Consultancy Interbrands has published its annual ranking of Brazil’s 25 most valuable brands. While Petrobras makes the list, it ranks only 8th. The top 5 positions are all dominated by beer labels and banks. It is not a coincidence that Brazil’s four richest men operate in these two sectors, with three of them being partners in the same beverage company, Ambev—which produces the top 3 most valuable beer labels in the country.

These 25 companies combine for a market value of BRL 120 billion—a 2.7 percent growth from last year’s ranking. They represent companies that managed to overcome the recent recession, which was Brazil’s worst on record. Truth be told, the challenge was easier for banks, which profit in Brazil no matter what the economic scenario is. Our ultra-concentrated market makes it easier for the reduced number of players to slap tariffs on consumers and increase their revenue.

To be featured on Interbrand’s ranking, a brand must have Brazilian origin and public financial statements. The study, which has been carried out since 2001, ranks brands according to financial performance, public perception, and the influence they have on consumers. “The recent economic crisis generated a loss in confidence levels, putting some companies’ reputations on the line. The brands in our report have overcome these challenges,” said Daniella Bianchi, Interbrand’s Director in São Paulo.


Banks and beer top Brazil's most valuable brands list


The biggest success story

While 15 of the 25 Brazilian most valuable brands have increased their market value over the past year, none has had the leap of retail giant Magazine Luiza. The company gained 50 percent of market value since 2017 and has become one of the São Paulo Stock Exchange hottest shares to buy. And all of that in a business as brutal as Brazilian retail.

With uniquely challenging logistical hurdles, Brazilian retailers must also face tax complexity and economic instability to make their tight margins. Walmart, for instance, spent billions of dollars trying to gain a foothold on Latin America’s biggest market—an experiment which ended in utter failure. 


Banks and beer top Brazil's most valuable brands list


In 2015, Magazine Luiza in crisis, with its market value standing at BRL 200 million in November of that year. Now, according to Interbrands, the company’s value has been multiplied by four. In 2018’s third-quarter, the company posted net profits of BRL 120 million, 29 percent higher than one year ago. The retail giant was the company with the highest gain of value between 2013 and 2017—the worst economic moment in Brazil’s recent times.

The rise was thanks to the company’s move into the digital era – which, even in 2018, is not necessarily the norm among its competitors. The use of apps to make purchases easier and a well-structured online store boosted sales both in physical shops and online. Over this year’s third-trimester, Magazine Luiza registered a growth of 55 percent in online sales—and that’s not even counting Black Friday

Read the full story NOW!

MoneyNov 23, 2018

Tags: -

BY Gustavo Ribeiro

An award-winning journalist with experience covering Brazilian politics and international affairs. His work has been featured across Brazilian and French media outlets.