However, African brands have fared poorly in terms of their brand values: the value of African brands has declined by 3% compared to an astounding rise of 18% for non-African brands.
On the face of it, this seems disastrous for the future of African brands. However, if you factor in that the South African rand has lost 23.4% of its value against the dollar and that South African brands represent 65% of the African brands on the list and have a combined value of 91%, the figures begin to tell a different story. Had there been no depreciation of the rand, African brands would have outgrown non-African brands by 20.8%.
Nevertheless, non-African brands, with their long history, well-established systems and brand-development experience, and which dominate the technology and auto sectors (which together represent 59% of the value on the list and 31% of the most-admired brands), would still command a gigantic presence in Africa.
Telecoms hold their own
The 2014 Brand Africa 100 illustrates perfectly that while it is not impossible to build a market-dominant brand from within Africa, it is just more challenging. Among the range of difficulties that a home-grown brand faces is the ever-increasing crowd of global brands, most of them giants of their industries, which are looking for alternative growth markets.
While the top 100 Most-Admired Brands in Africa list contains a respectable 22 African brands, it does highlight the continued dominance of global brands on the continent – or rather the growth opportunity for African brands. One industry where African brands have managed to hold their own, and in some cases lead the way, is in telecommunications. Almost 50% of Africans (more than 500m) own a mobile phone. The likes of MTN, GLO, and Tigo are examples of brands that have grown to giant status on the continent.
Tigo is the most notable success story, adding 82% to its brand value over the year. While it may not have its origins in Africa, the brand has spent much of its life developing in emerging markets and the lessons learned seem to be paying dividends.
It is also worth noting that 28 of the brands in the Most-Admired Brands table come from either the telecommunications or electronics/computer sector, highlighting the importance of these categories in Africa.
African brands have also managed to maintain their strong position in the Food sector with Tiger Brands and Peak Milk emerging as the most-admired brands in the sector. In the beer market, the likes of Tusker and Nile are success stories beyond the obvious SABMiller. Tusker has seen an 18% growth in brand value.
In contrast to telecommunications, the electronic/computer sector is dominated by global mega brands from North America and the East. Many of the top-performing brands in this sector are those that have managed to join the expanding mobile device market, the likes of Samsung, LG, Sony and Apple.
Not surprisingly, given the high cost of entry, the auto category, which represents 14% of the most-admired brands and 22% of the value of the list, is dominated by global brands.
Equally unsurprising, given the relatively uncompetitive textile and manufacturing industry in Africa, is that the apparel category, at 12% of the most-admired brands and 5% of the value, is also dominated by non-African brands such as Nike and Adidas, and Levi’s and the highly aspirational brands such as Gucci and Louis Vuitton – brands which are abundantly present in the counterfeit markets in Africa.