand Revenues
Year
Year
Year
Year Brand Strength Analysis = Discount Rate

BRAND VALUE
Economic Earnings Brand Earnings
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Top line industry stories by Lynton Pipkorn
Australian brands continue to grow despite difficult times

The past decade has been a boom for Australian companies, with revenues and profits showing extraordinary growth. In line with this growth, Australian brands have continued to strengthen and prosper, and the aggregate value of the top 10 Australian brands is now worth approximately A$ 43 billion. Over the past decade, the Australian economy has experienced robust economic growth, buoyed by the expectation that revenues and corporate profits will grow across all industrial sectors. With near full employment, businesses and consumers have exhibited confidence in spending and investment, propelling the performance of many brands to new heights. More recently, however, the Australian economy has faced a number of challenges. The fall out of the sub-prime mortgage turmoil and ongoing global financial crisis, the rise and subsequent sharp fall of the Australian dollar, and the volatility in fuel, materials and raw commodity prices have all
hit home. As a result, a number of Australian companies have battled significant writedowns, rising input costs and adverse foreign exchange conditions, all of which have put significant pressure on profitability and the performance of their brands. For the first time since the early nineties, Australia is feeling the effects of a recession. However, while a number of challenge remain, interest rates are now at their lowest point in many years and inflation appears to have stabilised. As we battle the global recession, the challenge for Australian brands will be to re-evaluate what they understand about their customers. They must apply these insights into consumer motivations and brand perceptions to position their brands to respond to these changes in business and consumer sentiment. This can only stimulate demand and build corporate value in the years ahead. It is also prudent to recognise that total company values in relation to market capitalisation are declining in the short-term due to high levels of volatility. However, well-managed brands are stable assets in terms of brand value, and those that have positioned themselves for the long term should be the first to prosper when the economy begins to show the first signs of recovery.
Biography: Lynton is Interbrand Australias Brand Valuation and Analytics practice head. Lynton is responsible for valuing brand assets and managing the strategic outcomes resulting from valuation and analytics projects for clients. His previous clients include Qantas, Nab, VISA, MLC, PwC, Bank of New Zealand, Gazprom, National Foods, Nestl and Nokia.
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The emergence of private equity

In recent years, private equity has begun taking ownership and controlling stakes in key brands. Brands that exemplify this trend include Myer, Nine Network, Seven Network and Repco. With the exception of Myer, private equity purchases have resulted in significant restructures of a number of businesses, meaning their financials are no longer available or company structures are no longer comparable to analyse for the purposes of this study. Brands such as Channel Nine and Channel Seven have been subsumed by complex company ownership and reporting structures, making it difficult to access and isolate key valuation and financial inputs required to create the Best Australian Brands study.
The highly publicised bankruptcy of Lehman Brothers and the threatened insolvency of major banking and financial services brands such as Northern Rock, AIG, Royal Bank of Scotland, Citigroup and Merrill Lynch triggered a significant crisis of confidence with lenders and consumers, forcing the Australian Federal Government to guarantee the savings of all deposits under A$ 1 million. Notwithstanding the fallout of the credit crunch, the four major banks continue to retain prominent top 10 positions in the Best Australian Brands study. CBA remains the number one banking brand, while St. George has entered the top 10 for the first and perhaps the last time. The combined value of the four major banks is worth A$ 20.1 billion, almost half the value contained in the top 10. In 2008, the Bendigo and Adelaide Bank merger marked the first major change in the structure of the Australian banking industry. Since then a number of other regional and smaller brands have expressed plans to merge as a result of domestic and international pressures. Commonwealth Bank, with the acquisition of BankWest and 33 percent of Aussie Group, has consolidated its place as Australias largest financial institution. St. George, before the merger announcement with Westpac, was looking to challenge the big four dominance. Now, as a combined dual-branded organisation, the merged entity should create one of Australias largest tier one banking and finance groups. The financial crisis has also hampered the performance of a number of Australian banks. In particular, ANZ and NAB both face a number of bad debt write-downs, and the Federal Governments bank deposit guarantee has caused a flight of capital from the non-bank sector. The higher cost of lending has also impacted the non-bank lending sector, which saw Westpac swallow Rams Home Loans in 2007 and Commonwealth Bank take a 33 percent stake in Aussie Group in 2008. It is anticipated that further consolidation in the sector will continue, with Wizard being the latest brand to be acquired by Aussie Group. As the banking and finance market continues to suffer, brand portfolio management will become a greater challenge for a number of companies.
Nevertheless, despite the financial crisis, Australian banks are among the best capitalised and highest rated in terms of credit quality, and they continue to reinforce their reputation as some of the strongest banking brands in the world. Macquarie Group, one of the ranking standouts, has exhibited considerable growth and resilience with its innovative investment banking model. The model provides significant opportunity for expansion of the brand into new financial products and overseas investment markets. Local challengers Babcock & Brown, Allco Finance Group and MFS (re-branded Octaviar) have not proven as resilient.
Retailing
Banking and finance
The Australian retail sector, including a number of major department store and grocery brands, has also undergone significant changes. The performance of the sector has generally been very robust. However, more recently, profit forecasts have been hit by a collapse in consumer sentiment and the revised 2009 - 2010 economic outlook. Coles Myer has been disbanded, now that Myer has been purchased by private equity, and the remainder of the Coles Group business and associated brands have been sold to Wesfarmers. Woolworths has gone from strength to strength, capitalising on the management and ownership changes of its major rival, while also taking the opportunity to re-craft its visual identity and solidify its superior brand proposition. David Jones has made great strides amidst the turmoil of the Coles Myer divestiture. It is now enjoying the spoils of consistent investment in its store footprint and environment, and it is securing key premium and luxury brands to cement its leading position as the House of Brands for Australian department store shoppers. The effective use of Australian supermodels Megan Gale and Miranda Kerr has also reinforced David Joness premium brand positioning in the ongoing Australian department store wars.
The Australian banking landscape has undergone considerable changes in the past decade, with the sector exhibiting strong growth and robust operating conditions. However, as we head into a deepening global economic downturn, we have seen a flurry of activity connected to the extraordinary events of the sub-prime meltdown and the resulting global financial crisis. The retail commercial banks have suffered their first collective profit fall in 15 years with pre-tax profits down by 23 percent in 2008. The tightening of credit and the continued rationalisation in the banking industry is anticipated to create further adverse operating conditions. In this context, the marketing messages from the major banks were quick to reflect the changing consumer and business sentiment from growth and wealth creation to security and preservation by shifting their positioning to safety and a return to conservatism in the long term.
