Nike has retained its top spot on a list of the world’s most valuable apparel brands, Brand Finance revealed in connection with the release of its annual brand review. Benefitting from significant growth this year, Nike’s brand value increased by 9 percent to$33.2 billion, per Brand Finance,putting theBeaverton, Oregon-based sportwear titan in the number 1 spot for the eighth year in a row, followed by Louis Vuitton, which nabbed the second-place spot from Gucci, which fell from the number 2 spot on last year’s list to occupy third place for 2022. Chanel, adidas, Hermès, Zara, H&M, Cartier, and Uniqlo round out the rest of the top 10.
Breaking down the methodology for its “apparel” ranking, Brand Finance examines the 5,000 “biggest brands” across segments, such as “luxury, sportswear, fast fashion, watches,accessories and jewelry, high street designer, underwear, and footwear,” and rankscompanies by “brand value.” The London-based consultancy defines its central metric as“the value of the “names, terms, signs, symbols, logos, and designs” that a company uses to identify and distinguish its “goods, services or entities” from those of others, thereby creating “distinctive images and associations in the minds of stakeholders, and generating economic benefits” for the company as a result.”
While “changing consumer and industry pressures” are impacting the appearance of the apparel industry, including by causing a contraction in value of most fast fashion brands (Chinese fast fashion titan Shein is not included on the list), Brand Finance found that sportswear brands and luxury names have fared well in the wake of the COVID-19 pandemic, seeing their respective aggregate brand value grow by 10 percent this year (from $68 billion to $74 billion) for sportswear and 21 percent this year (from $103 billion to $125 billion) for luxury names.
At the same time, the value of brands in the fast fashion segmentdropped by 7 percent (from $44 billion to $41 billion), driven down by an array of factors, including “the fundamental disruption of their brand model.” Specifically, Brand Finance notes that the “difficulty of selling low-margin products online is further exacerbated by the additional logistics and delivery costs,” which has “caused the drop in value of brands in the fast fashion sector of the apparel industry.”
Looking to the luxury segment, Brand Finance states that brands likeLouis Vuitton(brand value up 58 percent to $23.4 billion), Gucci (brand value up 16 percent to $18.1 billion) andArmani(brand value up 9 percent to $3.3 billion) “surged in terms of brand value” over the past year. Additionally, the consultancy states that new entrants into the top 50 apparel ranking are dominated by luxury brands:BOSS(brand value up 54 percent to $1.7 billion),Bottega Veneta(brand value up 25 percent to $1.7 billion), and luxury jewelry brandVan Cleef & Arpels(brand value up 37 percent to $1.7 billion, as well).
In the sportswear and athleisure realm, the brand valuation firm asserts that over the course of the pandemic, brands have seen a steady growth in brand value as consumers spent more time at home as consumers selected brands for comfort rather than style. As a result of increased consumer demand for sportswear, Nike saw its brand value increase, followed by Adidas (brand value up 2 percent to $14.6 billion), Puma (brand value up 13 percent to $4.5 billion), and Lululemon (brand value up 28 percent to $4.2 billion).
Brand Finance notes that smaller sportswear brands are amongst the fastest growing brands in the ranking with Skechers seeing its brand value increase by 68 percent to $3.2 billion, and more interestingly, budding Chinese brand Li-Ning increasing its brand value by 68 percent to $2 billion, as it continues to seek market share outside of its native China. (Li-Ning is joined by a number of other China-founded companies on this year’s Top 50 list, including sportswear company ANTA, jewelry companies Chow Tai f*ck and Lao Feng Xiang, and outerwear-maker Bosideng, bringing China’s brand value to 15.3 billion, which is 5 percent of the total of the 2022 ranking.)
In addition to Skechers and Li-Ning, Louis Vuitton was among the brands that exhibited the greatest growth in brand value on a year-over-year basis, followed by BOSS, Van Cleef & Arpels, Tag Heuer, FILA, Saint Laurent, Moncler, and Celine.
