Professional Documents
Culture Documents
Brands 2009
Global perspectives on a
changing marketplace
Regional challenges,
trends, and insights
The remaking of retail
CPG: stand out or
get out
Creating and managing Getting more for less
www.interbrand.com brand value
TM
Contents
Weathering
p01 Introduction: weathering the storm
A letter from Jez Frampton.
p03 Overview
p30 The remaking of retail by
Lee Carpenter and Greg Silverman
Resources are limited and tension is high.
The time is ripe for retail innovation.
the storm
Creating and managing brand value. Jez Frampton
p32 How we value retail brands
p04 Building retail brands by Criteria for consideration and methodology.
Lee Carpenter, Jean-Baptiste Danet
and Stuart Green p34 The Best Retail Brands 2009
A look at retail challenges and the future of Profiles of the most valuable retail brands in
retail brands in three regions. the U.S., Canada, Mexico, and Europe.
Making sense of the economic turmoil of and the all important human interaction. Their habits and behaviors will continue to
recent months will take time and a degree I would say, a recipe for great innovation adapt to the technologies available to them
p08 Creating value in-store by Kelly Crouch
of hindsight that most business leaders and opportunity! and to the truths about our lifestyles and
and Emily Grant Appendix
just don’t possess at the moment. Our habits exposed by the recent economic,
Why brands should focus on shoppers’ needs
attention must focus on the immediate As the rankings in this magazine show, social, and environment events. Getting a
in downturns. Commonly asked questions
needs of businesses and brands in real retailers are now actively managing their grip on this fast changing world and feeling
time. History alone will deal with the rest. brands and creating valuable business assets. confident that your brand can sail through
p10 Getting more for more by About Interbrand and our Best Retail
And the world of branding has changed too. these stormy seas requires a strategy that
Bruce Dybvad and Rune Gustafson Brands study
We’ve focused on retail in this edition Data is used to build the business case for is based on today’s truths rather than
Cutting price in downturns isn’t an answer—
of the Interbrand magazine because it brands, to highlight the initiatives within a yesterday’s assumptions. It requires a
focus on the shopper experience instead. Contact us
is a powerful barometer of economic strategy, and to build ROI models into brand strategy that is delivered in stores and lives
sentiment. The dramatic differences in programs, not to mention the monitoring in customers’ heads, not well intentioned
p14 Best practices by Lynn Gonsior and
the fortunes of the various High Street or and active management of brand value documents and plans.
Françoise Novel
Main Street players highlight the mood of creation. This means that brand management
Top retailers are growing more sophisticated
the day: Are you in a position to weather, can live happily within the highly accountable I hope you find the thinking in this magazine
in their approach to finding growth. Their
or wither in, the storm? world of retail using data and value as the useful to you, your business, and your brands
insights can help your brand.
bridge between the financial and commercial as we all continue to tackle the challenges
A retailer once told me that he didn’t have streams of activity. before us.
p16 The crisis paradox by Josh Feldmeth time to build his brand; he was too busy
Markets are contracting and results are meeting the needs of his customers and his Retail has certainly been deeply impacted by Regards,
under pressure. Intelligent branding is business. At Interbrand we would view this the economic realities of our times. But what
required to extract more value from invested as the very essence of building a brand, but better market is there to pick itself up and
brand assets. it’s easy to see why the marriage between fight back?
retailers and brand management hasn’t
p20 Break away from the pack always been easy. Branding was historically While cost-cutting has formulated the bulk
by Fred Richards and Bertrand Chovet viewed as the “lipstick on the pig,” a graphical of businesses’ reactions to the downturn,
Differentiation at shelf level is key to veneer which added questionable value in the we are now recognizing that demand creation
standing out in saturated categories. face of global logistics and sourcing. But as is the required antidote. Demand can be
markets have changed, so have attitudes. created without relying on discounting which
p24 Fast moving consumer goods in hinders a business, erodes margins, and
regional markets by Richard Veit Differentiation is the essence of good places a business under increasing pressure.
Regional brands in growth markets have business in any crowded market; the ability Demand creation requires us to step away
the upper hand—but only if they work on to influence demand beyond the tangible, to from the crowd, to do things differently in our
building innovative brand propositions. go beyond the table-stakes of convenience, quest to stand out, and own a clear position Jez Frampton
quality, service, and the like, into the realms in a market. Global Chief Executive
p28 Shifting winds by Burton Blume of the unique. Brands are the way we do Interbrand
and Jonathan Chajet business; the factor that makes our service Perhaps retailers need to better understand
Trends and insights for the future of Asia’s offer, our product line-up, our culture, and of how their brands drive value and what
retail markets. course, our language and appearance more actions should be taken to ensure that
desirable over the competition. their brands are readied for the market of
tomorrow, as well as the market of today.