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Like Coles, Myer is currently in a turnaround phase and is expected to challenge its major rival David Jones with profit in 2007 up 40 percent after a number of years of underperformance. Myer has fought to maintain its quality positioning, with a focus on youth and a broadening of its product offer to encourage mainstream appeal. The consumer retail sector, however, remains under considerable pressure. As levels of consumer demand continue to deteriorate, the shift to provide greater value to consumers will be key to David Jones and Myer maintaining growth. To do so without compromising the premium positioning that distinguishes them from the likes of Target and smaller high street retailers will be just as critical to their continued success. The Best Australian Brands table has also seen the emergence of JB Hi-Fi and the continued dominance of home appliance and electrical goods retailer Harvey Norman. A high Australian dollar and continued marketing support of the brand during the past four years have seen Harvey Norman expand aggressively both in Australia and overseas. Its profits reflect consumer desire for the latest in electrical goods, advancements in computer technology and the affordability of imported households items. Harvey Norman, like all retailers, continues to face the stress of the economic downturn and must continue to build the value proposition of its offering to customers. JB Hi-Fi, a newcomer to the Best Australian Brands table, has proven a surprise competitor to Harvey Norman. Its brand positioning as a discount but expert music and electrical goods retailer has insulated the brand from the harshest affects of the slowdown. Stretching the brand, from music and MP3 players into home entertainment, and continuous expansion into other household goods has also widened its appeal and mitigated some earnings risk. JB Hi-Fi sales rose by an impressive 43 percent to A$ 1.8billion in 2008. After an impressive first half in 2009, there is further profit growth forecast despite the deterioration of consumer sentiment and the potential that Australia may enter a period of recession.
Airlines and travel
Television media
The airline industry is tough and volatile. Qantas, Flight Centre and Virgin Blues fortunes have all been heavily reliant on the previously buoyant domestic and international economic conditions. Due to the difficulties in accurately assessing the brand value of airlines based upon publically available information, Qantas, Jetstar and Virgin Blue have been excluded from financial analysis in our study. Nonetheless, Australian airline brands play an important role and we have included them in our commentary. In recent times, we have seen the industry recover from global security and health threats. Combined with a strong local economy, this has propelled the expansion of the business and leisure travel markets. Previously buoyed by a rise in the Australian dollar, the industry has benefited enormously from increased discretionary spending. Qantas has been able to capitalise significantly on its dual-brand strategy in this period. Now Qantas plans to withdraw from the NZ domestic market, but will instead launch Jetstar with a fleet of new A320s, flying more routes than Qantas was servicing in competition with Air NZ and Pacific Blue. Jetstars low cost base could well place extreme pressure on the other carriers. The introduction of new-to-market brands Jetstar, Tiger and V Australia has also created more options for Australian domestic and overseas travelers, resulting in an increase in routes and a reduction in fares. The rise in competition has driven a visible differentiation, creating a clear low, middle and premium segmentation to service the needs of consumers. Qantas has since overhauled its first and business class lounges, and modernised its fleet with the acquisition of new Boeing 787s and Airbus A380s designed to improve patronage and reduce long-haul fuel costs. Qantas has also revitalised its visual identity through a rebrand to complement these investments in premium travel facilities. At the height of the oil spike in 2008, high fuel prices worked to decimate Virgin Blues profit, which was down 55 percent from 2007. Qantas was able to weather the storm with profit up by 44 percent, and holiday and travel services provider Flight Centre improved by 38 percent year on year.
Australias three large commercial networks have undergone significant changes in their structure and operating environments. In particular, the Nine Network is no longer under the control of the Packer empire. Its Publishing and Broadcasting Limited business was broken up and the majority of the media assets including the television stations sold into private equity through PBL Media. Similarly, the Seven Network has experienced major corporate structural change, with Seven Media Group formed in a joint venture with private equity to house its television, magazine and internet interests. Media fragmentation, technological advances and the changing viewing habits of mass audiences have drastically altered the way people consume information and, specifically, advertising and brand communications. The advent of online media and digital content, and the need to converge and integrate old media with the new have also created innovative partnerships linking Seven with digital platform Yahoo! and similarly Nine with Microsoft. Ten has continued with its strategy to target youth, while the ratings decline at the Nine Network has resulted in the Seven Network taking the coveted number one position. As consumer spending continues to slow, media industry cash flows are expected to follow suit as the reduction in advertising revenues begins to bite. The slowdown has already affected the earnings of one major network, with Network Tens profit falling by approximately 25 percent.
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2009 Rank Brand Sector 2009 Brand Value A$ Million
Telecommunications
9,700
Banking / Financial Services
7,100
5,100
4,800
Retail
4,600
Banking/Financial Services
3,200
3,100
Apparel
2,200
1,900
10
Retail
1,300
11
Postal and Logistics
900
12
Retail
760
13
Retail
670
14
Travel
630
15
Gaming
560
16
Manufacturing
500
17
Share Registry Services
380
18
Utilities
220
19
Retail
190
20
150
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Australias Best Brands 2009

1
9,700 A$m
2
CBA. The Commonwealth Bank of Australia (CBA) remains the number one bank brand in Australia. CBA has managed to not only hold off the competition, but continue to build their brand despite potential threats such as the slowing economy and ongoing pressure on banks due to the credit crunch. CBA has achieved outstanding results through its continued focus on delivering products customers want and a concerted effort by the brand to improve customer service. This is backed by a commitment of A$ 580 million over the next four years to upgrade its technology systems to improve efficiency and service.
7,100 A$m
While many of the banks struggle to find differentiation, CBA has sought to reposition itself and bring its service experience to life through the proposition Determined to be Different. With scale and a diversified business mix core pillars of the groups offering, in 2008 CBA bought the BankWest brand from HBOS as well as a 33 percent interest in mortgage broker Aussie. CBA continues to build its strong reputation with active involvement in the community via high profile sponsorships such as Cricket Australia, The Australian of the Year Awards and the Commonwealth Bank Foundation.
TELSTRA. Since the full T3 privatisation in 2006, Telstra has identified a large opportunity for future growth in the Australian telecommunication industry. Telstras vision is to build on and enhance its position as the leading full service telecommunications and information Service Company in Australia, as well as to expand its presence internationally. Telstra has forged a path for itself as the clear brand leader in many sectors. It is the only media and information services company in Australia that provides its customers with a truly integrated telecommunications experience across fixed line, mobiles, broadband, information, transaction, search and pay TV. Under CEO Sol Trujillos stewardship, Telstra has continued to exploit its scale advantage by creating and integrating partnerships with its sub-brands and various third parties, including handset providers, media partners and mobile retailers. This integrated effort forms the cornerstone of Telstras transformation strategy to move customers onto upgraded internet and wireless phone networks. Mobile advertising has significant future growth potential with the introduction of WAP and 3G phone services and the increasing demand for internet and data transfer services on mobile phones. Telstra reported that mobile service revenues grew 12.3 percent for the year, while mobile data growth shot up 44.1 percent. Rich content and data services form a key domestic and international revenue plank for the future. With ambitions to be seen as much more than just Australias largest telecommunications services provider, Telstra have the opportunity to impact the lives of all Australians in the wider cultural landscape, and deepening its influence by becoming a global telecommunications force.
