We have been reporting on Canada’s top 100 most valuable brands for more than decade. The ranking during this time, especially the top ten, has been reliable and sometimes even predictable. Strong, traditional, legacy brands form the bedrock of the Canadian brand economy, and accordingly, banks and telcos and have historically dominated the top ten. This reflects the Canadian economy generally: low-risk, conservative, and effective.
These traits have historically been a safeguard against economic crises; however, the pandemic has put forward a unique set of challenges for Canadian brands. Brands have been required to constantly adapt to shifting pandemic response policies. This manifested as a blessing in disguise for some sectors, and a quagmire of cutbacks and logistics for others. The typically reliable Canada Top 100 has never been more dynamic.
There is also some light at the end of the tunnel. From 2020 to 2021, the aggregate value of the Top 100 Canadian brands fell by 1%. It was the first time that the brand economy decreased in value since we began our study. This year, we are happy to report that Canadian brands are back in the green, having grown in value by an average of 22%. Canadian brands (for the most part) are bouncing back.
The top ten has traditionally been dominated by the big banks and telcos. Incidentally, these are the kind of brands we would expect to see at the top of a ranking in a developing economy, rather than mature economy. Tech sector brands are still notably missing at the top of the table, but with the current trends in the sector, we will likely see Shopify and Constellation Software vying for the top 10 in the near future.Charles Scarlett-Smith, Director of Brand Finance Canada
RBC (brand value up 13% to CA$23.5 billion) has regained the top spot as the most valuable brand in Canada after falling second to TD in 2020 (brand value up 3% to $21.7 billion).
RBC and Scotiabank are the only two banking brands that have seen double digit growth since 2020. This stasis is quite worrisome and it signals a sector stuck in a bit of a rut. The big six are designed to be a one-stop-shop for all Canadian banking needs, but this model is proving cumbersome. Legacy systems and processes, in addition to the cost required to maintain brick and mortar branches, are stifling the big six’s ability to provide modern banking services with the same ease and elegance as their Fintech competitors.
Canadian consumers are increasingly now the owners of two or more bank accounts, which are simple to set-up, and provided at a lower cost (or free of charge). Disruptor brands such as Tangerine, Simplii, Wealthsimple, and PC Financial, entered the market effectively by focusing on a single offering – chequing accounts, investment portfolio management, or competitive rebates. Now, with established client bases, these fintechs are rolling out more diverse product lines and services, while remaining cheap and convenient. This will eat away at the big six’s client base, especially with younger age brackets. The big six need to respond and invest in modernising or risk stagnation.
The Oil & Gas sector has achieved an aggregate 69% increase in brand value over the past year. The sector is finally bouncing back after the crash in 2014. The top six fastest growing brands in the country all belong to the energy sector, with Enerplus leading the charge with an eyewatering brand value growth of 214% to $508 million. Revisited financial forecasts in the Canadian energy sector have been the main driver of the surge in brand value for many of these brands.
With global consumers seeking to reduce reliance on Russian hydrocarbons, Canadian brands have an opportunity to leverage their key strengths to better serve customers. While environmental concerns and regulation may limit long-term value growth, many engines across the domestic, commercial, industrial, and public sectors will continue to require refined oil and gas. This remains a significant opportunity for Canadian oil and gas brands.
The rise of homegrown Canadian tech brands continues to be strong this year. Over the past year, the tech sector saw a doubling of aggregate brand value to $12.8 billion. As other sectors of the economy began recovering from the pandemic, tech continued its meteoric rise in Canada as it becomes an increasingly important player with impressive brand values.
Shopify continues to lead this growth increasing by 68% in value to $1.3 billion over the past year; totalling a 257% increase in brand value over the course of the pandemic. The brand continues to post impressive financials and maintain their entrepreneurial spirit with collaborations and partnerships with other new exciting brands. Partnerships with TikTok and Spotify have allowed creators and musicians to monetise their platform directly through the app. Shopify’s continued brand value growth can also be attributed to growth in Shopify Capital and Balance, which give small businesses and entrepreneurs access to much-needed capital and a comprehensive money management system.
Shopify’s continued brand value growth can also be attributed, in part, to growth in Shopify Capital and Balance, giving small businesses and entrepreneurs access to much-needed capital and a comprehensive money management system.