Retailers are perfectly placed to build truly
great brands. They have many rich data All around us the world is changing.
points: physical experiences involving To only view these changes through the
numerous opportunities to create eyes of the economy is dangerously one-
uniqueness, including service, process, dimensional. Consumers’ attitudes have
product mix, layout, ambience, culture, changed and will continue to change.
retail brands and retail wider choice of products and services have
all been key factors in changing consumers
attitudes towards shopping and how they
spend their money.
a sophisticated business
consisted for the most part, of small family
run shops and market traders (the exception In the same vein, themed malls, consisting
being Japan’s very successful department of shops, restaurants, local and international
stages of economic and social development. to over 740 retail stores in 19 countries. consistently on their
Online shopping is another area of interest.
Internet retailing was worth nearly US$ 49
Second, brands that sell quality products
and demonstrate a good understanding of
THE FACESHOP’s philosophy lies in
understanding the importance of health
respective brand
billion across the 14 Asia-Pacific countries in local consumer attitudes and preferences and beauty. Continuous development is promises, and continue
2007, and is forecasted to double by 2012 to
approximately US$ 71 billion (Euromonitor
have a better chance of success. Third,
location continues to be a critical driver
an integral part of THE FACESHOP way of
life. The company’s research institute, a
to innovate and explore
International). According to a global Nielsen of success, but brands that can develop a center of collaboration with dermatologists, new directions.
06 Best Retail Brands 2009 Best Retail Brands 2009 07
Creating value in-store: Shoppers are what consumers become when
they enter the store environment. Shoppers
even Product Q, which is a little bit different
but appears to do almost the same thing.
or workplace, and cannot be gathered by
looking at market research studies that
• Promoting trial
how price promotions The retail brand comes to life through the
touchpoints of its physical delivery—the
This is in stark contrast to the foundational
aspects—those things that trigger brand
death and survival in a recession. When
making purchase decisions in downturns,
can be offset by an
selective mix, color, and packaging of in the consumer’s mind like the product customers become increasingly more
merchandise, the tone and manner of and its packaging, a logo, a jingle, or an demanding about their shopper experiences.
the employees, and the space that’s been architectural icon. Retailers do a great job They want to know more information about
Rune Gustafson
the brand into their consideration set at the sense of high quality; was the product located
Stop and think about it: Why do we have point they determine need. at eye level on the shelf? A great experience
the interpreted feelings we have about the consistently delivers the brand promise on
organizations we do business with and the What businesses fail to realize is that every point, while also innovating within this
Cutting price isn’t a long-term solution restaurants we frequent, the products we the experience is where the foundational promise. Ultimately, this is what will make
A bargain mentality can put a strain on the choose at the shelf, the banks we trust, (product/service) and transmissive any brand in a consumer-facing category
relationship with customers. When the or the manufacturers we hold in high (promises) elements come together. After stand out, especially when the competition is
emphasis of the dialogue is on price, the door esteem? It’s something beyond the simple all, if the experience does not deliver on the focused on offering less for less.
is open to fierce competition. At the same transaction. What are the influences that expectations of the received brand message,
time, the brand attributes that originally affect the way we choose brands? There are the brand will be relegated in the consumer’s
engaged the customer—the tangible and three: foundational, the product and its brand mind to the scrap heap of unfulfilled hype
intangible things that attract and satisfy, signature; transmissive or the promises made; and posturing. In the majority of businesses,
like store ambience, innovative products, and the experiential influence, the most critical experience is so disregarded that more
or impeccable service—lose momentum. of the three. In fact it’s easy to argue that often than not, the winner is the brand that
The shopper has fewer reasons to connect there is no brand without the experience. disappoints the least—not the one that does
Biography: Bruce Dybvad is the Biography: Rune Gustafson
with the brand. the most to define the experience.
President of Interbrand Design Forum leverages his extensive experience
and Interbrand Cincinnati. Bruce in brand management and retail
But if cost-cutting isn’t the answer, how
orchestrates all research, design, marketing as Chief Executive
do retailers survive? One way out of this
strategy, architectural, and of Interbrand London. He leads
downward spiral is to recognize that in
implementation efforts. His global a multifaceted team to create
uncertain times shoppers increasingly
vision, experience, and industry and manage brand value across
return to the retail brands to which they
knowledge have resulted in an all brand touchpoints. Rune is a
feel emotionally connected. Shoppers want
exceptional creative process that regular contributor to publications
stability, and strong brands provide the
ensures the fulfillment of client and conferences throughout
warmth and reassurance that they need. In
design and strategy. Europe, Asia, and the United States.
effect, this is only achieved when promises
are met on a regular basis. Promises are
delivered by the brand’s people, its product,
In uncertain economic times, and its place—the essentials that make
up the shopping experience.
the temptation for panicked
It is important to remember too that in tough
retailers is to rely on lowering times, customers will continue to welcome
new product ideas that are relevant to their
prices to drive store traffic. everyday needs. The paradox that good
L E
retail brands face is that although shoppers
But relying on continued
S A
are looking for support from their favorite,
trusted retailers, they still want new ideas,
price promotions isn’t new products, and new ways of surviving
the downturn. The strongest retailers are the
sustainable or differentiating ones that combine brand promise with brand
innovation, offering shoppers the most for
in the long-term unless their money.