3
NATIONAL AUSTRALIA BANK (NAB) is one of Australias largest banking and financial services organisations. NAB provides a broad range of comprehensive and integrated financial products and services through its various units. These include NAB with MLC in Australia, Bank of New Zealand, Clydesdale and Yorkshire banks in the UK, and NABCapital in its global institutional markets and services business. After the negative publicity generated during the trading and board scandals of 2004, NAB has aggressively sought to reposition the brand to counteract any lingering reputation and image challenges. In 2006, the new NAB brand identity was unveiled with a renewed focus to refurbish branches, retrain and engage staff, improve services and introduce new and more competitive financial services and products. Accompanying communications campaigns sought to breakdown even further the bureaucracy and previous negative associations in the bank, reflecting the brand journey of an organisation fighting back from adversity. These changes have allowed NAB to become more approachable, open and friendly
5,100 A$m
to staff, suppliers, government and consumers. Further reinforcing this re-positioning, NABs current A$ 32.6 million marketing expenditure involves major advertising campaigns such as Climb Evry Mountain and nab a small word for a big life have continued to build affinity with consumers. NABs investment in sponsorship with the AFL and 2006 Commonwealth Games also contributed to introducing NABs positioning changes successfully, engaging stakeholders and lifting its brand health measures. More recently, NAB has suffered a number of write-downs associated with its exposure to the global credit crunch, recording its first negative result since 2004, with the 2008 group result taking a substantial hit from a A$ 2.7 billion provision for bad debt. As economic conditions and financial markets continue to deteriorate and hamper the performance of all the major banks, NAB and its contemporaries will need to position themselves strongly for the expected tough times that lie ahead.
Telstras mobile service revenues grew 12.3 percent for the year, while mobile data growth shot up 44.1 percent.
17
4
WESTPAC has maintained its profile and reputation as one of Australias best managed and largest financial services companies. Remaining steady in the face of the global financial crisis, Westpac continues to increase its brand value through maintaining best practice in corporate social responsibility and its commitment to customer service. Offering extended hours and flexibility for its customers and staff, its brand-aligned culture, under newly anointed CEO Gail Kelly, will ensure that Westpac maintains its brand leadership and continues to grow in strength. Recognised as one of Australias best corporate citizens, Westpac has won numerous reputation awards due to its sustainability policies and corporate social responsibility practices. With the approved St. George merger expected to take shape in 2009, Westpac aims to continue to drive a strong
4,800 A$m
customer culture and implement compelling customer segment strategies. These will serve to continue to generate revenue and profit growth amidst a very different and challenging banking landscape. The credit crunch and changing conditions in the market have also impacted the key communications messages from the banks, prompting them to position their brands less aggressively around growth and more conservatively around safety, stability and security of deposits and preservation of investment in financial products. The St. George merger will service 10 million customers and create Australias second largest banking entity. Westpacs prudent reputations and AA rating will ensure it can maintain its strong position as the banking and finance industry faces further economic and financial headwinds in 2009.
Offering extended hours and flexibility for its customers and staff, its brandaligned culture will ensure that Westpac maintains its brand leadership.
5
WOOLWORTHS. Despite the economic downturn, Woolworths remains in pole position as Australias largest grocery retailer. CEO Michael Luscombe has built formidable market share and year-on-year sales growth. Woolworths continues to drive a wedge between itself and its major rival Coles as it tries to reinvent itself for the renewed challenge ahead. Woolworths not only has a strong management team and an excellent refurbishment strategy in place, but it also has the flexibility in its business model that other competitors do not, to counter the dual threat of an economic slowdown and the entry of foreign supermarket competitors. As the growth of IGA, Aldi and Costco continues, and the divesting of Coles to Wesfarmers progresses, retail supermarkets are now competing more aggressively, especially with the trend towards higher margin own label brand offerings. Woolworths Home Brand and Woolworths Select have
4,600 A$m
been a tremendous success in the private label segment, and store brands will play a greater role in generating revenues for the supermarkets during the downturn. Staple foods and basic commodities are also not expected to affect revenues, unlike the impact of the slowdown in more discretionary categories. A marketing budget of over A$ 100 million ensures Woolworths is well-poised to roll out its refreshed brand identity across all key customer touch points. Just as the Safeway brand is phased out in Victoria, Woolworthss ownership of the positioning of the fresh food people in this increasingly competitive retail environment, will only serve to reinforce its focus on its customers. Woolworthss new identity communicates positive values to customers with associations to fresh, simple, interesting and modern. All of this suggests a more positive shopping experience and a renewed focus on freshness and quality.
18
6
MACQUARIE GROUP is the preeminent Australian investment banking brand. Despite the financial crisis, the collapse of the investment banking system on Wall Street, and the plight of its local rivals, Macquarie continues to thrive through its brand mantra of innovation and the diversity of its business model and operating activities. This unique mix of business strategy, attracting and rewarding the best human capital, and access to financial markets has underpinned an extraordinary growth trajectory. The Macquarie brand has been built upon its expertise, strong relationships, unique product offering, and its rising status as a result of consistent performances in the financial services sector. The Macquarie brand communicates what it will deliver inspired and innovative solutions to difficult financial problems. In the last number of years, Macquaries success and its willingness to prove the doubters wrong has allowed it to mature into a global investment banking brand and diversified financial services group, providing banking,
3,200 A$m
financial, advisory and investment services to investors, corporations and governments. Macquaries strength and reputation has grown as a result of its ability to match its ambitions with an innate ability to deliver results and outperform sometimes much bigger and more established international investment banking rivals. Macquarie Group now has more than 60 office locations across 25 countries, and continues to establish itself as a venerable name amongst the investment banking elite in the worlds major financial centres. Macquarie Groups model has, however, come under some pressure as a result of deteriorating asset values due the de-leveraging of the global economy through the financial crisis. The test for Macquarie will be to leverage its hard earned reputation and leadership credentials in continuing to innovate, while consolidating the brand in the challenging and diverse markets it operates. Only time will tell if Macquarie Group can continue to withstand the banking and finances industrys greatest challenge.
3,100 A$m
The Macquarie brand communicates what it will deliver inspired and innovative solutions to difficult financial problems.
