The no and low (NoLo) category continues to be a growth area within the alcoholic drinks sector. Increased health consciousness, a desire for more mindful drinking, and the lasting impact of the COVID-19 pandemic on drinking habits are driving consumers to opt for NoLo alternatives. NoLo beer has led the category for some time now. Data from Brand Finance reveals that non-alcoholic beer drinkers best associate Beck’s, Peroni, BrewDog, Corona Extra, and Heineken with good non-alcoholic lagers and ales, while Guinness is the leading brand overall in non-alcoholic beer.

So, who are these consumers and what draws them to NoLo alcoholic drinks? According to Brand Finance data, non-alcoholic beer drinkers over-index versus the general population across all interests and sporting activities. Most notably, drinkers of non-alcoholic beer are 68% more likely to be interested in sport and twice as likely (106%) to be interested in running, in particular. These beverages enable consumers to moderate their alcohol consumption, prioritise health, and reduce calorie consumption without giving up the social ritual of having a drink.

Brand Finance research also reveals that non-alcoholic beer drinkers have higher ad recall than the general population across the leading brands: Guinness, Peroni, BrewDog, Corona Extra, and Beck’s. A common thread among these brands is their strong presence in sports marketing, promoting alcohol-free versions as official partners of major events. Several beer brands leverage sporting event and club partnerships to promote their NoLo products, driving engagement with this rapidly growing consumer base.

For instance, since 2021, Heineken USA has served as the official import beer and hard seltzer partner of the Miami Dolphins and their home field, Hard Rock Stadium. The partnership highlights Heineken’s alcohol-free beer and is showcased through in-game promotions, branded bars, and sampling events.

According to Brand Finance research, US NFL fans who drink non-alcoholic beer at least once a month are 5% more likely to be familiar with Heineken, 23% more likely to consider the brand, and 64% more likely for it to be their preferred brand. Usage of the brand in the past 12 months is also 6% greater amongst these NoLo beer drinkers.

Alongside its wider sport sponsorships, such as its partnership with the UEFA Champions League since 2020, it comes as no surprise that Heineken is one of the top beer brands that all beer drinkers globally, not just NoLo beer drinkers, associate with having a good non-alcoholic alternative, at 13%.

Partnerships like these underscore the rise of NoLo drinks among sports fans as brands become increasingly conscious of responsible drinking and marketing. At the same time, these alcohol-free products often carry the same brand names as their alcoholic counterparts – an intentional move that allows brands to promote both products simultaneously. Similarly, alcohol-free products often maintain the same visual identity, where logos and packaging are nearly identical to that of beer brands’ traditional products – another tool strategically used to preserve brand awareness and recall.

AB InBev’s Bud Light has been the Official Beer Sponsor of the NFL for almost three decades, a partnership secured through to at least 2027. While its sponsorship does not currently feature or emphasise alcohol-free beer, this level of brand exposure to NFL fans, bolstered by special team-branded cans for 27 teams across the league, positions Bud Light with a strong opportunity to expand into the NoLo category should this become part of its broader strategy in the future.

Beyond the NFL, Carlsberg and Liverpool FC hold one of the longest standing partnerships in the English Premier League, and in recent years, Carlsberg’s 0.0% product has become more central to its strategy. This strategy includes playfully positioning its alcohol-free product as “The Only 0.0 We Want” on matchdays.

Similarly, Guinness, the official beer of the English Premier League, heavily integrates its 0.0% alternative into its broader strategy. As of the 2024/25 Premier League season, Guinness entered into a four-year agreement with the league with a focus on promoting its non-alcoholic beer and responsible drinking.

Budweiser stands as a prime example of how sponsorship deals can remain viable even in markets or territories with strict advertising or alcohol consumption rules. By leveraging its 0.0% product, the brand can maintain a strong presence where traditional beer promotion is not permitted.

During the 2022 FIFA World Cup in Qatar, where the sale and public consumption of alcohol was tightly controlled, Budweiser 0.0% was the only beer made available to in-person fans at any of the eight World Cup stadiums, allowing the brand to stay visible on a global stage exclusive to them. All of this contributes to higher ad recall, as highlighted by Brand Finance data, underlining the effectiveness of NoLo branding among soccer and sport audiences more generally.

Beyond the non-alcoholic alternatives offered by major beer brands, a new wave of purely non-alcoholic beer companies has popped up, including Lucky Saint, Bero, and Athletic Brewing Company.