Here are some ways for brands to 02 A great experience helps build 03 Store design plays a serious role in the
enhance the shopper experience brand equity. When mistakes are made, shopping experience, supporting both the
without increasing costs. accumulated goodwill encourages sales staff and the customer.
01 A great brand understands the customers to forgive. It goes without saying that the restaurant
needs of its core shoppers so that it Shoppers look to brands they can trust. and hospitality businesses have the means
can keep the experience relevant. In order to instill this trust, it is important to heighten their brand value through the
Before the economic bubble burst in Japan for employees to live the brand’s values experience. Last year, Holiday Inn studied
in the 1990’s, the retail focus was on luxury everyday—even when times are tough. the needs of its guests around the world and
brands. Companies that were resilient found six crucial experiential touchpoints
enough to survive the recession and even Banks are suffering from one thing right to improve. It is beginning to make those
thrive in the years following have been those now: a lack of consumer trust. Financial improvements throughout its global fleet,
that shifted the focus to quality. Brands institutions desperately need to build trust and it is already seeing the efforts pay off.
that rose in value during the period include into their brand, whether it is through
UNIQLO, Japan’s leading clothing chain that a sincere and positive message that A well-conceived environment is another
added private label cashmere at moderate emphasizes service, or a product that helps example to demonstrate how you understand
prices, and household and consumer goods consumers in a new and innovative way. consumer’s needs. A simple way to improve
giant MUJI that succeeded in offering its Financial institutions would be wise to this experience is flattering lighting, or
beautiful aesthetic at a price acceptable consider brands like JetBlue or Perrier, which fragrance in stores so shoppers feel pampered
to budget strained consumers. successfully restored trust in their brands by the surroundings. Kiddie spots, Internet
after comparable disasters. When JetBlue access, or relaxed no-sales zones can also
Currently, in the restaurant category, we see passengers were left stranded at various provide a friendlier atmosphere. Convenience
how less agile Starbucks, despite the many airports, the honest, sincere, and quick public can be stressed, as well as flexibility of use.
devotees to its fragrant US$ 4 coffee drinks, apology of its CEO stemmed the damage and Creativity through window displays, like that
is losing relevance and customers to booming started repair before its consumers could found in Urban Outfitters and Anthropologie
McDonald’s, which is flexible enough to begin to doubt the airline’s performance. stores is a major source of value since
add premium coffee to its low-priced menu. Likewise, when benzene was found in Perrier inspiring ideas will be seen as part of a store’s
McDonald’s has succeeded in stealing market water in the 1990’s, its people immediately customer service. A community of employees
share in a tough economy by adapting to notified the public and took every bottle off who share an understanding of brand-based
consumers’ needs and innovating within the market to ensure confidence that they values and behaviors are invaluable to a great
its promise. had the customer in mind. For both, quick brand experience as well. When they work in
action maintained value in the long-term. conjunction with the rest of the brand, they
While it is too soon to tell how the public give the retail experience the kind of vibrancy
apology from banking giant Barclay’s CEO that leads to loyal shoppers.
John Varley regarding the credit crunch has
fared, the move was an honest attempt to Improve and innovate
emphasize and restore trust. If Barclay’s Success relies on seeing the full potential of
also manages to deliver on the high brand influence. In the past, retailers focused
expectations of its apology and bid to help on merchandise and presentation, but today
with reconstruction to ensure the crisis they are looking at the entire experience and
doesn’t happen again, it is likely to be in how all the parts and pieces come together
better shape than most banks. to create a brand. In tough times, when the
shopper is more discriminating than ever, the
brands that offer more for more rather than
less for less are the ones that will come out of
the downturn with substantial brand value.
by Lynn Gonsior and for less. Insights like this are invaluable—
particularly when times are tough and
shoppers’ decisions are more complicated
Mobile,” a small specialty corner store focused
on selling mobile devices and service plans.
Best Buy has opened 41 Best Buy Mobile
The website will eventually offer extensive
information about products and brands,
with reviews from experts and shoppers and
they were innovative and adapted it to their
specific brand promises. As a result, their bids
to go green feel authentic and trustworthy.