ANZ. Despite the global financial turmoil and the merger and acquisition activity of its nearest rivals Westpac and Commonwealth Bank, ANZ continues to pursue its long term strategy of organically growing its brand footprint into the Asia- Pacific region. Through an aggressive expansion in retail branches and via a number of joint ventures with Asian banks, ANZs push into the Asian market is perceived by some to be high risk. However, growing the brand internationally could provide ANZ with a major competitive advantage over its domestic rivals whose presence is not nearly as strong in the Asian market. Despite offshore risks, ANZ is still eyeing Asia as the source of 20 percent of earnings over the next five years after the division grew earnings by 52 percent in fiscal 2008. In order to support its strategy ANZ has invested in the highest share of voice of the big four, investing $46.6 million in marketing and advertising expenditure in 2007. Domestically, ANZ has been prominent in mortgage lending, securities, margin lending and institutional banking, however as the property boom recedes, and economic conditions generally deteriorate as a result of the credit crisis, ANZ has suffered its first profit fall since 1998. Furthermore, ANZs relationships with various securities lending clients and subsequent bad debt provisions have caused some harm to the brands reputation. In responding to the global financial crisis impacting on local operations, ANZ is actively looking to protect its image by applying a more rigorous and conservative approach to lending and in its application to risk management procedures in the future.
8
BILLABONG. The board sports clothing market has experienced phenomenal growth over the last decade. Billabong has successfully leveraged the brands heritage and place in Australias unique surfing culture to stretch into new customer segments, categories and geographies, becoming the worlds largest surfing and board sports apparel brand. Recent diversification of the product range into skate and snow categories will deliver a more stable platform for growth providing the strength to combat major rivals Quicksilver and Rip Curl. Billabongs consistent strategy of building credibility by sponsoring major sporting events and forging relationships with respected sports stars in the surf, skate and snow segments has also helped propel the authenticity of the brand across new generations. By moving the brands focus from the male-dominated surfing culture to board-sports inspired activities, innovative unisex lifestyle accessories and leisurewear, Billabong has been able to engage more diverse consumer segments and reinforce its position. A commitment to continual investment in
2,200 A$m
product design and innovation has also ensured that the brand has remained both relevant and contemporary. Billabong has also aggressively expanded internationally into North America and Europe, and it is now becoming increasingly popular in Eastern Europe in both urban and regional areas. It may need to manage its exposure to the US and emerging economies where growth is expected to slow, however, a lower Australian dollar will no doubt assist them in their quest.
19
1,900 A$m
10
1,300 A$m
11
900 A$m
ST. GEORGEs commitment to service, personal attention and the development of close relationships with customers is one of its main competitive advantages compared to the big four banks. These strengths include a track record of positive credit quality, high staff engagement ratings relative to the industry, and excellent product management and innovation capabilities. St. George also strives to play a positive role in the community by supporting charities, the arts, sporting clubs, business programs and disaster relief initiatives. While St. George and Westpacs merger will create one of Australias largest financial services companies for customers, shareholders and employees, the challenge post merger will be to ensure that the St. George brand maintains its unique positioning. It must continue to live up to its reputation as the friendly bank next door through its Good With People, Good With Money position. The strategy to be big but look small in the eyes of customers has been St. Georges key strength, with the brand claiming that superior customer service and a personal approach to business will remain as the St. George brand continues to operate as a separate brand entity. St. George also hopes to grow organically across Australia while harnessing the potential in its existing brand strengths and capabilities. The global financial crisis and the roll-on impact of a slowing Australian economy are also negatively affecting the banking market, with the ability to supply quality credit steadily deteriorating and threatening the long term viability of a number of smaller competitors. Now that St. George is part of Westpac, and with consolidation expected to continue in the banking and finance industry, to sustain its growth ambitions it will be more important than ever for St. George to keep its unique identity and not be seen by consumers as just part of the big four.
HARVEY NORMAN. The previously high Australian dollar, the explosion in popularity of personal media devices and the adoption of digital TV have driven consumers to electrical goods retailers in their droves. A commitment to stock the highest selling brands and a successful franchise strategy has enabled Harvey Norman to grow revenues and increase market share to become Australias dominant consumer electronics and homewares retail brand. Harvey Normans comprehensive product mix, strong customer value proposition and aggressive marketing and communications support have consistently delivered superior brand performance across the wider market. However, the falling Australian dollar and the economic slowdown have affected the forecast outlook for Harvey Norman. As a well-known counter-cyclical advertiser, typically increasing ad spend during times of slowdown in order to gain market share, Gerry Harvey has revealed he is to cut his A$ 300 million marketing and advertising budget by at least 20 percent and he is to close a number of under-performing stores. All this could spell harder times ahead for the retailer.
AUSTRALIA POST. A flexible and diverse business model has allowed Australia Post to address the threat of electronic communication and declining traditional post volumes by focusing on growth from the globalisation of small business. By staying at the forefront of innovation in the post and logistics industry, Australia Post has been able to maintain its brand leadership in Australia and fend off the threat of larger global business logistics competitors. At the same time, Australia Post has also broadened the scope of its offering. With the acquisition of Star Track Express, Australia Post has expanded its non-core services and continued to enjoy strong results. Post Logistics has emerged as another source of high growth for its B2B services division. However, the collapse of Australia Posts extension Post Bill Pay damaged the brands credentials in the internet services market. As a ubiquitous brand in Australia attempting to modernise its persona, the recent Part of Everyday campaign has positioned the brand as more contemporary and relevant, breathing new life into the Australia Post brand.
12
DAVID JONES has reinforced its position as Australias premium department store brand. The brand has achieved this position via an unwavering focus on supplying high calibre branded products, providing excellent customer service, and consistently communicating its first class status and leading reputation for quality. Through this strategy, David Jones has built higher margins by offering exclusive supply deals with premium brands and by investing in current and new stores to create a more luxurious retail brand experience. To consolidate its position, the retailer has successfully established exclusive supply agreements with over 50 new brands, some of which were
760 A$m
previously stocked at major rival Myer. The use of Australian supermodels Megan Gale and Miranda Kerr as David Jones brand ambassadors has also reinforced David Joness credibility and premium brand positioning in the ongoing Australian department store wars. David Jones has dominated the competitive retail environment in recent years and it has delivered strong year on year store sales growth. With the Australian economy experiencing an economic downturn, it will be challenging for David Jones to sustain such high historical growth, however, the brand is well positioned to maintain its leadership status.
The strategy to be big but to look small in the eyes of customers has been St. Georges key strength.