Athletic Brewing Company stands out with great potential as a segment leader. Like the NoLo lines of multinational giants, brands are beginning to capitalise on sports partnerships to drive brand awareness and growth, albeit on a smaller scale. Rather than aligning with high-profile professional events, like those sponsored by Heineken or Guinness, largely due to smaller budgets, these brands are looking towards tactical market sponsorships.

In June 2025, Athletic Brewing Company became the women’s professional soccer team San Diego Wave FC’s first Official Non-Alcoholic Beer Partner, involving brand activations from fan and community events to social content with players across the club’s digital platforms. Similarly, in July 2025, English Premier League club Arsenal FC announced a multi-year extension of its partnership with Athletic Brewing Company, also as the club’s first Official Non-Alcoholic Beer Partner. As part of its renewed partnership, the two have signalled towards plans to launch a limited-edition, co-branded brew for the 2025/26 season. This special release is designed to offer fans a unique and memorable experience.

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The no and low (NoLo) category continues to be a growth area within the alcoholic drinks sector. Increased health consciousness, a desire for more mindful drinking, and the lasting impact of the COVID-19 pandemic on drinking habits are driving consumers to opt for NoLo alternatives. NoLo beer has led the category for some time now. Data from Brand Finance reveals that non-alcoholic beer drinkers best associate Beck’s, Peroni, BrewDog, Corona Extra, and Heineken with good non-alcoholic lagers and ales, while Guinness is the leading brand overall in non-alcoholic beer.

So, who are these consumers and what draws them to NoLo alcoholic drinks? According to Brand Finance data, non-alcoholic beer drinkers over-index versus the general population across all interests and sporting activities. Most notably, drinkers of non-alcoholic beer are 68% more likely to be interested in sport and twice as likely (106%) to be interested in running, in particular. These beverages enable consumers to moderate their alcohol consumption, prioritise health, and reduce calorie consumption without giving up the social ritual of having a drink.

Brand Finance research also reveals that non-alcoholic beer drinkers have higher ad recall than the general population across the leading brands, being Guinness, Peroni, BrewDog, Corona Extra, and Beck’s. A common thread among these brands is their strong presence in sports marketing, promoting alcohol-free versions as official partners of major events. Several beer brands leverage football event and club partnerships to promote their NoLo products, driving engagement with this rapidly growing consumer base.

Take Heineken, for example. Its partnership with the UEFA Champions League since 2020 has proven especially effective, promoting its 0.0% product alongside the world’s most-watched football tournament. According to Brand Finance research, European football fans who drink non-alcoholic beer at least once a month are 4% more likely to be familiar with Heineken, 10% more likely to consider the brand, and 34% more likely for it to be their preferred brand. Usage of the brand in the past 12 months is also 9% greater amongst these NoLo beer drinkers. It is therefore no surprise that Heineken is one of the top beer brands that all beer drinkers, not just NoLo beer drinkers, associate with having a good non-alcoholic alternative, at 13%.

Partnerships like these underscore the rise of NoLo drinks among sports fans, and football fans more specifically, as brands become increasingly conscious of responsible drinking and marketing. At the same time, these alcohol-free products often carry the same brand names as their alcoholic counterparts – an intentional move that allows brands to subtly promote both products simultaneously.

Similarly, alcohol-free products often maintain the same visual identity, where logos and packaging are nearly identical to that of beer brands’ traditional products – another tool strategically used to preserve brand awareness and recall.

Carlsberg and Liverpool FC hold one of the longest standing partnerships in the English Premier League, and in recent years, Carlsberg’s 0.0% product has become more central to its strategy. This strategy includes playfully positioning its alcohol-free product as “The Only 0.0 We Want” on matchdays.

Similarly, Guinness, the official beer of the English Premier League, heavily integrates its 0.0% alternative into its broader strategy. As of the 2024/25 Premier League season, Guinness entered into a four-year agreement with the league with a focus on promoting its non-alcoholic beer and responsible drinking.

Budweiser stands as a prime example of how sponsorship deals can remain viable even in markets or territories with strict advertising or alcohol consumption rules. By leveraging its 0.0% product, the brand can maintain a strong presence where traditional beer promotion is not permitted.

During the 2022 FIFA World Cup in Qatar, where the sale and public consumption of alcohol was tightly controlled, Budweiser 0.0% was the only beer made available to in-person fans at any of the eight World Cup stadiums, allowing the brand to stay visible on a global stage exclusive to them.

All of this contributes to higher ad recall, as highlighted by Brand Finance data, underlining the effectiveness of NoLo branding among football and sport audiences more generally. Beyond the non-alcoholic alternatives offered by major beer brands, a new wave of purely non-alcoholic beer companies has popped up, including Lucky Saint, Bero, and Athletic Brewing Company.

