Just how much is it worth?
Originally published by Joe Thompson on Hodinkee.
Each year, the marketing research consultant Kantar Millward Brown issues a report ranking the world’s leading brands by their estimated brand value. The BrandZ Top 100 Most Valuable Global Brands, as the report is called, ranks the world’s top 100 brands in terms of brand equity. It also ranks the most valuable brands in a number of key product segments, including luxury.
A review of the 315-page 2017 BrandZ report, issued in June, makes it clear that the world’s most valuable watch brand is Rolex, which has an estimated brand value of $8.053 billion. The estimate is based on a complicated formula combining financial information and consumer surveys. KMB interviews three million consumers in more than 50 global markets about 100,000 different brands. It uses data from Bloomberg and Kantar Worldpanel to analyze companies’ financial and business performance.
To be clear, Rolex is not among KMB’s Top 100 brands. (A brand needed a value of at least $11.3 billion to make that list.) Rolex appears in the report on the BrandZ Luxury Top 10 list, where it holds the #5 position (see table below). Rolex is the only one of the top 10 luxury brands whose sole product is watches. No other watches-only brand is included in the BrandZ report.
Rolex is Switzerland’s best-selling brand by revenue. Until recently, it was also the world’s best-selling watch brand by revenue. Apple now claims that crown. (Apple, with a brand value of $234.67 billion, ranks #2 on the Top 100 brand value list, after Google at $245.58 billion.) As a private company, Rolex does not disclose sales data. Swiss analysts estimate its annual sales at around $4.5 billion.
It’s worth noting that eight of the other nine brands on the Luxury Top 10 list have watches in their product portfolio, a sign of the extent to which the wristwatch has become a fashion accessory in recent decades. (The only brand on the list without a watch is Prada.) Most of the other brands produce their own watches; Burberry watches are made under a license deal. But, other than Rolex, all of the other brands are most famous for a product or products other than watches.
That includes Cartier, which ranks just below Rolex at #6 on the top luxury brands list, with a brand value estimated by KMB at $5.84 billion. While Cartier has a substantial watch business (it is Switzerland’s third best-selling watch brand in revenue after Rolex and Omega), the brand is better known as a jewelry manufacturer and retailer.
Rolex and Cartier have made the BrandZ Luxury Top 10 list every year since the first one in 2006. In 2006, both brands also made the Top 100 list: Cartier at #82 with a brand value of $5.55 billion, Rolex at #90 with a brand value of $4.92 billion.
The explosive growth of consumer-focused technology brands (Google, Apple, Amazon, Facebook, etc.) over the past dozen years have pushed luxury brands off the top 100 list. In 2017, only the top three luxury brands make the Top 100 list.
In fact, the brand value of both Rolex and Cartier has dropped over the past three years as a result of the slump in Swiss watch sales, primarily in Asia. In 2014, Rolex’s estimated brand value was $9.08 billion. It’s dropped 11 percent since then. Cartier has fared much worse, losing more than $3 billion in brand value, according to KMG’s estimates. KMB placed that value at $8.91 billion in 2014. Since then, it’s down 34 percent.