20 Best Australian Brands 2009
13
MYER is Australias largest chain of department stores, retailing a broad range of merchandise. The implementation of an integrated media strategy that includes the distribution of catalogues and a magazine has brought together brand touchpoints and advertising campaigns into closer harmony. The Myer is my store byline is the current campaign driver and this campaign stretches across all aspects of Myers media spend, in line with Myers strategy of providing a range of products to suit everyones needs. This has been extended through point of sale, in-store signage, direct marketing, and sponsorships. Myers brand position in the market was deteriorating under the previous management of Coles Myer, however the divestment and takeover by private equity has heralded a renewed focus on the core business and a return to profitability. Currently, Myer is in direct competition with both high end and
670 A$m
14
630 A$m
discount retailers, operating 65 stores across Australia. Former Miss Universe Jennifer Hawkins has successfully led Myers most publicised promotional activity since 2006, and she recently signed a multi-million- dollar deal to be the face of Myer for another four years. Although Myer has delivered a more efficient business model and begun to invest and reinvigorate key retail stores, Myer has been unable to defend against David Joness aggressive pursuit of growth and positioning at the premium end of the market. With a retail downturn underway, Myer is set to counter the drop in consumer spending by doubling its marketing budget for the first three months of 2009 in a multi-million-dollar bid to drive traffic to stores. With the competitive environment in the department store wars set to get tougher, it shall remain an intriguing battle.
FLIGHT CENTRE. Unpredictable events such as threats to global security, rising oil prices, economic volatility and fluctuations in exchange rates have always hampered the global and domestic travel industry. However, Flight Centre has continually emerged from these threats to be the leading provider of travel solutions through its commitment to demonstrating its lowest airfares guaranteed value proposition alongside its flexible and responsive business model. Flight Centre was quick to recognise the movement of customers researching and paying for travel services on the internet. As consumers migrated online, Flight Centre has capitalised on the growth of its customer base in Australia and overseas through an innovative combination of retail and online brand strategies. Extensive employee training programs have resulted in Flight Centre becoming an employer of choice, voted as one of the best 100 places to work. Its A$ 2.4 million investment in adventure travel brand Intrepid has allowed it to enter the niche travel sector, and its partnership with the Nine Network and Getaway has contributed to its position as the number one travel agency brand in Australia. With the global slowdown expected to impact on revenues in the highly sensitive and volatile travel industry, Flight Centres dedication to quality, value and innovation will put it in a good position to continue to outperform its sector.
15
CROWN. Since 2004, Crown has enjoyed strong growth and a generally buoyant economy in Australia. However, economic slowdown may affect the profits of the gambling and luxury accommodation industry in the short to medium term, with the James Packer-led Crown Empire no exception. The worsening conditions of the global economy are expected not only to affect local customers but also the highly lucrative Asian market. However, Crowns major events schedule, expanding entertainment offerings, exclusive high
560 A$m
roller positioning and continual upgrades aim to attract both local and international customers. Some of these upgrades include Crowns refurbishment of the main gaming room, three first-class restaurants, and a third hotel and conference centre. Crowns continuous improvements also include an investment into A$ 2billion worth of U.S. casino and gaming assets. Crown has successfully positioned its brand around entertainment and leisure, avoiding the pitfalls associated with gambling and other related social problems.
Flight Centre has capitalised on the growth of its customer base in Australia and overseas through its innovative combination of retail and online brand strategies.
21
16
500 A$m
17
COMPUTERSHARE. A dominant position in Australian share registry services has given Computershare clear leadership on products, technological innovation and performance. With the Australian market for investor services now only accounting for a fraction of its revenue, Computershare has leveraged its brand leadership in registry services and aggressively pursued acquisitions internationally to become a global player and position itself as a specialist technology solutions provider. Emerging markets are a source of strong growth, with Russia a key standout where Computershare has solidified
380 A$m
ANSELL is a recognised worldwide leader in branded latex and rubber products, supplying a diverse range of business and consumer markets. After strong margin pressure from high latex prices, Ansell has leveraged its strong brand position and diversified the brand into new categories such as non-latex protective wear while shifting towards a more premium offering in its professional division and consumer rubber glove ranges. Recent acquisitions in the US condom market have been unable to make a substantial imprint on revenues as yet, however, Ansell has entrenched its status as market leader in Australia after fending off an increase in competition locally. Operating in increasingly mature markets, Ansell has pursued new growth in emerging markets in Asia, Eastern Europe, and South America to leverage its brand strength in key latex supply markets. As a result, the brand has generally enjoyed robust performance since 2005.
itself as the market leader. In conjunction with share registry management services including corporate actions, shareholder relations management, employee share plans and electronic investor communication, Computershare is now able to provide total share transaction settlement services. This shift towards a total client solutions model has great potential and is a core proposition for the brand. Given the recent downturn in global share markets, this provides the platform from which Computershare can build even further on its attributes of efficiency, trust and security.
Computershare has leveraged its brand leadership in registry services and aggressively pursued acquisitions internationally to become a global player.
18
ORIGIN ENERGYs authentic green brand credentials place it in an enviable position to accommodate an increasingly environmentally conscious retail energy market. Origin is highly active in distributing and developing renewable and environmentally friendly energy solutions, with interests in solar energy, wind power and geothermal energy production. With the second largest market share in a fiercely competitive energy and utilities landscape, Origin has been able to differentiate itself with its sustainability credentials, yet the threat of imitation by competition remains.
With the second largest market share in a fiercely competitive landscape, Origin has been able to differentiate itself with its sustainability credentials.
220 A$m
In terms of pricing, the traditional coal and gas fired energy market has experienced volatile wholesale prices in the past few years, however, Origins integrated supply chain has enabled it to ride out the storm. The most recent Things we love campaign brings to life the companys desire to operate its business in a way that ensures the things we love today will still be here for us to enjoy in the future. This campaign aims to set Origin apart as a brand leader in the energy industry and communicate its commitment to the brand promise.
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JB Hi-Fis mix of high selling products, quality service without the attitude, and pared-back store environment combines to create an authentic value proposition that is very popular among consumers.
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190 A$m
JB Hi-Fi has emerged as one of the high performers in the music retailing and consumer electronics category. Despite worsening economic conditions in retailing, JB Hi-Fi has demonstrated the extraordinary strength of its brand in the past year. Its mix of high-selling products, quality service without the attitude, and pared-back store environment combines to create an authentic value proposition that is very popular among consumers. JB Hi-Fi continues to gain market share on the back of this best-in-category business model, and it will press ahead with the roll out of 24 new stores, as well as a planned aggressive expansion into New Zealand. Shifting towards consumer electronics has increased the competitive pressure from the likes of category leaders like Harvey Norman, however, the JB Hi-Fi brand has continued to take share as it stretches into these core categories. The brands authentic value proposition and the staffs instinctive ability to make a sale should place the brand in a strong position to tackle the downturn.