Among them, Lucky Saint stands out as a segment leader. Like the NoLo lines of multinational giants, these brands are beginning to capitalise on sports partnerships to drive brand awareness and growth, albeit on a smaller scale. Rather than aligning with high-profile professional events, like those sponsored by Heineken or Guinness, largely due to smaller budgets, these brands are looking towards tactical market sponsorships.

For example, in July 2025, Arsenal FC announced a multi-year extension of its partnership with Athletic Brewing Company as the club’s first Official Non-Alcoholic Beer Partner.

As part of its renewed partnership, the two have signalled towards launching a limited-edition, co-branded brew for the upcoming 2025/26 season, offering fans a unique and memorable experience.

Brand Finance Football 50 2025

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The no- and low (NoLo) category continues to be a growth area within the alcoholic drinks sector. Increased health consciousness, a desire for more mindful drinking, and the lasting impact of the COVID-19 pandemic on drinking habits are driving consumers to opt for NoLo alternatives. NoLo beer has led the category for some time now. Data from Brand Finance reveals that non-alcoholic beer drinkers best associate Beck’s, Peroni, and BrewDog with good non-alcoholic lagers and ales, while Guinness is the leading brand overall in non-alcoholic beer.

So, who are these consumers and what draws them to NoLo alcoholic drinks? According to Brand Finance data, non-alcoholic beer drinkers over-index versus the general population across all interests and sporting activities. Most notably, drinkers of non-alcoholic beer are 68% more likely to be interested in sport and twice as likely (106%) to be interested in running, in particular. These beverages enable consumers to moderate their alcohol consumption, prioritise health, and reduce calorie consumption without giving up the social ritual of having a drink.

Brand Finance research also reveals that non-alcoholic beer drinkers have higher ad recall than the general population across the leading brands, being Guinness, Peroni, BrewDog, Corona Extra, and Beck’s. A common thread among these brands is their strong presence in sports marketing, promoting alcohol-free versions as official partners of major sporting events.

Take Guinness, for example. Its partnership with the Six Nations has proven especially effective. According to Diageo, and Nielsen data, 32% of Six Nations fans said the brand’s involvement with the tournament drove them to try Guinness 0.0% for the first time. Heineken has adopted a similar strategy with the UEFA Champions League, promoting its 0.0% product alongside the world’s most-watched football tournament since 2020.

Similarly, Corona launched a landmark deal as the first official global beer sponsor of the 2024 Summer Olympic Games in Paris. Their alcohol-free beer, Corona Cero, stood up before a global audience.

These partnerships underscore the popularity of NoLo drinks among sports fans. At the same time, these alcohol-free products often carry the same brand names as their alcoholic counterparts – an intentional move that allows brands to subtly promote both products simultaneously.

All of this contributes to higher ad recall, as highlighted by Brand Finance data, underlining the effectiveness of NoLo branding among sport audiences.

Beyond the non-alcoholic alternatives offered by major beer brands, a new wave of purely non-alcoholic beer companies has popped up, including Lucky Saint, Bero, and Athletic Brewing Company. Among them, Lucky Saint stands out as a segment leader. Like the NoLo lines of multinational giants, the brand has capitalised on sports partnerships to drive brand awareness and growth. However, rather than aligning with high-profile professional events, such as those sponsored by Guinness, Corona, or Heineken, Lucky Saint has strategically focused on mass participation events like Hyrox competitions or half marathons. As consumer preferences continue to shift toward mindful consumption, the NoLo segment is well-placed for sustained growth.

Brand Finance Alcoholic Drinks 2025

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Perceptions of Guinness as a cool beer brand have tripled among young people since 2023. Traditionally, Guinness has held a strong association with older, male drinkers, particularly in its core markets like Ireland and the UK. Its image was rooted in ideas of masculinity and strength, reinforced by the perception that each pint was full of iron. While this identity helped define the brand, it also narrowed its broader appeal. In recent years, however, Guinness has worked to both challenge and reimagine those ideas to expand its consumer base. A key driver of its brand value growth has been rising global demand, reflected in late 2024 when Guinness breweries were operating at maximum capacity to grapple with supply shortages. This success even led to rumours surfacing in early 2025 about a potential sale of the brand by its parent company, Diageo, which it quickly dismissed.

In line with rising demand, Brand Finance research reveals a notable shift in consumer perception and engagement between 2023 and 2025. Awareness, consideration, and perception have all seen significant gains. Further, Brand Finance research also shows that Guinness has gained significant traction among younger consumers (18-24), noting a marked shift in perceptions of the brand as ‘cool’ (22% in 2023 versus 67% in 2025) and ‘modern’ (33% in 2023 versus 60% in 2025), positioning it well for future brand growth (see table).