FranÇoise Novel than ever before. stores in North America so far. It’s a powerful
leverage it can use against the competition.
a Q&A forum. The function will also include
a Sephora star rating system for the product 05 Developing the brand talent pool
Improvements to the in-store experience The stores sell 90 different phones and pages, allowing the brand to demonstrate
could be as simple as adjusting the lighting services from nine carriers. Employees value to its shoppers. Brands that are truly customer-centric are
If there is one secret of success for brands,
or optimizing the floor plan. Retailers are demonstrate their expertise and know-how still in the minority. And the few that are
it would be a speedy ability to adapt
not only being innovative about how they by helping shoppers set up email and other These brands have taken measures to create customer-centric are unique in considering
to rapidly changing markets and social
stay in tune with shopper’s demands and functions on new phones. trust and access using the web—in some employees. They realize the importance of
conditions. Even in tough times, brands
desires, but are also improving the floor plans cases taking cues from the shopper directly. brand culture and how employees play a daily
must respond to emerging trends with
based on the customer journey to boost the All of these brands have endeared themselves There’s much to learn from their innovations. role in bringing the brand to life for shoppers.
inspired products to fill stores quickly
impact of their brand, and improve point- to customers. They have showed that Classic examples are The Container Store that
and attract customers. They must also
of-sale profitability. Beyond the scope of the they care about the relationship and that 04 Becoming part of a larger trend invests in many hours of training in every
continue to grow by stealing market share
sale, the brand is brought to life through a they can keep up with consumers’ needs store associate, and Starbucks, which has
from competitors.
well-tailored store experience. In the last few on their terms. Top brands regularly look at larger social been known to shut down its coffee shops
years, Carrefour has updated its hypermarket trends, profiling shoppers’ needs and taking to retrain and reinspire its passionate baristas
In a time of reduced budgets and staff,
Biography : With a background in layout to improve the customer journey. It 03 Becoming the shopper’s the time to revitalize store models. They in order to improve the delivery of the
this may seem impossible. And yet, brands
retail design development for Kroger reduced the complexity and confusion that trusted resource experiment with trends so customers will brand experience.
continue to find ways to compete in a
and the Limited, Lynn Gonsior shoppers experienced within its stores, cut return to discover new shopping experiences.
new world order. Today’s leading brands
knows firsthand how to manage down on shopping time, and optimized in- Top brands have leveraged multiple channels Store employees need to be ingrained in
have become more sophisticated in their
valuable retail brands. Today, she is store communication. The new plan included to become a consumer’s trusted resource and A good example is the SFR music flagship the brand so they can deliver the brand’s
approach to finding growth, anticipating
the CMO/Executive Vice President global in-store communication, wayfinding friend 24-hours a day. Brands are integrating store, Le Studio. SFR noted a trend toward promise and represent the values of the
brand challenges before they even arise.
of Interbrand Design Forum and guidelines, and an improved layout concept. e-commerce micro sites used by a niche the convergence of music and technology organization beyond reciting a tagline.
continues to build one of the U.S.’s A deep focus on a shorter customer route market specific to the brand’s focus. They among a young and savvy audience. Its new Avon makes an effort to train all of its reps,
Here are a few of the best practices:
top retail consultancies. Lynn is a improved shoppers’ in-store experience. As are also providing informational editorial store is devoted to this shopper—offering so they understand and value the brand’s
member of the Display and Design a result, Carrefour saw improved sales and a content, news, events of interest, or just a live music performances, opportunities for products. German’s Mediamarkt is another
01 Applying behavioral insights to the
Ideas Editorial Advisory Board, more loyal customer base. way to buy when it’s midnight and a shopper shoppers to personalize mobile phones and example of a brand that has seen success by
shopper’s journey.
American Marketing Association, is worried about finding that perfect black demo new phone applications, a restaurant focusing on its employees. The brand lives
and National Retail Federation. Wal-Mart has also improved its store dress to advance her career or spark her and Internet lounge bar, and a place to by the strategy: “All business is local.” Store
New understandings of a shopper’s thought
environment, in-store messaging, and love life. download music. The innovative store quickly managers make decisions with flexibility
process and subsequent actions are
product mix. With wider aisles and brighter became a destination for shoppers. and independence, focusing on regional
providing brands with information to make
lights, customers are staying an average of Additionally, brands are exploring ways to assortment, pricing, and marketing. Not only
smart decisions around creating stores, or
14 minutes longer per trip. Additionally, create communities around their brands The sustainability trend is one that brands does the decentralized structure enable fast
departments within stores, that are more in
product decisions have been organized through the use of social networks, word in all categories have found to be especially adaptation to market changes, but the brand
tune with shoppers’ wants and needs.