Canada’s most valuable tech brand, Constellation Software has achieved significant brand value growth through a deliberate strategy of merger and acquisitions. As a result, Constellation Software is now the 19th most valuable brand in Canada, up five places from last year’s ranking.
Canadian tech brands continue to innovate with high quality online products and services in the face of uncertain business circumstances with new virtual models of working through the pandemic. Brands in the Information Technology (IT) consulting and software sector such as CGI Inc. and Constellation Software have achieved considerable growth in value.David Haigh, Chairman & CEO of Brand Finance
Three years ago, Alimentation Couche-Tard began the mammoth project of rebranding their large global portfolio of brands under the Circle K global masterbrand. Circle K is now part of the fabric of the Canadian landscape, except for in Quebec, where the winking Owl and Couche-Tard nomenclature remains. Blue and red is gone now though in favour of red and orange; we are curious to see if Quebecers noticed (see image).
The Masterbrand strategy was a bold, expensive, but highly effective decision. Since 2020, the Circle K brand has grown 56% in value (up $4 billion to a total value of $11.1 billion). It is the fourth highest growth by any Canadian brand in this timeframe, which is reflected in a deserved rise to 6th place overall.
Many retail brands were able to flourish under pandemic conditions. On average, big grocery store brands grew by 23% in value since the start of the pandemic. Safeway has rallied an astonishing comeback, (69% brand value growth to $628 million), from almost falling completely out of the ranking pre-pandemic.
Lululemon’s athleisure offerings were a perfect fit for the pandemic lifestyle. The BC brand also took over from The Bay as Team Canada’s official clothing supplier, an apt metaphor for one brand’s ascension and the other’s fall. Canadian Tire was impacted by the initial lockdowns but bounced back this year, growing 28.4% (compared to last year’s 3.2%), to a total value of $4.7 billion.
Apart from calculating brand value, Brand Finance also determines the relative strength of brands through a balanced scorecard of metrics evaluating marketing investment, stakeholder equity, and business performance. Certified by ISO 20671, Brand Finance’s assessment of stakeholder equity incorporates original market research data from over 100,000 respondents in more than 35 countries and across nearly 30 sectors.
As part of calculating brand value, Brand Finance also determines the relative strength of brands. A brand’s strength is determined through a balanced scorecard exercise, where brands are benchmarked and indexed against their competitors on over 30 different brand strength related metrics. We refer to this scorecard as the Brand Strength Index™ (BSI).
Metrics in the BSI range from the amount businesses invest in their brands, to stakeholder equity metrics (momentum, awareness, familiarity, recommendation etc…), to the price premium a brand can command compared to its peers. The result is a composite score expressed as a number out of one hundred and a respective letter rating, which is based on the credit rating system. Our assessment of stakeholder equity incorporates original market research data from over 100,000 respondents in more than 35 countries and across nearly 30 sectors. This overall process is detailed and certified by ISO 20671.
For the first time in three years, Crown Royal is not the strongest brand in the table. The strongest brand is Scotiabank with a Brand Strength Index (BSI) score of 85.8 out of 100 and a corresponding AAA rating. The strength of the Scotiabank brand has increased by an impressive 6.9 points since the start of the pandemic, the most of any banking brand in Canada. Scotiabank’s brand strength growth is largely down to increased recommendation and NPS scores, where the bank vastly outperforms it competitors.
A&W is in second place with a BSI score of 85.3 out of 100 and a AAA rating. With over 1,000 branches across Canada, the brand is the second largest fast food burger chain in the country, after McDonald’s. A&W’s marketing strength is in its direct appeal to Canadians, which ‘feeds’ directly back into their phenomenal brand strength growth over the past two years.
Owing to travel restrictions, the third strongest Canadian brand WestJet suffered a pandemic induced decline. As travel bans are lifted globally the brand is going from strength to strength with a BSI score of 84 out of 100 and an AAA- rating. The airline prepares for a surge in demand as governments internationally allow travel.
Canadian Tire and TD Bank come neck and neck for the position of the fourth strongest brand in Canada with BSI scores of 83.6 out of 100 and AAA- ratings. The recent announcement of a $3.4 billion investment strategy, with a focus on building out its ‘Owned Brands’ products and offerings, signals an exciting future for the retailer and its portfolio of sub brands.