According to Brand Finance data, Guinness has also become increasingly popular with young women. Familiarity increased from 78% in 2023 to 86% in 2025, while consideration rose from 67% to 77%, reflecting the brand’s success in connecting a more diverse and engaged audience. Guinness’ brand value growth can also be attributed to its alignment with changing drinking habits. Guinness has successfully adapted to evolving consumer trends, particularly the rise of more mindful, health-conscious drinking. With fewer calories than many lagers and a considerable foothold in the non-alcoholic drinks sector since launching Guinness 0.0% in 2021, Guinness has confidently positioned itself as a future-proof brand. According to Brand Finance data, in 2025, 34% of UK non-alcoholic beer drinkers associate the Guinness brand with having a good alcohol-free alternative.

With little competition in the stout market and a well-established foothold in the non-alcoholic beer sector, this data shows that Guinness is building a future-proof, forward-thinking brand. In 2025, Guinness ranks as the 10th most valuable beer brand globally, with its brand value rising 32% to USD3.4 billion. It also remains the most valuable Irish brand in 2025 - a position it has held since 2022. In terms of brand strength, Guinness ranks 13th among global beer brands, with a Brand Strength Index (BSI) score of 79.4 out of 100.

Brand Finance Alcoholic Drinks 2025

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Tariffs could hurt American consumers more than their European counterparts.

Brand Finance research finds that U.S. consumers rate European brands as more reputable and admirable that American brands. As protectionist measures make it harder for European brands to compete in the U.S., Americans risk missing out on the brands they love most. In the current market environment, where brand perception is closely linked to values and identity, restricting access to popular international brands could have lasting consequences for nations’ economic influence, reputation and Soft Power.

Impact on different sectors

Brand Finance data reveals that U.S. respondents see European brands as more luxurious (30% vs. 18%), more stylish (33% vs. 23%), and a greater symbol of success (26% vs. 19%) compared to U.S. brands. These findings highlight the strength of consumer admiration, and what may be lost if access to these brands continues to narrow. The impact of these policies is especially pronounced in the luxury and premium sector, where U.S. tariffs - reaching up to 50% on European imports - are placing significant strain on iconic fashion houses such as Louis Vuitton, Chanel, Dior, and Hermès.

These brands are all ranked among the top 20 most valuable in Europe in 2025. Brand Finance data finds that Louis Vuitton earns perfect scores of 10 in the credibility metric – including for reputation and reliability - while Dior, the third-strongest brand in Europe, scores perfect 10s in reputation, selection, and price acceptance, underscoring U.S. consumers’ continued willingness to pay a premium for trusted European luxury.

In response to policy shifts, some luxury brands are considering relocating production to the U.S. to avoid tariffs. However, this move could come at a cost to brand equity. The ‘Made in Europe’ label is a core part of these brands’ appeal, tied closely to artisanal heritage and craftsmanship. Losing this could undermine the strength and iconic legacies of these luxury brands in the future.

According to Brand Finance data, European consumers are actually more aware of and more likely to use U.S. brands than vice versa, with brand awareness averaging 65% compared to 49% among American consumers for European brands. Usage follows a similar trend (26% vs.16%).

However, according to an assessment by the European Central Bank, U.S. trade tariffs on European products are prompting many European consumers to reconsider their purchases, with a significant number actively choosing to move away from U.S. products and services. This shift is described as decisive and potentially long-term, suggesting that the impact of tariffs extends beyond price to influence broader attitudes toward American brands.

Boycott movements are also gaining traction across Europe, and their impact is already visible. Tesla, one of the most prominent U.S. brands in Europe, is a notable example. As of April 2025, Tesla has seen its sales half in the EU, UK, and EFTA countries - a nearly 50% decline compared to the previous year. Data from Brand Finance shows that Tesla's brand value fell by 26% in 2025, decreasing to USD42.9 billion.

Even more concerning is Tesla’s drop in brand strength, which declined by over 19 points to 64.9 out of 100. Tesla has experienced notable declines in reputation scores across key European markets - including Germany, the UK, and the Nordic countries – as well as major drops in usage and recommendation, highlighting eroding consumer trust and the brand's weakening position in Europe.

The threat to Soft Power

Trade wars and escalating tariffs risk more than just economic disruption - they can also undermine a nation’s Soft Power. This is especially true in Europe, where brand reputation, cultural influence, and perceived quality are key pillars of global appeal, according to Brand Finance’s research.