around a new “win, play, show” strategy; of mouth, Web 2.0 tools, and influencers. successful. The concern about energy prices, benefits from the shared responsibility of a
win includes items like flat panel TVs, play These brands understand that the better global warming, and desire for clean air is whole group. Its employees feel like a part of
Specialized research methods clearly show
includes apparel, and show includes those they present themselves as in touch with looking to be a long-term social movement. the brand, and when employees feel this way,
how a brand fits into the consideration set as
that apply to Wal-Mart’s one-stop shop consumer’s lives, the better the chance Brands like Toyota, IKEA, GE, and Target have they become the differentiating feature of a
a shopper begins to make a decision about
status. This new approach improves shoppers will invite the brand into their incorporated sustainability into their brand product or service. As Mediamarkt and Avon
visiting the store. Retail ethnography allows
shoppers’ in-store navigating experience. homes, even when they are not buying. promise, and integrated it in a way that demonstrate, the companies that focus on
us to analyze a shopper’s journey, from the
corresponds with their overall business goals. their brand’s attitude and vision throughout
Biography: Françoise Novel decision to enter the store and even down to
02 Putting the store in the The Body Shop has taken a number the value chain (from the purchasing team to
leads Interbrand’s European retail way a shopper looks for information at the
customer’s path of steps to modernize its brand online. IKEA has decided to put an end to plastic the financial team) will often see the results
practice, a highly creative and shelf. Armed with this insight, designers and
To encourage shoppers to “think ethical” bag consumption, which is an easy and cost reflected in its company’s earnings.
strategic team whose work helps planners can strategically position products
Retailers have been ingeniously exploring when they purchase, it has launched a new effective way to go green. Proving that the
clients to link their consumers’ to promote cross selling and drive larger
non-traditional locations, smaller footprints, initiative on Facebook, requesting that move isn’t just another cost-cutting measure, Conclusion
needs, the brand proposition, and baskets (i.e. purchases). And as a result,
new formats, and modified assortments to members sign a “Together & Fair Pledge.” it is also investing in small and medium-sized
a company’s sales-investment stores have higher performing store plans.
interrupt the customer journey in new places. By signing up to the pledge, supporters enterprises, which can provide solar panels Although budgets may be tight and stealing
capabilities in order to grow the
make a commitment to tell at least one and new solutions to reduce water and market share may seem impossible, there
retail brand as a business asset. Zara has been especially innovative about
The Home Depot altered its format, offerings, person a week about a new ethical product energy consumption. Afterwards, IKEA will is still potential for growth. Brands need to
Françoise is both a trained architect staying in tune with shoppers’ demands and
and services to adapt to the urban needs of or service they have discovered. sell these products on its shelves. Toyota has adopt some of the practices outlined here,
and a graduate of the EM Lyon desires. At headquarters in La Coruna, Spain,
cities like Manhattan and Chicago. Retailers launched a zero emissions blog and a new and adapt them to their specific needs. In
Business School of Economics. Zara has managers stationed at computers to
from Louis Vuitton to Target have created Similarly, Boots has revamped its online hybrid pre-owned certification program to tough markets shoppers’ are evolving faster
monitor sales around the world in real time.
pop-up stores. Target ‘s pop-up stores appear presence at boots.com. One of its most leverage its hybrid car offer. than ever. The brands that evolve with them
in the Bodega format in Manhattan to entice important new elements is the Boots Live will be the ones that will come out on top.
urban dwellers inside to shop. Pharmacy service—an online health question
and answer service.
in a downturn
repair. Our client didn’t want to wait.
a variety of companies who have refreshed
by Josh Feldmeth
recalibrate its brand portfolio for greater
Brands who leveraged more value
value. We investigated drivers of demand
from current assets
The right move depends on many factors: and existing brand equities in mature
industry, strategy, customer targets, and and growth markets across each of the
A global, diversified bank rebalanced its brand
internal organization and culture. Here are client’s sub-branded businesses around
Although the first solution of ignoring the portfolio toward a more efficient centralized
some of the typical questions we are hearing the globe.
brand may seem the simplest, the brands model based on the insight that drivers of
Navigating that choose the second can seize unique
right now from clients under pressure:
choice were consolidating globally. (Read more
Our research results ran counter to
turbulent seas opportunities in challenging markets.
