Yesterday in New York, Interbrand announced its global rankings of the Best Retail Brands.
Using the ISO recognised brand valuation methodology, developed nearly thirty years ago, Interbrand annually rates the top retail brands.
Yet again Walmart dominates with a value of $141 billion (R1.300 billion), enough to gobble up most, if not all, of the JSE! Now very active in South Africa and increasingly Africa, through Massmart (Game, Makro, Dion, Builders Warehouse etc.)
Reading through the ratings, it is surprising that apart from Walmart none are active in Africa e.g., after Walmart comes Target ($25m), The Home Depot ($23m), Amazon.com ($18.6m), although the latter is of course global.
In the UK Tesco ($10.8m) dominates, followed by Marks & Spencer ($6.5m), Boots ($3.3m). In France it's Carrefour ($10.3m), Germany: Aldi ($2.9m) and Australia: Woolworths (no relation to South Africa) ($4.6m).
While consumer confidence continues to ebb and flow, energy abounds in the US retail sector. The total brand value of this year's top 50 brands is up 1.8%. Of the brands that are on the list again this year, 36 of them increased brand value while only 11 declined. The average brand on the list increased its value by over 6%, up from 4% in 2012. The threshold to earn a spot on the US ranking has increased to US$836 million; last year it took a brand value of US$771 million to make the top 50.
The South African retail scene has shown considerable change of late. Shoprite continues to power ahead, Massmart is now majority owned by Walmart, whilst Woolworths, Mr Price and Clicks have all shown strong growth. Brands that are struggling include Pick n Pay and Edgars. Digital offerings are gaining in importance with Kalahari leading the way. From a branding perspective there is much local fragmentation and huge potential for consolidation. Amazon.com's rapid climb from number 9 in 2012 to number 4 in 2013 is further proof that South African retailers must offer a sophisticated e-commerce model in order to compete on a global scale.
Each year, Interbrand studies what makes retail brands successful and documents their challenges. The brands that succeed amongst the tumultuous backdrop of the retail industry have four things in common:
- Valuable retail brands monitor customer's changing needs. In the race for relevance that is, providing customers with a reason to choose a brand - the strongest relentlessly pursue knowledge about their consumers and incorporate those insights into their everyday behavior. With economic power distributed across an ever-growing portfolio of touchpoints, customers - not the brands themselves - set the rules of engagement.
- Leaders build a culture of efficient decision-making. The pace of retail and customer expectations around speed continues to increase. To respond, executives need to build cultures, processes and systems that enable quick decisions. This isn't just about assortment adjustments. It's about organisational commitment to moving at the speed of the retail world to remain competitive.
- It's understood that experience extends beyond the store. Even the definition of retail is changing. "Retail" no longer refers to physical stores; it refers to the complete experience to products. Retailers witnessing big gains this year have committed to this holistic view of experience. Rather than antiquated methods of maximising stores at the expense of other channels, top brands think in terms of groups of touchpoints and the optimisation of experience.
- The best continuously optimise, scale and measure. The need to move quickly can pressure retail leaders to abandon their commitment to the tasks aligned with optimisation, scaling and measurement. Many do achieve top speed, as the industry demands, where it becomes challenging to evaluate on the fly. Across the top retailers, commitment to ongoing, meaningful measurement and refinement is clear.
"Outstanding retail brands, such as those on our list, are marked by their ability to transform the ordinary into the desirable", says Jez Frampton, Interbrand's Global Chief Executive Officer. "It is these exceptional brands that start new conversations, innovate new models and inspire us all to participate in the cultural experience we call shopping. Congratulations to this year's Best Retail Brands - we can't wait to see what's (Quite literally) in store in the year ahead". Comment by Douglass de Villiers, Group CEO at InterbrandSampson: "Africa as a retail space, with six of the top ten fastest growing global economies, is ripe for development and a mouth watering prospect for all those in mature and stagnant markets. Now is the time to take bold moves towards becoming global contenders". Top 20 Most Valuable US Retail Brands for 2013
|2013 Rank||Brand||2013 Brand value $m %||Change (Brand Value)|
|3||The Home Depot||$22,940||4%|
|19||Tiffany & Co||$5,159||15%|
Founded in 1974, Interbrand is one of the world's largest branding consultancies. With nearly 40 offices in 27 countries, Interbrand's combination of rigorous strategy, analytics and world-class design enables it to assist clients in creating and managing brand value effectively across all touchpoints in all market dynamics. Interbrand is widely recognised for its Best Global Brands report, the definitive guide to the world's most valuable brands, as well as its Best Global Brands report, which identifies the gap between customer perception and a brand's performance relative to sustainability. It is also known for having created Brandchannel.com, the award winning resource for brand marketing. For more information on Interbrand, visit Interbrand.com
. About InterbrandSampson
Based in Johannesburg, with offices in Accra, Gaborone, Lagos and Nairobi, we act as a hub for Africa. Working in close partnership with our clients we combine the rigorous strategy and analysis of brand consulting with world-class design and creativity. This reach enables us to conduct global research, investigate emerging trends, introduce brands across markets, and better service our clients where they want to do business. Interbrand Sampson has won FinWeek's AdReview 'Best Branding and Design Agency' in 2009 and 2010. Interbrand is a wholly owned subsidiary of the Omnicom Group, the global leader in marketing and corporate communications.