The 2025 Global Soft Power Index shows that Europe still holds a strong position in global perceptions: several European countries, including Italy, France, Germany, Sweden, and the UK, rank highly among U.S. respondents for producing ‘products and brands the world loves.’

These brands – from BMW to Rolex and IKEA - carry deep cultural resonance and showcase European identity and prestige abroad. Additionally, the UK, Ireland, and Italy top the ranking for ‘rich heritage,’ among U.S. respondents, a further testament to Europe's broad cultural appeal.

Should tariffs and political tensions persist, Europe could find its most intangible but powerful assets – its reputation, culture and heritage, and brand equity - gradually weakened on the global stage, potentially weakening its Soft Power and international influence in future rankings.

The U.S. also faces significant risks to its Soft Power because of protectionist trade policies. Historically, America’s global influence has been rooted in both its economic strength and its advocacy for open markets and international cooperation.

Brand Finance data shows that the U.S. has ranked in the global top three for Business & Trade since 2021, including being among the top three for ‘products and brands the world loves.’

However, in 2025, it slipped two places to fifth for being ‘easy to do business’ with, and its overall Reputation dropped four ranks to 15th. The impact of current trade policies and their consequences on the U.S. Soft Power dominance remains to be seen.

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From polo and sailing to golf and tennis, luxury brand sponsorships consistently focus on elite disciplines. While it’s easy to assume these partnerships are based on prestige, Brand Finance data indicates that people with higher incomes exhibit specific behaviours that make certain sports a prime opportunity for brands that understand how to engage this in-demand audience.

First, it’s more difficult to connect with affluent individuals through traditional marketing and advertising because they exhibit lower ad recall. For example, Brand Finance data reveals that higher income individuals are 23% less likely to recall seeing advertisements for luxury automobiles, but they are 121% more likely to follow Formula E. This creates a salient opportunity for brands to strategically position themselves to engage certain affluent consumers through the right sport sponsorship.

Brand Finance data shows higher income individuals are 78% more likely to follow golf and show increased engagement with sailing (59%) and tennis (29%). When applied to marketing strategies, this increased following translates into real brand uplift.

These strategic partnerships between luxury brands and elite sporting events offer more brand visibility than many other broader commercial sponsorships by creating greater connections between spectator and brand than stand-alone ads. They place the luxury brand within exclusive environments that mirror their own values, such as resilience, precision, and excellence.

Rolex’s long-standing partnership with Wimbledon as its official timekeeper began in 1978 and provides a clear example of a strategic, values-led alignment with an elite sports brand. According to Brand Finance data, in the last five years (2020 – 2025) since the tournament took a hit from cancellation due to the pandemic, Rolex’s brand value has more than doubled, increasing 138%.

While these partnerships offer brand equity, the benefits go beyond branding to financial results. Again, using Rolex as an example, the luxury watchmaker partners with high profile golf tournaments: the four men’s majors, the five women’s majors, and the leading tours.

Brand Finance data also shows that, among golf fans, Rolex notes a 36% increase in brand recognition and a 12% increase in preference. By contrast, brands like Tissot and Tag, which don't sponsor golf, see only an 11% increase in recognition and a 7% increase in preference among golf fans. These figures underscore the scale of Rolex’s investment, having entered an estimated USD192.95 million agreement with the PGA European Tour.

Ultimately, luxury and premium sports sponsorship goes beyond prestige. It serves as a strategic tool to engage hard-to-reach target audiences through the experiences that resonate the most.

To fully realise the grand growth and financial benefits of these partnerships, brands turn to more lifestyle-driven marketing techniques that align with the passions and aspirations of higher income individuals. World-renowned sporting events provide the stage for that strategy, creating brand equity and affinity and tangible financial results, while bridging the gap where conventional marketing falls short.

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Online gambling in the U.S. is now a high-stakes race to secure market dominance.

As iGaming and online sports betting become legal in a rapidly growing number of states, the brand value of key players such as FanDuel and DraftKings has skyrocketed, exemplifying the transformative power of strategic branding in a dynamic and fiercely competitive sector.

The context: A new frontier

The U.S. gambling market, traditionally dominated by physical casinos and state lotteries, has experienced a seismic shift over the past decade. The majority of Americans now live in states that have legalised online sports betting and iGaming over the past decade.

This dramatic expansion has turned the U.S. into a frontier market, where brands must operate with a dual focus: acquiring customers in a burgeoning space and building long-term brand loyalty. Unlike more mature markets, where online gambling is substantially saturated, the U.S. offers a unique opportunity for companies to capture and retain customer allegiance.