These are the organizations that build
• I need new sources of revenue,
about this bank in the sidebar, Case study #1.)
convention. Customer needs - from
fast—how do I find it? retail customers Europe to new, money,
unbeatable brands—and these are the After watching competitors experiment with
and high net, worth individuals in
brands that may even come out winning a new restaurant concepts, like McDonald’s
• My 2009 budget is in jeopardy, and I Asia to investment bank customers in
new and bigger piece of the pie by adapting R-Gym, an international quick-service
Rising energy demand, food shortages, need to prove ROI—how do I do this? the US—unexpectedly demonstrated
to the changing environment. restaurant chain recently questioned if they
soaring raw materials costs, frozen financial How do I do more with less this year? considerable overlap. These very
were over-investing in expensive facility
markets, declining productivity, and waning different customers had very similar
programs, and under-investing in marketing
consumer confidence—these seismic shifts • How can I squeeze more value from my needs, and for a global bank, with far-
Biography: Josh Feldmeth has are reshaping the financial sector and Effectiveness + brand portfolio, my retail network, or my
and food promotions that can get to market
more quickly.
flung marketing, communication, and
worked with leading retail brands
all over the world. In his role as
challenging players up and down the value
chain to produce results. Few will remain
efficiency = global chain of restaurants? sponsorship activities, it presented an
invaluable opportunity to leverage brand
European Practice Leader for untouched. Even industries like healthcare, more from less • How do I offset declining growth in my
A big box US retailer reinvented its store into
a more experiential destination, with broader
investments for greater return.
Interbrand’s Analytics team, Josh where demand is less sensitive to market category? How do I hit growth targets
services and in-store resources, in order to
helps to ensure that everything we fluctuations or ultra-luxury brands, whose when customers are cutting back? Using the data, we constructed a
gain visits from cost-conscious shoppers
do for clients, from strategy through customers tend to be insulated from structural equation model to identify
looking for new (and cheaper) sources of
creative, creates business value. economic downturns, will surely have to Well-positioned brands create value by • How can I continue to justify my brand interaction effects: how the
entertainment.
He helps colleagues and clients make some tough decisions in the coming driving demand. Smart brand owners price premium? What do I do given perceptions of one or more of the
understand the mechanics of how weeks, months, and years. manage this value by building strong brands that my brand is at the premium end client’s brands created (and prevented)
Brands who found new sources of growth
brands create value and where that secure future revenue over time. The of the category? demand for other brands in the portfolio.
capital should be deployed Management has snapped into action, current environment is demanding even This intelligence revealed a new set
A major FMCG player mined its current
to maximize that value. deploying the classic recessionary tools— greater returns, forcing brand owners to • We’re launching a major initiative, of portfolio management principles.
consumer segmentation data for insights on
consolidation, cuts in their workforce, quickly locate incremental value from the and in this market, there is no room for If followed, these principles would
how target customers attach to the brand,
spending caps, and budget reductions. And brands they manage. Unfortunately, even error—how do I ensure that nothing grow demand across the business.
preventing private label and share erosion.
yet, the question remains: How should organizations with strong brands can goes wrong?
brands be managed in a crisis? What kinds struggle to capture incremental value for The so-called holy grail of branding—
A global heavy equipment manufacturer
of recessionary tools should marketers two big reasons. While the burning business questions may greater effectiveness and efficiency
identified brand partnerships that leveraged
be using? differ from client to client, all require a equals more for less—was delivered
common brand equities, resulting in several
1. They lack a detailed understanding greater understanding of the mechanics in a spreadsheet, just in time for the
million Euros of incremental brand revenue.
Interestingly, the tools that may work in other of brand mechanics—how their brands of brand value creation (effectiveness). global financial meltdown.
parts of the business don’t necessarily apply influence behavior and customer choice. This understanding will help brands create
A UK-based retailer and global FMCG
to branding. While you can downsize, right Greater insight into the mechanics of brand more value and improve decision-making
player joined forces to re-orchestrate retail
size, in-source, and outsource, you can’t fire value creation is essential for improving (efficiency), so brands can spend more wisely.
shelving principles based on shopper needs,
the brand. It won’t go away. Brand owners effectiveness during periods of market
stimulating organic growth in the category.
only have two options to navigate turbulent instability. The tools of brand analytics—tailored
(Read more about this UK-based retailer in the
seas. They can either ignore the brand (i.e. research, intelligence systems, risk and
sidebar, Case study #2.)
stop spending) or manage brand assets for 2. They are not equipped with the advanced probability models, capital optimization—are
greater value. management tools required to make essential for winning in crisis markets. A crisis
complicated and pressurized capital not only disrupts financial and consumer
allocation decisions. Improved decision- markets, it also radically changes everything
making can optimize brand efficiency by that you once may have held to be true about
pack: how transforming design are the same. How is the consumer
supposed to shop the category if everything
is the same—same color palette, same
architecture, same silly cartoon character,
competitive landscape. Moreover, clients
have to trust the designers’ abilities to create
white space within that arena—a process that
can make both parties uncomfortable.
category language
This begs the obvious question: Where are
same product delivery, same milk splash/
the design consultants in all of this mess?
