The value of Ireland’s biggest brands could drop by as much as 14% this year, due to the effects of the spread of the Covid-19 virus.
Independent global brand-valuation firm, Brand Finance, has warned that the value of the world’s 500 biggest companies could fall by €1tn as a result of the coronavirus outbreak, with the airline sector the most-affected.
It said Ireland’s top 25 brands stand to lose up to 14% of their value.
In terms of Brand Finance’s estimated figures, that would be a drop in value from €20.4bn to €17.5bn.
Spirit brands — including the likes of Baileys and Jameson — could lose up to 10% of their brand values, due to the market disruption caused by the virus, the report said.
“Baileys’ parent company, global drinks company, Diageo, has already warned of a significant sales hit, estimated at just over €200m, as the brand suffers with bar and pub closures, as well as travel restrictions, which are significantly impacting airport sales,” Brand Finance said.
In its latest report, Brand Finance has ranked discount clothing retailer, Penneys, as Ireland’s most valuable brand, at an estimated €2.4bn.
Penneys leap-frogged AIB — whose brand value is calculated to have dropped by 18%, to €1.9bn — and Guinness, which saw a 24% brand value drop, to €1.9bn, according to Brand Finance.
However, Brand Finance warned that with store closures expected to see Primark/Penneys lose over €700m in monthly net sales, the retailer “has a turbulent journey ahead.”
While AIB and Bank of Ireland remain in the top-ten most valuable Irish brands, Brand Finance said all banks face a rocky road, because of the fragile global economy and political landscape.
Despite the uncertainty facing it, Baileys ranks as Ireland’s fastest-growing brand, with its brand value — as estimated by the report — surging 115%, to €1.2bn.
Glanbia and Kerry Group come out of the report strongly, with their combined brands falling in the low-impact bracket and set to be “shielded” from the worst of the fallout, according to the report.