That allegiance is often based on customer “stickiness,” a phenomenon where customers are likely to stick with a brand as long as the experience meets their expectations.

Unlike consumer goods, where customers can easily choose a different brand any time they shop, gambling requires a level of set up that makes a customer less likely to leave a brand once they’re invested in the platform, have funds deposited, and are familiar with its features and user experience.

FanDuel: The pioneer

FanDuel’s growth trajectory offers a compelling case study in brand value. Originally focused on fantasy sports, FanDuel leveraged its existing customer base and brand equity to dominate the online sports betting space:

• Brand awareness campaigns:
  FanDuel has invested heavily in visibility, deploying a mix of television ads, social media campaigns, and high-profile sponsorships.
• Seamless customer experience:
  The brand's app interface and functionality have received widespread acclaim, helping to solidify user trust and engagement.
• Leveraging analytics data:
  By using customer data to personalise experiences and refine better recommendations, FanDuel has created a sticky ecosystem that appeals to casual and frequent bettors alike.

FanDuel's brand value has doubled since 2023, underpinned by double-digit revenue growth, and growing brand equity among consumers.

DraftKings: The contender

DraftKings, FanDuel’s closest competitor, has charted
a similar path of fast growth. Its entry into the Brand
Finance Global 500 ranking for the first time this year
is a testament to its strategic brand-building efforts.
Notable aspects of DraftKings’ approach include:

• Strong differentiation:
  By maintaining a distinctive focus on innovative features, DraftKings has carved out a unique market position. For example, its gamified elements and live betting interfaces appeal to a younger demographic.
• High-impact partnerships:
  Strategic partnerships with sports leagues, individual teams, and even celebrities have amplified brand recognition.
• Early-mover advantage:
  In states where online gambling was legalised early, DraftKings was often among the first to launch, giving it a head start in acquiring loyal customers.

Lessons from mature markets

Comparing these brands to established U.K. incumbents like Bet365 and Sky Bet reveals stark differences. Many U.K. brands have relied on years of trust and sustained reputation-building.

For example, Bet365’s focus on competitive odds and transparency has made it a favourite among professional gamblers. However, in the U.S., where brand awareness campaigns dominate, the focus is less on pricing and more on customer acquisition and engagement.

Whereas FanDuel (74%) and DraftKings (82%) have increased awareness in the US in each of the past 3 years, this still trails that of bet365 (92%), William Hill (92%) and Paddy Power (90%) in the UK.

Similarly, both US leaders convert awareness into familiarity at a lower rate (~70%) than their UK counterparts (~85%). This suggests that their mass marketing is getting eyeballs but is not yet as effective at improving consumer understanding.

Strategic brand value drivers

Several factors underpin the growth of brand value in the U.S. online gambling space:

1. Massive advertising budgets:
   The U.S. market is flooded with marketing spend as brands race to acquire users. For example, DraftKings reportedly spent over USD500 million on marketing in a single year, emphasising the scale of the battle for customer attention. This is viable because of the expected lifetime value of acquired, propped up by the relatively high wealth of American consumers and the stickiness factor described above.
2. Technology integration:
   The seamless integration of technology, from apps to wearable devices, enhances customer experience and drives engagement. Real-time updates, personalised notifications, and loyalty rewards contribute to the perception of value. The American brands are built upon more recent tech platforms, while brands operating in more established markets are mostly based upon legacy platforms dating back as much as twenty years.
3. Cultural adaptation:
   Recognising the cultural nuances of individual states has allowed brands to tailor their offerings and marketing strategies effectively, ensuring relevance and resonance with local audiences.

Challenges and risks

Despite these successes, the industry faces challenges
that could impact long-term brand value:

• Sustainability of marketing spend:
  Current spending levels on customer acquisition are unlikely to be sustainable in the long-term – once the consumer market reaches saturation, it is unlikely to be viable to invest in brand building activities at such high levels. Brands will need to pivot towards retention strategies to ensure long-term profitability.
• Regulatory scrutiny:
  With rapid growth comes increased oversight. Brands must navigate a complex web of state and federal regulations, ensuring compliance while maintaining operational flexibility. The extremely high visibility of marketing campaigns in recent years may provoke a regulatory backlash from legislators.
• Market saturation:
  As more brands enter the space, differentiation will become increasingly difficult, potentially driving down profit margins.

The future of brand value in U.S. online gambling

The trajectory of U.S. online gambling brands offers a fascinating insight into how markets evolve under conditions of rapid change. While FanDuel and DraftKings currently lead, the long-term winners will be those who can transition from aggressive customer acquisition to meaningful brand loyalty. Leveraging technology, refining customer experiences, and maintaining trust will be critical.

