Announcing Best Japan Brands 2018, including: Japan’s Top 40 Best Global Brands (JBGB) and Japan’s Top 40 Best Domestic Brands (JBDB)
Tokyo, Japan – 14 February, 2018 – Interbrand Japan, located in Shibuya, Tokyo, has released its 2018 Best Japan Brands report. This report ranks the brand value of brands originating in Japan through a proprietary Brand Valuation methodology that converts the value of independent brands into a monetary value.
The annual ranking, which has been compiled since 2009, is now in its 10th consecutive year. Unlike other rankings, Best Japan Brands 2018 announces the Top 40 brands in two categories: Japan’s Best Global Brands (JBGB), which analyzes global Japanese brands, or brands with an overseas sales ratio of more than 30%; and Japan’s Best Domestic Brands (JBDB), which ranks domestic Japanese brands, or brands with an overseas sales ratio less than 30%.
“When putting together our 10th annual report, we wanted to present the data
in a way that shows these brands are increasing in value globally. We believe
Best Japan Brands serves as a measuring rod to compare domestic brands with
global brands,” said Masahito Namiki, President & CEO, Interbrand Japan. “Over the course of these past 10 years, we’ve seen how Japanese brands grow, and more importantly how we can help clients grow their brands to close the gap with the rest of the world.”
The rankings were dominated by automotive brands (10 brands), electric appliance brands (5 brands), and financial brands (5 brands). Automotive brands were led by Toyota (JBGB #1, -6% compared with the previous year). As a group, they continued to expand their brand value to drive the overall growth of JBGB and JBDB .
Among JBGB 2018, four out of the Top 10 spots were occupied by automotive brands, with Toyota at #1 for the tenth consecutive year, Honda at #2(+3% compared with the previous year), Nissan at #3 (+4% compared with the previous year), and Subaru at #9(+12% compared with the previous year). Subaru held the second highest growth rate for brand value at 12%. Overall, 10 automotive brands dominated the Top 40.
In JBDB 2018, NTT DOCOMO took the top position (+3% compared with the previous year) for the eighth consecutive year, followed by SoftBank (#2, -8% compared with the previous year) and au (#3, -3% compared with the previous year). While these three major communication companies maintained stable growth, ZOZOTOWN (#32), MS&AD (#36), and H.I.S. (#40) entered the rankings for the first time.
“The world’s economy is slowly recovering. Although individual consumer spending has been sluggish, Japan has enjoyed record economic growth for 52 months, the third longest period of growth since World War II,” said Namiki. “The JBGB 2018’s Top 40 has experienced an estimated 40% growth in monetary brand value compared to JBGB 2009. Also during this time, Japanese brands have rapidly globalized. Organizations that recognized the importance of their brand and worked to enhance them continued to show a high growth rate in their brand value.”
Best Japan Brands uses the same valuation methodology as Interbrand’s Best Global Brands, which has analyzed and ranked the Top 100 global brands annually since 2000, and uses world standards as an index to compare the value of Japanese brands to leading global brands.
CRITERIA AND METHODOLOGY
Criteria for inclusion in Japan’s Best Brands:
In order to shed light on the value of global Japanese brands and enable comparison of their relative positions against a common global measure, brands meeting the following criteria were selected for evaluation:
Interbrand’s methodology for assessing brand value is based on the brand’s financial strength, influence on purchasing decisions, and contribution to future earnings. In the same way that securities analysts analyze and evaluate the value of a company, we analyze and evaluate the value of a brand by asking, “What is its future earning potential?” This methodology has been certified compliant with the ISO 10668, the global standard for measuring the monetary value of brands as established by the International Organization for Standardization.
There are three key components to all of our valuations: an analysis of the financial performance of the branded products or services, of the role the brand plays in purchase decisions, and of the brand’s competitive strength.
First, we estimate the current and future revenues of the business operating under the brand. We then subtract operating earnings, taxes, and capital cost of investment to calculate future economic profit. Our analysis is based on published corporate data; future projections are based on analyst performance forecasts. (Note: For analyst forecasts this evaluation relies on analysts’ estimates obtained from IFS Japan, Ltd. The IFIS Consensus data http://www-en.ifis.co.jp/ used is current as of November 20, 2017.)
Next, to derive the brand’s contribution to future economic profits as calculated in the analysis of financial performance, we analyze the brand’s influence on customer purchasing decisions. In evaluating the role that a brand plays in consumer purchasing trends, we perform benchmark analyses by industry that draw on our database of brand valuations performed over the past 30 years. Based on these industry benchmarks, we perform a proprietary analysis to derive a brand contribution score.
Brand strength analysis measures a brand’s power to inspire what the client needs to sustain future earnings—market loyalty, repeat purchases by consumers, and lock-in—and discounts brand earnings to derive a present value. Our evaluation offers a systematic means of determining a brand’s risk based on 10 influential factors. These include not only external factors such as market position, consumer recognition and favorability, and brand image, but also internal factors such as support for the brand among management and employees, and the company’s brand protection system. This results in a score between 0 and 100.