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BENDIGO AND ADELAIDE BANK. Bendigo Banks value continues to rise due to continued organic growth and its A$ 1.6 billion merger with Adelaide Bank in 2007. Bendigos market share has been largely driven by the publicity surrounding its community bank positioning and by growing its suite of innovative financial services options. The consolidation of both Bendigo and Adelaide Bank should prove to be a successful union with consumers due to the positioning of both institutions as community banking brands with solid financial services offerings. Given St. Georges acquisition by Westpac, Bendigo and Adelaide Bank have the opportunity to position themselves as the leading independent community bank that engages with local communities. The fact that
150 A$m
Bendigo and Adelaide Bank has also held the highest level of customer satisfaction in the local banking sector will also serve to increase market share. The strengths of the partnership will include a stronger wealth management business, larger retail network, increased margin lending capabilities, and a continued push towards the SME banking segment. With a demonstrable commitment to communities with various arts, sports and charitable foundations, the emergence of Bendigo bank to use the Olympics as a brand building opportunity signals their intent to grow their national deposit base. Bendigo has about 400 branches and through the merger now has a greater ability to leverage brand investments to contend with the big banks to win customers.
Bendigo and Adelaide Bank have the opportunity to position themselves as the leading independent community bank.
Other prominent Australian brands

A number of strong and well-performing brands were not featured in the ranking, but they nevertheless play a significant role in the Australian brand landscape. We dedicate this section to other prominent Australian brands that came close to making the Top 20 table or were unable to be included.
QANTAS is the worlds second oldest and Australias largest airline with 51 percent value share in the domestic air transportation industry. Qantas also continues to build on a strong position in Australasia and in key strategic markets in Asia-Pacific and Western Europe. Despite a potentially disastrous dalliance with private equity in 2006, the airline is in comparably strong shape versus many of its international and domestic peers, bolstered by a solid cash position and a revitalised fleet. Qantas has also been consistently responsive in meeting volatile and uncertain market conditions while delivering a highly successful dual brand strategy with Jetstar. 2007 also marked the year of brand renewal for Qantas, with the airline unveiling a new identity to complement its new fleet of state-of-the-art Boeing 787 and Airbus A380 aircraft. The Flying Kangaroo, as it is affectionately known, has also unveiled
new, more spacious seating, enhanced interiors, lounges designed by Marc Newson, luxurious first class check-in facilities, and a new flying experience courtesy of the premium economy cabin. Through continual support of the brand and investment in its capital base, Qantas is making a genuine effort to stay relevant and maintain its long-term growth strategy despite the economic downturn. The significant investment in its new fleet and its continual focus on its 5 million Frequent Flyer members is expected to boost customer loyalty and satisfaction. In 2008, the global airline industry drastically cut capacity as fuel prices rallied to record highs. However, as energy prices later retreated, pushed lower by the economic crisis that continues to dampen demand, Qantas is currently entertaining possible merger opportunities with rivals to exploit long-term cost, marketing and supply-synergy benefits.
2007 marked the year of brand renewal for Qantas, with the airline unveiling a new identity to complement its new fleet of state-of-the-art Boeing 787 and Airbus A380 aircraft.
24 Best Australian Brands 2009
NETWORK TEN. Although Network Ten has slipped to third in overall market share ratings, it has been able to maintain leadership in the coveted, yet hard to reach, 16-39 year old segment. Ten continue to pursue this targeted strategy and offer a clearly differentiated proposition to the market where programming is aimed at those audiences that are of most interest to advertisers. After enjoying an excellent run in popularity for local programming in the past few years, Big Brother has finally come to an end but Australian Idol, The Biggest Loser and So You Think You Can Dance are still holding up well. While the other
commercial channels have developed online partnerships with related entertainment companies, Ten has resisted establishing a more comprehensive service online. However, Ten has been proactive in addressing the opportunities presented by the multi-channeling capabilities of digital television, demonstrated by its first mover advantage with the new dedicated 24-hour free-to-air channel, One. This new sports programming platform will utilise a high integration advertising model to avoid dilution of revenue derived from the existing mainstream analogue channel.
Suncorp has focused on customer service to differentiate itself from its considerably larger Sydney and Melbourne peers.
SUNCORP is Australias sixth largest bank and a leading finance, insurance, and banking corporation. Suncorps acquisition of Promina in 2007 established the company nationally and gave weight to its model as a diversified retail financial services organisation. Although a pricing war on insurance premiums cut the performance of the insurance arm, the banking division has continued to grow with the relative buoyancy of the Australian economy up until late 2008 and the significant growth of the Queensland property market. Suncorp has focused on customer service to differentiate itself from its considerably larger Sydney and Melbourne peers, boasting 68 percent customer satisfaction compared to the big fours average of around 60 percent. The banking division has attempted to reduce its reliance on the Queensland market by expanding its presence in NSW, Victoria and WA to grab additional market share and become a super-regional bank brand. However, Suncorps exposure to the cooling Queensland property market has exposed the banks reliance on its home market and its performance in 2009 has suffered accordingly. Chief executive John Mulcahy has agreed to step down from his post after six years in the role. Due to the global financial crisis, falling asset values and access to the wholesale lending market continues to threaten the stability of Australias regional banks, with Suncorps long-term future currently uncertain.
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AGL. For energy providers like AGL the past number of years has seen significant change unfold in every area of the domestic gas and electricity market. New markets have opened and existing markets have evolved as the national grid was privatised and opened up to competitive energy wholesaling and retailing amidst a climate of volatile wholesale energy costs. In an industry where oil and gas prices determine profitability, AGL distinguishes itself through building its reputation, customer relationships, and reliability. With increasing competition and the upcoming privatisation of the NSW power network, AGL has continued to focus on downstream retail activity to build a point of difference in its brand for
a commoditised product, and it has grown its customer base to over 6 million to become Australias leading energy supplier. In 2007 and 2008 global energy prices increased significantly, while government and public pressure to improve sustainability and innovation into clean fuels and subsequent compliance with various emissions goals provided further incentive for more effective brand building activities. In early 2008, AGL launched its new retail brand campaign, Energy in Action, across a variety of media. This re-positioning highlights the actions AGL has taken in its renewable energy portfolio and positions AGL with its new brand and staff promise of Actions, not words.
Lend Lease has been very successful on a global scale, operating in more than 40 countries and employing more than 11,000 people worldwide.
LEND LEASE. Having come a long way from its original Dutch/Australian roots, Lend Lease is now Australias largest property management and investment company. The company has been successful on a global scale, operating in more than 40 countries and employing more than 11,000 people worldwide. In all markets, the Bovis Lend Lease division constructs and manages large building projects. In the Asia-Pacific region, Lend Lease also operates as Delfin Lend Lease, a major Australian residential property developer. In addition, Lend Lease also operates a retail development investment business in the UK, and a number of other ventures in the United States. With the re-pricing of asset values, a major symptom of the fallout in the global financial crisis, current volatility in the commercial property market is likely to continue for the foreseeable future. Last year, Lend Lease reported a 46.7 percent fall in its annual profit due to property revaluations and write-downs in the value of some of its UK businesses, as both the US and UK residential markets continue to suffer. Looking towards its future growth, Lend Lease is contracted to develop the A$ 13.2 billion Olympic village for the London Olympic Games. Not only will this make up for some of its lost profit, it will also create brand awareness and expand knowledge of its expertise in the international market.