pour, and same spoon? The formula does not Unfortunately, failure to understand, listen,
Are they so absorbed in producing hip and
even change from country to country—it is and engage in constructive dialogue during
current designs that they too get lost in the
strictly followed ad nauseam. How is this the time of creation often leads to category
from substitutes
levels of creative brand excellence. They
the category language and opportunity, but
must respect the rules of the category
not the ultimate prize. In the end, this has
while leveraging the opportunity to create
left these brands particularly vulnerable to
white space and ownable, defendable brand
private label brands, which easily adopt a
same category use the same while Minidou/Silan (Henkel) enriched its
packaging with a photograph of a mother
design cues on packaging? If you kissing her baby. Moreover, Comfort
(Unilever) in the UK uses an equal design of
Biography: Dyfed “Fred” Richards Biography: Bertrand Chovet seeks did, it was no fluke occurrence. a mother with her baby, all encapsulated by
Cute
character
is Interbrand’s Executive Creative to build brand distinctiveness and
Director in Cincinnati. He has consumer loyalty in every single Within certain categories, there a heart, which the Soupline brand Colgate-
Palmolive, Europe) has also recently added.
traveled the world, creating and
experiencing brands in diverse
client engagement. As Managing
Director of Interbrand Paris, his
is a disturbing trend to follow
Milk pour or splash
cultures and categories. Constantly commitment to high performance what can only described as or spoon of product
inventing new techniques for has resulted in many award-winning
unlocking creativity, Fred has retail and package design programs. formula design principles.
developed some of Interbrand’s For 15 years, Bertrand has worked
breakthrough design methods, and with Interbrand clients on extensive
Product
his expertise in the FMCG category business issues across a wide range of
in a bowl
has helped to build some of the sectors, from FMCG to luxury brands.
world’s leading brands. Fred is a
prolific author and commentator on
brands, and captures his insights in
a weekly design review. Formulaic design principles
Carrefour achieved astounding growth Over the past 10 years, we have seen an Changes in consumer expectations also In order for a brand to minimize the private
through its private label brands. improvement in private label brands due support the growth of private label brands. label takeover threat, it has to be itself—it
to the lower cost of printing. Indeed, a Consumers now expect to get more and has to play up its unique strengths within any
In 2005, Carrefour—the world’s second Nielsen report from late November 2008 pay less on a continuous basis. New to the given category. Following another brand’s
largest retailer of groceries and consumers states that sales of private-label brands in purchase decision is the consumer’s hurdle language does not add value to a brand or the
goods—launched a third generation of the U.S. grew to US$ 81 billion in 2008, a 10.2 for substitution. The perceived cost of the consumer’s experience. Designers need to
products that would mix the lowest prices percent year-on-year growth versus 2007. additional time and effort that is required to clearly map out what the category is saying at
in each market with a socially responsible That’s because private labels have, locate and acquire an unavailable product shelf level. How does the consumer approach
proposition. and continue to, consolidate strong store from an alternate store or channel is great. the category? How do consumers choose
brands that can extend well into different Indeed, consumers’ need for immediate from one brand to the next? Do they actively
Based on shopper insights and category categories, and succeed in driving sales. purchase satisfaction often outweighs any engage with the package? Do they compare
research, Carrefour organized its offer into (See more in the Carrefour sidebar.) perceived sacrifice in quality and brand one label to another or do they judge from
three categories: Carrefour for Everyday, preference. Shoppers are striving to save the a distance and then select? In addition to
Carrefour Agir (organic and ethical products), Private label brands appear more frequently “negative time/labor time” in supermarkets or thinking carefully about all of these factors,
and Carrefour Selection (premium products). throughout a store, which multiply department stores in order to increase their designers need to communicate their
Each category had a distinctive look that also touchpoints and create more occasions “positive time/enjoyment/family time.” thoughts clearly and concisely to capture
corresponded with the larger master brand. for purchase. Frequent appearance also shoppers, who might be eager to adopt a
creates more familiarity with the label, which Recent research only confirms this. An IGD- new trend. Creative differentiation can be
Carrefour for Everyday included over 8,000 increases reputation, despite advertising that Consumer Research 2006 study shows that leveraged through various drivers: from a
products and was given key shelf space, often is lower in comparison to manufacturers’ when a product is unavailable, 40 percent more effectively targeted message, a better
on eye level. Carrefour Agir’s simple look and brands. Additionally, with private label of consumers buy it at another store, 17 conveyed value message (premium vs. private
packaging evoked the sub-brand’s organic brands, shoppers can begin to look at a store percent delay purchase, 22 percent substitute label),to a stronger depiction of a brands’
and eco-conscious contents. A mix of classical as a destination to find their trusted brand a different brand, seven percent substitute social and lifestyle values, to an innovative
and unexpected graphics was used to convey or brands. Formulaic design only helps these the same brand and eight percent do not message that answers new consumer
Carrefour Selection’s premium, upscale range private label brands more by making it easy purchase the item. expectations.