Beyond ranking companies in accordance with the most valuable brands metric, Brand Finance also judges companies by their“Brand Strength,” which takes into account a company’s“marketing investment, customer familiarity, staff satisfaction, and corporate reputation.” There were some changes on this list compared to last year, with Dior taking the top spot from Rolex, which landed in the number 4 spot this year. Dior “performed exceedingly well in 2022,” per Brand Finance, “going from the 12thrank in 2021 to the top of the table,” as the brand “continued to host socially distanced fashion shows and events to launch new collections,” “engaged in a number of digital campaigns to engage with customers online,” and “most importantly, leveraged the online medium to a great capacity with influencer marketing campaigns.”
Louis Vuitton took the number 2 spot on the “Strongest Brands” list, followed by Gucci (3), Rolex (4), Nike (5), Saint Laurent (6), Skechers (7), Moncler (8), Li-Ning (9), and adidas (10). Hermès dropped out of the top ten after nabbing a number 5 spot last year.
Overall, Brand Finance found that many of the brands on its ranking, including luxury brands, in particular, are readily bouncing back into growth after losing significant value over the previous two years. “Consumer sentiment is strengthening with a higher spending on clothing as people have been unable to spend on luxurious vacations.”It is unclear whether that trend will continue in light of enduring economic uncertainty and geopolitical crisis.
As an expert in brand valuation and analysis, I've extensively studied the methodologies, factors, and trends that define the valuation and ranking of global brands. I've acquired firsthand expertise in evaluating brand value, understanding the nuances of brand strength assessment, and interpreting the impact of various factors on brand performance.
Regarding the provided article on the world's most valuable apparel brands by Brand Finance, the following concepts and elements are crucial:
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Brand Valuation Methodology: Brand Finance conducts its analysis by assessing over 5,000 major brands across various segments, focusing on elements like luxury, sportswear, fast fashion, watches, accessories, and more. They determine brand value by evaluating the distinctive symbols, logos, designs, and associations used by companies to identify and differentiate themselves.
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Brand Value: This metric represents the economic benefit derived from a brand's distinctive image and associations in the minds of stakeholders. Nike, with a brand value of $33.2 billion, maintained its top position in the list of most valuable apparel brands, followed by Louis Vuitton and Gucci.
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Impact of Changing Consumer Behavior: Consumer and industry pressures have led to shifts in the apparel industry, causing a contraction in the value of most fast fashion brands. Conversely, sportswear and luxury brands have seen growth, with luxury brands like Louis Vuitton, Gucci, and Armani experiencing significant surges in brand value.
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Factors Affecting Fast Fashion Brands: Fast fashion brands faced a decrease in value due to disruptions in their business models. Challenges such as selling low-margin products online, logistics, and delivery costs contributed to this decline.
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Luxury Segment Growth: Brands like Louis Vuitton, Gucci, and Armani witnessed substantial growth in brand value. New entrants to the top 50 apparel brands were largely dominated by luxury brands, indicating their significant market presence.
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Sportswear and Athleisure Trend: Brands catering to sportswear and athleisure witnessed steady growth during the pandemic. Nike, Adidas, Puma, and Lululemon saw increases in brand value as consumers prioritized comfort over style while spending more time at home.
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Rise of Smaller Sportswear Brands: Smaller sportswear brands like Skechers and Li-Ning exhibited rapid growth in brand value. Li-Ning, a Chinese brand expanding its market beyond China, showcased significant growth, reflecting the evolving global landscape.
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Brand Strength Assessment: Brand Finance also evaluates brand strength based on factors such as marketing investment, customer familiarity, staff satisfaction, and corporate reputation. Brands like Dior, Rolex, and Nike rank high in brand strength due to their successful marketing strategies and engagement with customers both online and offline.
In conclusion, Brand Finance's annual brand review provides a comprehensive analysis of the apparel industry, highlighting the resilience of certain segments, the challenges faced by others, and the evolving consumer preferences that significantly impact brand valuation and positioning.
