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Global media sector “moderately impacted” by COVID-19, potentially up to 10%: Brand Finance Media 2020 report

According to the latest Brand Finance Media 25 2020 report, the media sector is a moderately impacted industry globally and could face a potential 10% loss in brand value.

Brand Finance has assessed the impact of COVID-19 based on the effect of the outbreak on enterprise value, compared to what it was on 1st January 2020. This has been classified into 3 categories – limited impact (minimal brand value loss or potential brand value growth), moderate impact (up to 10% brand value loss), and heavy impact (up to 20% brand value loss) – based on the level of brand value loss observed for each sector in the first quarter of 2020.

In these turbulent and unprecedented times we are currently witnessing, the fortunes of the world’s most valuable media brands are no doubt going to be mixed. On the one hand, the far-reaching and extended lockdowns that have been imposed worldwide have caused a shift in consumer behaviour and thus an increase in demand for online media platforms and streaming services in particular. However, this increase in demand and subscribers may not offset, or compensate for, COVID-19’s impact on advertising, which many media brands rely on heavily for their revenue. 

Richard Haigh, Managing Director, Brand Finance

Brand Finance’s analysis shows that the most valuable media brands in the world are doing well in spite of the pandemic. Facebook has become the world’s most valuable media brand, YouTube has enjoyed steady growth, Netflix saw an 8% boost in brand value to US$22.9 billion, and Disney became is the world’s strongest media brand.

It is not all doom and gloom. Some brands will fare better under COVID-19: Amazon, Netflix, WhatsApp, Skype, BBC and BUPA are all booming. 

David Haigh, CEO, Brand Finance

Facebook claims top spot

For the first time social media brands are included in this year’s ranking and Facebook has stormed into the ranking in first place, claiming the title of the world’s most valuable media brand, with a brand value of US$79.8 billion. With over 2.5 billion active monthly users, Facebook is the most popular social media platform in the world and the brand continues to post profits above analyst expectations.

The business success of Facebook demonstrates how disconnected it is from its public reputation. Facebook has negotiated several high-profile reputational issues, most notoriously the Cambridge Analytica scandal, which resulted in a US$5 billion fine last year. More recently, in July 2020, companies across the US and Europe are boycotting advertising on the platform in a stand against the brand’s lack of action on the long-standing issue of ‘fake news’ and misinformation, while peers like Twitter take action. This has been accentuated given the heightened political climate and the resurgence of the Black Lives Matter movement.

Facebook is no stranger to being at the centre of controversy and criticism, specifically around uncensored political messaging and false information allowed on the platform. The Black Lives Matter movement in the US has been the catalyst for many advertisers to change their stance on their acceptance of misinformation and mass manipulation, causing them to question their continued use of the site. Which side will buckle first is unknown. Advertisers may be unable to resist the appeal of Facebook advertising, but equally Facebook might not be able to suffer the losses for much longer. It’s too early to tell how its brand value will emerge from the chaos of 2020.

Richard Haigh, Managing Director, Brand Finance

Facebook-owned Instagram has entered the ranking in 5th position, with a brand value of US$26.4 billion. With more than 1 billion active monthly users and a focus on new technology, like the latest Checkout feature that benefits both consumers and other brands, Instagram is catering to demand and staying relevant. The platform is successfully leveraging its position in the market as a genuine business tool – beyond its traditional influencer market – as more businesses move online during lockdown.

Ones to watch: YouTube & Netflix

YouTube has enjoyed steady growth over the course of last year, its brand value increasing 17% to US$44.5 billion. With 300 hours of video uploaded to YouTube every minute and 5 billion videos watched every day, the platform has only increased in popularity during COVID-19, becoming both an outlet for coronavirus-related news, as well as a source of entertainment as people around the world spend more time indoors.

In line with positive trends in brand value among other video streaming services, last year also saw Netflix enjoy an 8% boost in brand value to US$22.9 billion. Netflix has been a pioneering force in changing consumers’ viewing habits, taking over traditional television by providing a more appealing, flexible option in line with the modern fast-paced lifestyle. This success has only been spurred on by COVID-19, with the timely release of Tiger King raking in 34 million US viewers in the first 10 days alone.

Network television continues to lag behind online competitors, best exemplified by Fox being the fastest falling media brand this year’s ranking, with a 47% decrease in brand value to US$8.4 billion, and dropping 8 positions in the ranking to 12th place.

Consumers’ viewing habits have been transformed with the rise of streaming services. Under the current COVID-19 lockdown, it remains to be seen whether traditional television will be better positioned to compete with streaming services, or whether their brand values will continue on a downward trend for the rest of the year.

Richard Haigh, Managing Director, Brand Finance

Gaming brands crack top 10

For the first time gaming brands are also included in the Brand Finance Media 25 2020 ranking, and China’s Tencent (QQ) (brand value US$44.1 billion) and NetEase (brand value US$13.0 billion) have claimed 4th and 9th positions respectively.

As the largest gaming brand in the world, Tencent (QQ), has continued to command the sector. QQ has focused on increasing its popularity with the younger generations through expanding its entertainment packages to mini games. Furthermore, since the COVID-19 outbreak the brand’s School-plus-Home groups – which facilitates both online and offline education – have served a staggering 120 million users.

Further down the ranking, Activision Blizzard (brand value US$5.3 billion) has taken 17th spot and Electronic Arts (brand value US$3.9 billion) has entered in 23rd position.

SiriusXM grows impressive 33%

New York-headquartered broadcasting company SiriusXM is the fastest growing brand in the Brand Finance Media 25 2020 ranking, recording an impressive 33% brand value growth to US$5.0 billion.

Last year, SiriusXM completed the acquisition of leading music and podcast discovery platform, Pandora, catapulting SiriusXM to become the world’s largest audio entertainment company, reaching more than 100 million people across its audio products. Furthermore, the brand has celebrated solid business and financial performance – a result of an increase in subscribers and growth in average revenue per user.

Disney keeps sparkling

In addition to measuring overall brand value, Brand Finance also evaluates the relative strength of brands, based on factors such as marketing investment, customer familiarity, staff satisfaction, and corporate reputation. Alongside revenue forecasts, brand strength is a crucial driver of brand value. According to these criteria, Disney (up 23% to US$56.1 billion) is the world’s strongest media brand with a Brand Strength Index (BSI) score of 93.9 out of 100 and a corresponding elite AAA+ brand strength rating.

The shining star among traditional media brands, Disney, is no longer just children’s films or vacation spots – with the acquisition of 21st Century Fox, the company has secured its place as a leader in the industry. Disney has also put an emphasis on delivering direct-to-consumer experience. With the recent launch of Disney+, perfectly timed as Americans remain at home, the brand intends to take on Netflix and other emerging rivals such as HBO Max.

Every year, Brand Finance values 5,000 of the world’s biggest brands. The 25 most valuable media brands are included in the Media 25 report. Additional insights, charts, and more information are available here: Brand Finance Media 25 2020 report