BRAND VALUE

Safaricom retains title of Kenya’s most valuable brand

Safaricom has recorded 26 per cent year-on-year drop in brand value.

In Summary

•The second valuable Kenyan brand is Kenya Commercial Bank, which sits in 56th in the continental rating.

•Safaricom has recorded 26 per cent year-on-year drop in brand value.

Hazina Trade Centre
Hazina Trade Centre

Safaricom has retained the title of Kenya’s most valuable brand according to valuation by firm, Brand Finance, Africa.

The teleco, whose brand value is estimated to be $716 million, was ranked position one as Kenya's most valuable brand. 

However, Safaricom has fallen three places to 15th from last year's 12th as the continent’s most valuable brand.

The company has recorded 26 per cent year-on-year drop in brand value.

The second most valuable Kenyan brand is Kenya Commercial Bank, which sits in 56th in the continental rating.

Equity and Cooperative bans came position three and four respectively.

Image: Brand Finance

With traditional sources of revenue such as voice and SMS declining for telecos globally, Safaricom has expanded its revenue streams by acquiring the mobile money platform M-Pesa in a joint venture with Vodacom.

However, M-Pesa did not perform as well as anticipated with Safaricom seeing a six per cent decline in profit year-on-year.

The total value of M-Pesa transactions grew by 33 per cent but it was unable to capitalise on this.

Last year, the Central Bank of Kenya waived transaction fees for payments below Sh1,000 as part of the government’s Covid-19 relief efforts.

According to Brand Finance, the service's popularity and the likely reintroduction of the transaction fees does stand Safaricom in good stead, however, to see future growth in this area and regain this year’s lost brand value.

In addition to measuring 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, Safaricom is East Africa’s strongest brand, with a Brand Strength Index score of 68.3 out of 100 and a corresponding AA- brand strength rating.

Last year, the Brand Finance Africa said Africa’s top 150 most valuable brands could lose up to 12 per cent of brand value cumulatively due to the pandemic.

This was a drop of $60 billion compared to the original valuation date of January 1 2020

The valuation company assessed the impact of COVID-19 based on the effect of the outbreak on enterprise value, compared to what it was on January 1 2020.

 

Edited by CM