What comes to mind when you think about Spain or Japan?
Just like anything else, our brains tend to associate certain images and attributes with a given country in order to form a unique mental perception.
In a global marketplace, a country’s national image can be one of its most valued assets or a challenging liability. These perceptions help to forge a country’s reputation, and also have a long-lasting impact on future economic potential and the ability to attract new investment.
Introducing Nation Brands
Earlier this week, Brand Finance released its 2018 report in an attempt to place a dollar value on these national perceptions.
While the specific methodology is covered directly in the report, what you need to know is that Brand Finance uses three pillars to calculate a Brand Strength Index score.
The three pillars are:
- Goods & Services: Includes factors such as openness to tourism, market size, and trade rules
- Society: Includes factors such as quality of life, corporate ethics, corruption, and cultural image
- Investment: Includes items such as talent retention, use of technology, R&D, taxation, and regulation
The Brand Index Score is then used to calculate a hypothetical royalty rate, and to forecast revenues to ultimately derive a brand value (post-tax revenues discounted to calculate a net present value).
Which Nation Brands are Most Valuable?
Here are the world’s 15 most valuable nation brands, as ranked in the most recent report.
| RANK | COUNTRY | 2018 BRAND VALUE | CHANGE (VS. 2017) |
|---|---|---|---|
| #1 | United States | $25.9 trillion | 23% |
| #2 | China | $12.8 trillion | 25% |
| #3 | Germany | $5.1 trillion | 28% |
| #4 | United Kingdom | $3.8 trillion | 20% |
| #5 | Japan | $3.6 trillion | 5% |
| #6 | France | $3.2 trillion | 9% |
| #7 | Canada | $2.2 trillion | 8% |
| #8 | Italy | $2.2 trillion | 9% |
| #9 | India | $2.2 trillion | 5% |
| #10 | South Korea | $2.0 trillion | 8% |
| #11 | Australia | $1.7 trillion | 11% |
| #12 | Spain | $1.6 trillion | 14% |
| #13 | Netherlands | $1.2 trillion | 18% |
| #14 | Mexico | $1.1 trillion | 2% |
| #15 | Switzerland | $1.1 trillion | -4% |
The U.S. takes the top spot at $25.9 trillion, but the fastest growing brand valuation was Germany’s, which jumped 28% over the past year.
How the Ranking Has Changed Over Time
Brand valuations can change over time – and looking at Nation Brands over the last eight years helps to get a sense of long-term trends:
By 2012, China had cemented the second place spot, displacing both Japan and Germany.
Meanwhile, Brazil made a brief appearance in the Top 10, but then precipitously dropped off the list. It now sits at 17th place in the 2018 rankings.
Courtesy of: Visual Capitalist
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