Posted on April 10, 2017

Every year, leading valuation and strategy consultancy Brand Finance values the brands of thousands of the world’s biggest companies. A brand’s strength is assessed (based on factors such as marketing investment, familiarity, preference, sustainability and margins) to determine what proportion of a business’s revenue is contributed by the brand. This is proportion is projected into perpetuity and discounted to determine the brand’s value. The Middle East’s 50 most valuable brands, classified by both their industry and their nation, are featured in the Brand Finance Middle East 50.

View the full list of the Middle East’s 50 most valuable brands here

The Corporate Brand Battle

QNB’s brand value is up 56% to US$3.8bn. The Middle East’s most valuable bank brand completed the acquisition of Turkey’s Finansbank this year and continues to strengthen its position not just in the Middle East but in Africa and Asia too. Its strong growth has seen it move ahead of Qatar Airways to become the nation’s most valuable brand.

In contrast Qatar Airways has seen its brand value fall 38% to US$2.16 billion. Brand Finance CEO David Haigh explains the difficult year faced by many GCC airlines, “The low oil price in the early part of 2016 has levelled the playing field for international rivals, leading to increased competition, driving down fares. The discount rate applied to all Gulf airlines has increased in tandem with this less favourable environment, reducing long term value. Finally, the strength of the dollar has increased operating costs and also had a negative FX impact on all non-US domiciled brands.”

Emirates has been hit by the same trend. It was the most valuable brand in the Middle East ever since Brand Finance initiated its ranking in 2010 and the Dubai-based airline has been top of its industry at a global level for the last five years. However 2017 sees a dramatic shift. Emirates’ brand value is down 21% to US$6.1 billion. This sees it lose its place at the top of its industry; three US brands (American, United and Delta) have overtaken it. Even more dramatically however, Emirates has lost its place as the Middle East’s most valuable brand to STC.

STC grew 11% in value this year to US$6.2 billion. Brand Finance Middle East Managing Director Andrew Campbell comments, “The Riyadh-based giant demonstrates a departure from its once traditional approach; it is embarking down a path of ‘humanisation’, re-engaging its many stakeholders with a fresh, personable outlook. A clear indication of its success is the 5-point increase in its brand strength index score, proving that putting some heart into it pays off." Like STC, Ooredoo has generally tried to employ a mono-brand structure. Since rebranding in its home market of Qatar in 2014, Ooredoo has pursued a successful rebrand strategy across seven other markets, establishing a significant regional brand spanning Africa, the Middle East and South East Asia.

This has provided a platform for launching a new network in Myanmar, as well as fully dual branding with large, well-established operator, Indosat in Indonesia. Ooredoo’s brand value has grown from below $1bn to more than $3bn in four years, propelling it into the top 10. Ooreedoo is now 6th, up from 11th last year.

The National Brand Battle

STC’s victory means Saudi Arabia can now lay claim to the region’s most valuable brand after years of the UAE taking the title. Saudi Arabia has been less successful in other respects however. It continues to have the most brands in the table, 18 to UAE’s 17, however this is down from 21 last year. It also continues to trail the UAE on total brand value, making up 32% of the total value of the top 50; the UAE constitutes 44%. Qatar continues to solidify its position as the Middle East’s third most important brand building nation, further marginalising Kuwait, which used to hold that status. Kuwait’s 4 brands now account for 7% of total brand value, less than half the total of Qatar’s 8 brands.

Oman has just one brand in the list, with Omantel managing to improve its rank from 47th to 45th despite modest 5% brand value growth. 2017 sees a positive development for Jordan and Lebanon which have both re-entered the Brand Finance Middle East 50. Jordan’s Arab Bank just edges out Lebanon’s Bank Audi with a brand value of US$382 million to US$368 million. Bahrain is the only GCC nation not to feature. Ahli United bank, Bahrian’s most valuable brand has had a positive year, growing from US$252 million to US$296 million, however this has not been enough to reach the US$358 million threshold for 50th place.