Brand Finance logo

UPS Delivers on Brand Value

05 March 2018
This article is more than 3 years old.

· Big logistics brands stagnant despite e-commerce growth as UPS remains sector’s most valuable brand at US$22.0 billion.

· MTR is the strongest logistics brand with a brand strength score of 82.2 as brands from mainland China break into the top 25.

· Royal Mail and La Poste lose brand value while Deutsche Post and Poste Italiane record significant growth.

View the Brand Finance Logistics 25 report here

View the full list of the world’s 25 most valuable logistics brands here

UPS remains the world’s most valuable logistics brand, according to the latest Brand Finance Logistics 25 report, despite 1% year-on-year decrease in brand value to US$22.0 billion.

UPS’s profits decreased by 7% as did its forecast revenue growth by 10%. Nevertheless, UPS remains at the top of the table as it continues to lead the way in technological advances. The company recently invested US$3 billion to revamp its network and completed the first phase of the ORION project, a cutting-edge navigation system offering the most up-to-date routes for drivers, generating around US$400 million in savings.

The top six brands collectively had a stagnant year, with aggregate brand value growth of just 0.2% between them, despite increased online retailing and consequent demand for delivery services. In effect, it appears that the big logistics brands are being squeezed on both ends, by both customers and competitors. This is because local delivery brands are providing increased competition, and the large online retailers are able to demand lower prices.

Richard Haigh, Managing Director of Brand Finance, commented:

“There is no doubt that forging a distinct brand helps a business to build resilience. As Amazon prepares to launch ‘Shipping with Amazon’, having a strong brand can help protect incumbents from this new competition. Powerful brands alone will not be enough to prevent Amazon from gaining a foothold in the industry, however they will allow breathing room for the existing brands to riposte and limit their loss of market share.”

FedEx Posts Steady Growth
Meanwhile, FedEx (up 6% to US$18.2 billion) retained second place supported by its acquisition of TNT Express. With this purchase, FedEx is taking steps to create a truly global network, and the first phase is complete as TNT Express packages can now be handled by FedEx drivers and enquiries to one platform can be solved from both.

However, the TNT acquisition has also caused problems for FedEx as the Petya cyber-attack created a loss of revenue due to decreased volumes at TNT Express as well as incremental costs associated with contingency plans and amending affected systems. Although TNT services have been substantially restored, the economic consequences for future brand value could be considerable.

MTR: Brand Strength Going Places
The strongest brand this year is Hong Kong’s public transport brand, MTR, increasing its Brand Strength Index (BSI) score to 82.2 with a brand rating of AAA-. MTR operates one of the most efficient rapid transit systems on the planet, with 99.9% of passengers arriving within 5 minutes of the scheduled time. Its focus on high-quality services is attractive to customers, and protects the brand amongst key stakeholders. At the same time, MTR has a stated policy of minimising environmental impacts while delivering safe, fast, and reliable public transport services.

Brands from mainland China also fared well, largely driven by their expected business growth and focus on serving their domestic markets. Following fast year-on-year increase in brand value, CRSC (China Railways Signal & Communication Corporation, up 54% to US$1.3 billion) and SIPG (Shanghai International Port, up 47% to US$1.2 billion) entered the Brand Finance Logistics 25 league table at 24th and 25th place respectively.

Mail Services Push the Envelope
The flagship of UK logistics, Royal Mail (down 20% to US$2.2 billion) continues to struggle as it experienced the largest drop in brand value in the sector. Along with a decline in letter delivery, the company is facing fierce competition from other parcel delivery services, such as UPS which offers services globally. French mail service, La Poste (down 6% to US$3.7 billion), faced similar challenges.

By contrast, Poste Italiane (up 20% to US$4.8 billion) and Deutsche Post (up 29% to US$4.3 billion) have both recorded significant brand value growth in the past year. Poste Italiane revamped its structure, and today, almost 90% of its revenue comes from insurance or financial services. With increased revenue and favourable forecasts, the company is positioned well for the future. Similarly, Deutsche Post has grown to include more parcel services in conjunction with DHL, which is part of the same corporation.

ENDS

Note to Editors

Every year, leading valuation and strategy consultancy Brand Finance values the world’s biggest brands. The 25 most valuable logistics brands in the world are included in the Brand Finance Logistics 25 2018 league table.

Brand value is equal to a net economic benefit that a brand owner would achieve by licensing the brand. Brand strength is used to determine what proportion of a business’s revenue is contributed by the brand.

More information about the methodology as well as definitions of key terms are available in the Brand Finance Logistics 25 2018 report.

Data compiled for the Brand Finance Logistics 25 league table and report is provided for the benefit of the media and is not to be used for any commercial or technical purpose without written permission from Brand Finance.

Media Contacts

Konrad Jagodzinski
Konrad Jagodzinski
Communications Director
Brand Finance
M:
Florina Cormack-Loyd
Florina Cormack-Loyd
Senior Communications Manager
Brand Finance
M:

Get in Touch

Message