As the dust settles on this gold rush, the U.S. may well emerge as the world’s most dynamic online gambling market, not just in size but in the sophistication of its brands. The lessons learned here could very well influence the global gambling industry for decades to come

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Franchise agreements are a common strategy in the hotel industry, offering a pathway for rapid expansion without the need for significant capital investment. Under a franchise agreement, the franchisor (the hotel brand) allows the franchisee (the hotel owner) to operate a hotel under its brand name, following its standards and guidelines. In exchange, the franchisee pays fees to the franchisor, which may include initial franchise fees, ongoing royalties, and marketing contributions. In some cases, the franchisor also provides operational services through a management contract.

This model is particularly appealing to franchisees because it provides instant brand recognition, access to a proven business model, and the support of a larger network. For individual hotels, this can mean access to global distribution systems, loyalty programs, and marketing initiatives that would be challenging to achieve independently.

Some of the biggest names in the hotel industry, like Marriott International and Hilton Worldwide, rely heavily on franchise agreements. Marriott operates nearly 9,000 properties globally, spanning from luxury to budget segments, with over 6,500 of these being franchised. Similarly, Hilton boasts a global portfolio of nearly 7,800 hotels, with more than 6,600 of them operated as franchises, offering a wide range of brands across various market segments.

These major franchises leverage their global reach, strong brand recognition, and comprehensive support systems to drive growth and maintain consistency across their properties.

Growth of the franchise model

The popularity of franchising in the hotel industry has seen a significant rise in recent years. According to McKinsey, the proportion of franchised hotels increased from 66% in 2012 to 72% in 2023. This shift towards franchising allows hotel companies to focus on expanding their brand presence and generating consistent revenue streams, while minimising the liabilities associated with property ownership. The trend has been further accelerated by the COVID-19 pandemic, as hotel owners and investors increasingly value the structured support and established business models that franchise partnerships offer. However, this comes with trade-offs, including adherence to the franchisor's rules and regulations, which can limit creativity and operational flexibility. Despite these constraints, the evolving landscape has made franchising the preferred operating model for many global hotel chains.

Why do brands use franchise agreements?

Quicker growth

A franchise model allows hotel brands to expand their physical presence more rapidly because they do not need to acquire or build the physical assets themselves. This asset-light approach is particularly beneficial for mass-market hotel brands aiming to build awareness quickly. Regular travellers often value the consistency of being able to stay in the same brand of hotel in different locations, which in turn helps the brand build loyalty. This growth strategy contributes to higher brand awareness and familiarity for franchised hotels, with Brand Finance’s research highlighting a significant advantage in both consumer awareness (73% vs. 69%) and familiarity (54% vs. 51%) compared to owned hotels. This approach also means that franchise hotels are perceived as being widely available (27% vs. 22%) and often in better locations (30% vs. 27%) than their owned counterparts.

Lower asset requirement

By not owning all the hotels in their portfolio, brands can maintain a leaner balance sheet, which requires less financial capital for growth. This reduction in capital needs leads to cost savings in both personnel and property-related expenses. Additionally, because property values can fluctuate with economic cycles, a franchise model mitigates some financial risk, allowing the hotel brand to concentrate on customer acquisition and retention efforts. These financial efficiencies also translate into better value for money for consumers, with franchised hotels often perceived as more cost-effective (32% vs. 24%) compared to their owned counterparts, making them particularly appealing to cost-conscious travellers.

Flexibility

Building new properties from the ground up can be time-consuming. The franchise model provides the flexibility to respond more quickly to changing consumer trends, whether by adjusting geographical locations or modifying the types of hotels offered. For example, the rise of remote work has changed traveller needs, and a franchise model allows hotels to adapt more swiftly to these trends. However, it's worth noting that hotel brands can also achieve similar flexibility by purchasing or adapting existing buildings, though this often involves negotiating additional costs and time.

Access to unique properties

Franchise agreements can provide hotel brands access to unique or historic properties, which might not be possible with new builds. While new properties can incorporate the latest amenities, franchises can leverage the charm and prestige of notable locations, making this model particularly attractive for upscale luxury brands.

Why some brands avoid the franchise model

Greater control over quality & consistency

One of the main risks of the franchise model is the potential loss of control over quality and consistency. Franchisees may not always maintain the brand's intended standards, whether in terms of hotel appearance or customer service. An owned hotel model allows for stricter oversight and often results in higher perceived quality and customer satisfaction. Additionally, weak franchise agreements can lead to disputes over responsibilities, affecting both customer engagement and the timely upgrading of hotel facilities. This is reflected in data showing that owned hotels are seen as more luxurious (28% vs. 19%), offering better food/restaurants (20% vs. 16%) and being more stylish (28% vs. 23%).

