Interbrand Releases 2011 Best China Brands Report

Dalian, China, September 15, 2011–Interbrand, the leading brand consultancy, announces its 2011 Best China Brands ranking during the World Economic Forum’s Summer Davos here in Dalian, China. China Mobile, China Life, China Construction Bank (CCB), Industrial and Commercial Bank of China (ICBC), Bank of China (BOC) and Ping An Insurance (Group) Company of China remain in the top six spots, compared with 2010. Tencent, whose brand value has increased 76% in the past twelve months, leaped to the seventh place. In addition, China Taiping, China Everbright Bank, Belle International, Great Wall Motor Company and Bank of Beijing make their debut on the list.

Mr. Serge Dumont, Vice Chairman, Omnicom, pointed out that “brands have already become the new engine of growth for Chinese enterprises. Our 40 Omnicom-owned agencies operating in China represent every major marketing and communications disciplines,” said Dumont. “They are committed to developing Chinese talent to be best in class and help clients create, manage and communicate their reputations and continuously increase the value of their brands – in China and around the world.”

As the leading brand consultancy, Interbrand pioneered the research into the brand valuation model in 1984 and its methodology has long been recognized by the business world as a strategic management tool of unique value. The 2011 Best China Brands is the fourth annual ranking by Interbrand in the Chinese market, utilizing a consistent valuation model with Interbrand’s Best Global Brands. Based on financial data independently audited by a third party, industry-specific studies and market data, the brand valuations provide a benchmark for Chinese enterprises in the development of their brands. The brand value calculated by Interbrand indicates the Net Present Value (NPV) of brand earnings of the selected brands at the end of 2010 and onwards. This consistent and transparent approach makes the ranking fair and comparable around the world and over the years.

According to the ranking, the brand value of outstanding Chinese enterprises is on the rise as China’s economy continues to grow, reflecting an evolution in Chinese brands from best-in-class to world-class. During the past four years (2007-2011), Baidu, Haier and Lining have been the fastest-growing brands in terms of brand value, with Compound Annual Growth Rates (CAGR) of 84%, 68% and 39%, respectively. Bank of Beijing ranks 50th this year with a brand value of 1.36 billion Yuan, an increase of 210 million yuan from the 50th brand last year. The total brand value of the top 25 2011 Best China Brands reached 896.17 billion Yuan in 2011, a 13.5% increase from 2010. Interbrand’s Global CEO Jez Frampton: “The shift from best-in-class to world-class demonstrated 2 by these Chinese brands shows that brands are playing an increasingly important role in pushing forward the development of Chinese enterprises. The members of this year’s list are shining examples of how Chinese enterprises can use their brands to create new opportunities for growth and deliver greater value for their owners.”

The financial services industry remains prominent on the list. Nineteen of the 50 best brands are from this industry, including 12 banks, 4 insurance companies and 3 securities companies. Among the 19 financial services enterprises, 7 rank among the top 10. Emerging commercial banks, which must aggressively innovate in the face of fierce competition, have shown stronger growth momentum as a whole. The brand values of Minsheng Bank, Hua Xia Bank and Industrial Bank increased 63%, 58% and 50% respectively over the past year. In the securities industry, the brand value of CITIC Securities has also registered a 50% increase.

The IT services industry is another fast growing sector in terms of brand value, an industry-wide 68% increase from 2010. IT services brands such as Tencent, Baidu, Alibaba and Ctrip, are more open and confident in their service offerings. For instance, Tencent has become the largest internet service portal; Baidu is filling the place of recently-departed Google; while Alibaba and Ctrip are continuing to add innovations to China’s e-commerce sector. New Oriental Education, the only brand on the list in the education service sector, has jumped from the 40thspot last year to 32ndwith a 64% growth in its brand value. As a weather vane for the whole sector, it illustrates a powerful trend as the sector moves away from traditional approaches and takes risks to redefine itself.

In the apparel sector, brand values have shown significant changes over the past year. Belle (43rd) enters the list for the first time. As a shining star, Bosideng (47th) is succeeding in transitioning its product line from down coats to fashion apparel, registering a 25% increase in its brand value. These changes show that apparel is becoming an increasingly important symbol of lifestyle in China, and that brands are due to play an important role in helping the industry grow.

The food and beverage industry suffered a decline in brand value of 25%. Food safety issues contributed to lower brand values for three food enterprises ,Yurun, Mengniu and Shuanghui, which were on the 2010 list. Shuanghui’s brand value dropped by 41%, dropping its rank from 38th to 49th. As the public is increasingly concerned with food safety, but also longs for a healthier life, food brands will continue to face both challenges and 3 opportunities in the future.

The Best China Brands report establishes a systematic approach to the growth of Chinese brands. As remarked by Mr. Jez Frampton, CEO of Interbrand Global, “Chinese brands are accumulating strength at home to actively prepare for future development overseas. We are already experiencing Chinese Brands around the world, and will likely see one of the 2011 Best China Brands among the top 100 Best Global Brands in the near future”.