Food In Canada

Coca-Cola and Nestlé continue to dominate food and drink sector: Report

By Food in Canada staff   

Food Trends Brand Finance Coca-Cola Nestle Yili


According to the Brand Finance Food & Drink 2021 report, the majority of subsectors in the food and beverage industry have recorded cumulative brand value losses this year, as the sectors negotiated the fallout from the COVID-19 pandemic.

Soft drink brands are the most severely impacted, with the total value of the world’s top 25 most valuable soft drinks brands declining by six per cent, from US$114.8 billion in 2020 to US$107.5 billion in 2021. The total brand value of food and chocolate brands have declined by four and three per cent, respectively. The only subsector in the report to protect itself from a brand value loss is the dairy sector, which has maintained its total brand value year-on-year.

“The COVID-19 pandemic has put a huge amount of pressure on the food & drink industry globally, from disrupted supply chains and panic buying, to a complete change in consumer habits. The result of this has led to the majority of brand values suffering this year across the sector. The future is not bleak, however; brands with high levels of familiarity and reputation are likely to bounce back successfully as we begin the return to normality,” said Savio D’Souza, valuation director of Brand Finance.

American giant, Coca-Cola, has once again been named the world’s most valuable soft drink brand, despite recording a 13 per cent brand value decline to US$33.2 billion. Coca-Cola maintains a healthy lead over rival Pepsi, sitting in second place with a brand value of US$18.4 billion.

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In addition to measuring overall brand value, Brand Finance also determines the relative strength of brands through a balanced scorecard of metrics evaluating marketing investment, stakeholder equity and business performance. According to these criteria, Coca-Cola is also the world’s strongest soft drink brand and the fourth strongest brand in the world, according to the Brand Finance Global 500 2021 ranking. It scored a Brand Strength Index (BSI) score of 91.7 out of 100 and a corresponding elite AAA+ brand strength rating.

When looking at the brand portfolios across the food and drink sector, the Coca-Cola Company’s portfolio claims third position with a cumulative brand value of US$48.6 billion. PepsiCo’s portfolio sits in second, with a total brand value of US$59.3 billion.

Dr Pepper and Red Bull are the fastest and second-fastest growing soft drink brands this year, recording a 40 and 15 per cent brand value increase, respectively.

Nestlé dominates food sector

Nestlé once again leads the pack as the world’s most valuable and strongest brand in the Brand Finance Food ranking, which for the first time has been extended to 100 brands.

Despite the pandemic, the food giant has posted its third consecutive year of organic growth, profitability, and return on investment capital. The sheer size, presence and experience of the company in the sector has allowed it to successfully adapt to the ever-changing and challenging landscape.

According to Brand Finance’s Global Brand Equity Monitor, Nestlé has increased its scores in the consideration metric, as well as improving its score for the community and environment metrics under the CSR measurement. With a continued focus on product innovation and R&D, Nestlé is spearheading changes to reflect the current consumer trends, from its product Smarties becoming the first major global confectionary brand to switch to sustainably sourced paper, to announcing the launch of a vegan KitKat.

The Nestlé portfolio is also the most valuable food & drink portfolio, with a total brand value of US$65.6 billion. Despite the parent company underperforming compared with the previous year, it has been offset by the overperformance of some of its sub brands, particularly in the pet care and non-alcoholic drinks segments.

Yili posts healthy growth

Once again, Yili is the world’s most valuable dairy brand, posting an 11 per cent increase in brand value this year to US$9.6 billion and pulling even further ahead of previous sector leader Danone (up 5 per cent to US$8.2 billion) in second place. Yili also claims second spot behind Nestlé in the Brand Finance Food 100 2021 ranking.

Lindt hops to the top of the chocolate ranking

A market leader in premium quality chocolate, Lindt is the world’s most valuable chocolate brand, recording a 21 per cent brand value increase to US$3.1 billion. As with other chocolate brands globally, Lindt’s operations have taken a hit amid global lockdowns, particularly from those that have taken place over Easter and Christmas. That being said, Lindt has outperformed its peers, gaining market share in nearly all of its markets and posting strong results in the premium segments.

View the full Brand Finance Food & Drink 2021 report here.

 


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