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Answers to the most commonly asked questions

The purpose of this section is to address the questions that you might be asking in relation to the Best Australian Brands table.
01 What is brand value? 02 Why value brands? 03 How does Interbrand derive the value of brands? 04 What was the basis for the financial assessments? 05 What was the basis for the marketing assessments? 06 Why are certain brands not on the list? 07 Was there a limit to the number of brands included from any one industry? 08 What is the relationship between the following terms: brand awareness, brand equity, brand share, and brand value? 09 Do the valuations reflect the underlying state of the economy? 10 How does brand value rank against ad spending?
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11 Is it possible to recognise brand value on a balance sheet? 12 What is Interbrands view on brands appearing on balance sheets?
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28 13 Why is Interbrand an expert in assessing brand value? 29 14 Does Interbrand conduct other brand studies? 29 15 What is the difference between the valuations in Best Australian Brands and consulting valuations for clients? 31 31
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01 What is brand value? Brand value is the dollar value of a brand, calculated as Net Present Value (NPV) or todays value of the earnings the brand is expected to generate in the future. Like any other financial value, brand value is based on the assumptions and information available at that point in time. Brand value is calculated according to the most widely accepted and used valuation principles. This makes brand value comparable to businessand all NPV-based asset values. The valuations of brands appearing in the Best Australian Brands are calculated in their current use to their current owner. Therefore, these valuations do not necessarily represent the potential purchase, extension or licensing value of the brands.
03 How does Interbrand derive the value of brands? Our valuation approach is a derivative of the way businesses and financial assets are valued. It fits with current corporate finance theory and practice. There are three key elements and they are detailed below. Financial Forecasting We identify the revenues from products or services that are generated with the brand. From these branded revenues we deduct operating costs, applicable taxes, and a charge for the capital employed to derive the economic value that is generated by all tangible and intangible business assets of the branded business. Economic Value Added (EVA) is a value-based management concept and is a generally accepted principle to measure the ability of a business to generate returns over and above its invested capital. Based on reports from financial analysts, we prepare a financial forecast and calculate the EVA of the branded business. Role of Branding Since EVA includes the returns for all assets employed in the business, we need to identify the earnings that are specifically attributable to the brand. Through our proprietary analytical framework, called Role of Branding, we can calculate the percentage of EVA that is entirely generated by the brand. In some businesses, e.g. in fragrances or packaged goods, the Role of Branding is very high as the brand is the predominant driver of the customer buying decision. However, in other businesses (in particular B2B) the brand is only one purchase driver among many, and the Role of Branding is therefore lower. For example, people are buying Microsoft not only because of the brand, but because the company has an installed base of 80 percent of the market and it would be extremely difficult for most users to switch their existing files to a new software platform. In the case of
Shell, people buy not only because of the brand, but also because of the location of the petrol stations and use of loyalty programs. For each of the brands (and categories) we have assessed the Role of Branding. The Role of Branding is derived as a percentage (%). Thus, if it is 50%, we take 50% of the EVA as brand earnings. If it is 10%, we only take 10% of the EVA. Brand Strength To derive the net present value of the forecast brand earnings, we need a discount rate that represents the risk profile of these earnings. There are two factors at play: firstly, the time value of money (i.e. $100 today is more valuable than $100 in five years because one can earn interest on the money in the meantime); and secondly, the risk that the forecast earnings will actually materialise. The discount rate represents these factors as it provides an assetspecific risk rate. The higher the risk of the future earnings stream, the higher the discount rate will be. To derive todays value of a future expected earnings stream, it needs to be discounted by a rate that reflects the risk of the earnings actually materialising and the time for which it is expected. For example, $100 from the Coca-Cola brand in five years requires a lower discount rate than $100 from the Fanta brand in five years, as the Coca-Cola brand is stronger and therefore more likely to deliver the expected earnings. The assessment of Brand Strength is a structured way of assessing the specific risk of the brand. We compare the brand against a notional ideal and score it against common factors of brand strength. The ideal brand is virtually risk-free and would be discounted at a rate almost as low as government bonds or a similar risk-free investment. The lower the brand strength, the further it is from the risk-free investment and so the higher the discount rate (and therefore the lower the NPV).
02 Why value brands? The purpose of these valuations is to demonstrate to the business community that brands are very important business assets and, in many cases, the single most valuable company asset. We also aim to make branding and marketing key business issues that have direct shareholder value impact. Through eight years of publishing Best Global Brands in BusinessWeek magazine, we have created the worlds most significant and influential brand and marketing study. In fact, PRWeek magazine produced a study demonstrating that the BusinessWeek/Interbrand Best Global Brands ranking was the third most sought-after benchmark report by CEOs, CFOs and Marketing Directors.
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04 What was the basis for the financial assessments? Published annual reports were used to examine the revenues, earnings and balance sheets of the brandowning companies. Analyst reports from investment banks are used as the basis for identifying the specific brand revenues and earnings, and for forecasting future earnings.
06 Why are certain brands not on the list? This is a frequent question, especially from companies who would expect their brands to be on the list. The most likely possible reasons are as follows: he brand has a pure B2B audience T and little wider public profile and awareness here is insufficient level of public T financial data available to enable us to identify the branded business (e.g. the company has multiple brands, as in the case of Fosters, or has unbranded production) he brand is not big enough or profit T was insufficient t is not a customer facing brand - I holding companies were excluded (e.g. IAG, Wesfarmers) holly owned or local subsidiaries of W global brands were excluded on the basis that their value is not entirely rooted in Australia and/or they did not originate here (e.g. GM Holden, Arnotts, Kmart)
05 What was the basis for the marketing assessments? Unlike other brand value rankings, Interbrand does not rely on a single source of marketing information. Using a single brand study would limit the type of information (usually perceptual data) and the type of customer (usually general public) that can be considered. Because many leading brands operate in specific customer segments (particularly B2B brands), sourcing data exclusively from the general public would prove very restrictive. Instead, Interbrand refers to a wide array of primary and secondary sources, which are applicable to each brand. These include ACNielsen, IBIS World, Factiva, BRW, Thompson Reuters, Australian Financial Review, Adnews, B&T and Datamonitor, among many others.
