Record valuations for tobacco brands

| March 3, 2017

Marlboro, the most valuable tobacco brand

Despite mounting regulatory restrictions, tobacco brands continue to gain value, according to Brand Finance, a U.K. valuation and strategy consultancy.

Every year, Brand Finance values the brands of the world’s biggest companies. Brands are appraised to determine their strength and given a corresponding letter grade up to AAA+. The valuations are based on factors such as marketing investment, familiarity, loyalty, staff satisfaction and corporate reputation.

Brand strength is used to determine what proportion of a business’s revenue is contributed by the brand, which is projected into perpetuity to determine the brand’s value. The world’s most valuable tobacco brands are ranked and included in the Brand Finance Tobacco 50 2017.

Marlboro, the world’s most valuable tobacco brand, achieved a record brand value of $32.4 billion in Brand Finance’s most recent review.

The brand’s decline in Western markets is being offset by growth in other parts of the world, such as China, Indonesia and Africa, where regulation remains weaker. Marlboro is also successfully extending its brand into new products. For example, Marlboro’s iQOS tobacco-heating system has proved hugely popular, demonstrating the brand’s power.

According to the company, more than 80 percent of tobacco brands are growing in value.

“Marlboro’s success is by no means an isolated case, with the brand values of major names such as Pall Mall, L&M, Newport and Winston all growing this year and the likes of Parliament, Sampoerna and Chesterfield enjoying double digit growth,” says David Haigh, CEO of Brand Finance.

“Despite the well-founded health concerns and mounting regulation, the value of these brands for their owners and investors remains robust. The day when the value of tobacco brands goes up in smoke is a long way off.”

 

 

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