This can translate into strong financial returns for the hotel owner. These strong perceptions of quality and luxury mean that consumers are more likely to accept a price premium. Consumers were far more likely to view a majority owned hotel brand as “expensive, but worth the price” (33% vs 27%). This reflects that the extra costs required when the hotel is fully owned can be offset by higher prices.

Additionally, while franchising allows brands to expand rapidly, it also means they only receive a fee from the franchisee, rather than the full revenue generated by the hotel. This limits the potential profit compared to owning and operating the hotel directly.

No risk of partners switching to another franchise chain

A significant risk with the franchise model is that franchisees, as independent owners, may be tempted to switch to another franchise chain. This possibility can be used by the franchisee as leverage to negotiate more favourable terms, potentially reducing the franchisor's profit margins. Moreover, any consumer loyalty built up in a particular property might be transferred to another brand if the franchisee decides to switch affiliations.

A notable example of this occurred after Marriott's acquisition of Starwood Hotels & Resorts in 2016. Some Westin hotels, previously under Starwood, transitioned to other franchise brands like Hilton or Hyatt when their franchise agreements ended, as the franchisees sought better terms or brand alignment.

Easier to control fewer stakeholders

Brands that own and operate their hotels can maintain greater control over their employees and stakeholders. These employees receive direct training from the company and are more likely to adhere strictly to brand and operational guidelines. Unlike franchisees, who are partners rather than direct employees, staff at owned hotels are more aligned with the brand’s values and objectives. Centralised training and onboarding further ensure consistency across the brand’s operations.

Industry trends and future outlook

As the hotel industry continues to evolve, the franchise model is likely to remain a dominant strategy for expansion. Several factors contribute to this trend:

Emerging markets: Franchising is expected to see significant growth in emerging markets, where global hotel brands are expanding their presence to cater to the growing middle class. Countries in Asia, Africa, and Latin America present lucrative opportunities for hotel chains to establish their brands through franchising, leveraging local knowledge while maintaining brand standards.

Technology and consumer preferences: Advances in technology are also shaping the future of franchising. The rise of online booking platforms, mobile apps, and customer relationship management systems allows franchisors to maintain greater control over brand consistency and customer experience, even in franchised properties. Additionally, the growing trend towards personalised travel experiences may push franchisors to offer more flexible and customised franchise models that cater to niche markets, such as eco-tourism or wellness retreats.

Economic conditions: Economic downturns or shifts, like those triggered by the COVID-19 pandemic, often accelerate the adoption of asset-light models, including franchising. In uncertain economic environments, hotel brands may prefer the lower financial risk associated with franchising, while independent owners seek the security of a well-known brand to attract customers.

Comparing franchising across industries

The franchise model is not unique to the hotel industry, it is widely used in other sectors. However, the application and impact of franchising can vary significantly across industries.

In the fast-food industry, franchising is almost synonymous with business expansion. Brands like McDonald’s and Subway have built their empires largely through franchising, with strict controls over every aspect of the business, from menu offerings to restaurant layout. The hotel industry, while also focused on brand consistency, faces more complexity due to the larger scale of operations and the need to adapt to different geographic and cultural contexts.

In retail, franchising allows brands to expand rapidly without the need for significant capital investment, much like in the hotel industry. However, retail franchises often deal with more standardised products, whereas hotels must manage a broader range of variables, including service quality, customer experience, and property maintenance. This makes the franchise model in the hotel industry more challenging but also potentially more rewarding.

Balancing growth and control

Franchising is a powerful strategy for hotel brands aiming for rapid expansion with minimal capital investment. It offers significant advantages, including increased brand awareness, financial efficiency, and the ability to scale quickly. This is evident in Brand Finance’s annual ranking, where 8 of the top 10 most valuable hotel brands are franchised, highlighting its effectiveness in driving brand visibility and sales.

While owned hotels can deliver a more curated, luxurious experience, franchising often leads to greater brand value and higher returns for shareholders. Franchised hotels benefit from enhanced brand equity, which combines mental availability and financial value. Success in any model, however, requires careful tracking of consumer perceptions to ensure alignment with brand goals and market demands.

Ultimately, franchising excels in driving awareness—an essential factor in boosting sales and capturing market share. For brands focused on maximising shareholder value, a well-executed franchise model offers scalability and visibility that can translate into long-term growth and success.