07 Was there a limit to the number of brands included from any one industry? No. However, one of the requirements of a leading brand is that it is, in fact, leading. The mark of leadership is not just about market share, but also about behaving as a leader setting trends, quality standards, authority and so on. As a result, there are brands that are in the top three of their categorys market share but did not make the cut, and there are brands that are not top three that did make the ranking. The rules described are guidelines and, ultimately, each brand was assessed for inclusion on its own merits.
08 What is the relationship between the following terms: brand awareness, brand equity, brand share and brand value? Brand value is the only measure that looks at the economic benefit of the brand to its owner. In other words, it is an end in itself. Brand awareness and brand equity are a means to an end. Brand awareness is simply knowledge that a brand exists, thus brand awareness may prompt customers to consider buying a product. Brand equity is a measure of customer perceptions of a brand, thus it may give a customer reason to prefer one product over the alternatives. Brand share is simply the market share achieved by the brand. Thus brand awareness, equity and share are all measures of what a customer thinks or does. It is not an assessment of the economic value created by those thoughts or actions.
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09 Do the valuations reflect the underlying state of the economy? Yes in two ways. The forecasts are prepared with an overall view on economic growth at a point in time. The formula for converting the Brand Strength Score into a discount rate is tied to the underlying government bond yield.
10 How does brand value rank against advertising and marketing spending? It is not really appropriate to try to correlate these two components. Brand value is a measure of the output from a series of brand investments and initiatives over a long period of time. Advertising is one component amidst a wide spectrum of communications that companies employ. Other communications include sponsorships, online, point of sale, word of mouth, experiential marketing and customer service. In some cases, brands are built with very little or no advertising, as in the case of Google where the online space, word of mouth and public relations are the key communications channels.
11 Is it possible to recognise brand value on a balance sheet? Several accounting standards such as International Accounting Standards IFRS and US-GAAP require the recognition of acquired goodwill, including brands, on the balance sheet. The standards clearly identify brands as intangible assets with an infinite economic life. This means that, unlike other intangible assets (e.g. patents, databases) or goodwill (e.g. training, workforce), brand value does not have to be amortised through the income statement. However, they are subject to an annual impairment test and their carrying value needs to be reduced if the value declined. The technique is consistent with the way in which Interbrand has assessed brands for balance sheet inclusion although, of course, using more extensive and proprietary data.
12 What is Interbrands view on brands appearing on balance sheets? We support the decision by the different accounting standards to recognise the value of brands on the balance sheet. Interbrand has led the debate on this issue for many years. However, current accounting standards allow only for the recognition of acquired brands, not internally developed brands. Also, the impairment test for brands on the balance sheet allows only for a potential value reduction but not increase. The acquisition criterion means that the Gucci brand is recognised on the balance sheet of PPR as an intangible asset, while the Louis Vuitton brand does not show up on the balance sheet of LVMH. We conclude that the recognition of acquired brands on the balance sheet is a step in the right direction for providing shareholders with better information about the assets in which they have invested. However, it is still not sufficient, as the value of internally generated brands cannot be disclosed despite making up the vast majority of the most valuable brands around the world.
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13 Why is Interbrand an expert in assessing brand value? In 1988, Interbrand developed and introduced the first valuation of a portfolio of brands that used a brand specific valuation approach. Since then, we have continuously updated and improved our valuation approach to make it the global industry standard of brand valuation. The Interbrand brand valuation methodology is the most widely endorsed and employed valuation approach around the world. Interbrand alone has valued more than 5,000 brands in all industries worldwide. Our valuations have been endorsed by leading academic institutions including Harvard, Thunderbird, Columbia, Emory and St. Gallen. Our valuation approach has a wide range of applications, including strategic brand management, marketing budget allocation, marketing ROI, portfolio management, brand extensions, mergers and acquisitions, balance sheet recognition, licensing, transfer pricing and investor relations. Our valuations have been audited for inclusion on the balance sheet by all leading accounting firms. Also, many tax authorities and law courts around the world have accepted our valuation approach.
14 Does Interbrand conduct other brand studies? In addition to Australia, we have established national brand value rankings in Switzerland, France, Spain, Singapore, China, Taiwan, Malaysia, Mexico, Russia, Canada and Brazil. These follow an identical valuation process to our Annual Global Best Brands study but only evaluate locally-owned brands.
15 What is the difference between the valuations in Best Australian Brands and consulting valuations for clients? The valuation methodology is the same, however, the level of detail and the data input differ significantly. The Best Australian Brand valuations are based on publicly available marketing and financial data. Also, the Best Australian Brand valuations are mostly consolidated top-line assessments, although we recognise segment differences for diversified brands by product or service but not geography or any other classification (e.g. financial services or technology). As the valuations are based on publicly available data, they are only as reliable as the data that the brandowning companies publish about themselves (in annual reports, analyst briefings, press articles, syndicated market research). Consulting valuations are based on detailed customer segmentations, as well as in-depth marketing and financial analyses. They have a much higher level of accuracy and granularity. The purpose of a consulting valuation extends well beyond assessing financial numbers and goes on to identify and quantify value drivers so as to manage brands for increasing the shareholder value of the underlying businesses. However, if clients undertake consulting valuations, we are in a much better position to identify publicly available data that is likely to align the Best Australian Brands valuation with the consulting valuation. In cases where companies make our consulting valuations publicly available, for example through a note in the balance sheet, these values will also be published as the Best Australian Brands ranking value.
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About Interbrand Interbrand began in 1974 when the world still thought of brands as just another word for logo. We have changed the dialogue, defined the meaning of brand management and continue to lead the debate on understanding brands as valuable business assets. We now have nearly 40 offices and are the worlds largest brand consultancy. Our practice brings together a diverse range of insightful right and left brain thinkers making our business both rigorously analytical and highly creative. Our work creates and manages brand value for clients by making the brand central to the businesss strategic goals.
Were not interested in simply being the worlds biggest brand consultancy. We want to be the most the most valued. We pioneered the technique for valuing brands in 1984 and have continued to improve upon the methodology and set the pace for other approaches. Our valuation techniques have long been recognised by business, academics and regulatory bodies as a uniquely valuable strategic tool. Today, we have conducted over 5,000 valuations for clients to provide guidance in managing their most valuable asset their brand.
Contact us
General and media inquiries: Damian Borchok Managing Director Interbrand Australia Tel: +61 2 8260 2031 Mob: +61 437 478 586 damian.borchok@interbrand.com.au Renzo Scacco General Manager Interbrand Australia Tel: +61 3 8416 3218 Mob: +61 438 722 825 renzo.scacco@interbrand.com.au Additional information on brands www.interbrand.com www.brandchannel.com
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Best Australian Brands 2009

Ranked by brand value

Appendix 27 Commonly asked questions 32 About Interbrand 32 Contact us