of products. and affordable to create a competitive look
for their products. A key objective in manufacturers’ and Think about it this way: What makes a sports
The launch of these private label brands was retailers’ promotions is to increase sales by star stand out from the rest of the team?
a huge success. Nine out of ten shoppers are motivating brand substitution. Promotion Most likely, he or she understands the rules
buying Carrefour products, which represents enables both retailer and manufacturer to of the game. However, at the same time, he
more than 25 percent of the turnover. meet objectives when brand substitution or she distorts and surprises viewers with
occurs. Brand substitution is investigated a new and inventive playing style. A brand
by developing sales response models functions in the same way. It becomes
relating each brand’s sales to its own and ingrained in our psyche by both playing and
its competitors’ variables. Store price, subverting game rules.
featuring, and display all come in to play
with substitution. To illustrate, when a store On a long-term basis, brands need to build
offers Brand C at a promoted price, Brand relevant difference and consumer preference
A and Brand B will lose sales. The average in order to combat an increase in competition
explained variance across brand-level models and a decrease in sales. Meaningful differ-
is 42 percent: 26 percent price promotion, entiation and consumer loyalty will make
12 percent featuring, and 4 percent display. consumers look to your brand and create
more value.
With private labels, not only is the price is
generally lower, but the brands are displayed
more frequently in the store. So, in categories
where all the brands look the same, they have
a clear advantage in capturing the 19 percent
by Richard Veit
and aspirations in Western and European
presence in the region by adopting a brand- international companies that have succeeded
societies. Despite substantial differences
oriented strategy. Their successful expansion in this region have taken this one step
in household net-incomes, the desired
has put pressure on regional brands. further. They’ve redefined these local brands’
lifestyles in these regions are quite similar.
personalities to create powerful pillars of
Successful international brands have tapped
identification beyond their local market. The
into consumers’ desire for identification and
01 Acquiring and the need to communicate their belonging to
combination of international and revamped
national or regional brands is proving to be
developing strong a new wealth and lifestyle community. The
simple brand promise—to deliver a different
an especially superior recipe for brands with
Greg Silverman
helping shoppers to indulge in thrift. with its restaurant and Internet lounge bar.
The space offers free WiFi, so shoppers can
Thrift is a word rarely heard these days, listen through “sonic showers” and download
but its original form is “thrive.” Thrift is a up to one million singles.
means of thriving by wisely making purchase
decisions, rather than blindly spending. This
is something we routinely recommend that
our clients keep in mind when catering to
shoppers. Retailers should help their shoppers
search for smarter ways to live well.
retail brands
is a proven, straightforward, and profound specifically attributable to the brand. The (loyalty, re-purchase, and retention) and
formula that examines brands through cost of doing business (operating costs, thus sustain future earnings, translating
the lens of financial strength, importance taxes) and intangibles such as patents and branded earnings into net present value.
of driving consumer selection, and the management strength are subtracted to This assessment is a structured way of
likelihood of ongoing branded revenue. assess what portion of those earnings are determining the specific risk to the strength
Our method evaluates brands much due to brand. of the brand. We compare the brand against
like any other asset: on the basis of how common factors of brand strength, such as
much they are likely to earn in the future. All financial analysis is based on publicly market position, customer franchise, image,
There are three core components to our available company information. Interbrand and support.
proprietary methodology. selects from a range of analysts’ reports
to build a consensus estimate for financial
reporting.
market, we have environment, and price. Examples would be at brands as retailers, first and foremost.
of 20 years. In-house market research is used
to establish individual brand scores against
identified three Zara, Abercrombie & Fitch, Marks & Spencer,
Mango, and Aldi. These are the brands that become valuable
our industry benchmarks.
Location
FINANCIAL ANALYSIS BRAND VALUE CALCULATIONS
Forecasted current and future
Price revenue specifically attributable
to the brand.
Availability
BRAND STRENGTH
Image Brand strength Analysis BRAND
ANALYSIS
= Discount rate VALUE
Branded Unbranded A benchmark of the brand’s
ability to secure ongoing
customer demand (loyalty,
repurchase, retention).
3
Best Buy
20,809
27
28
Abercrombie & Fitch
Old Navy
2,551
1,592
Understanding brand dynamics through its Interbrand has been studying the world’s 7 Walgreens 11,145 32 Netflix 1,268
concerted analytics tools gives a company most valuable brands since 1984. Today brand
the ability to measure the economic power decisions can be measured and thus held 8 Lowe’s 10,710 33 Radio Shack 1,254
of its brand and identify which business accountable for the investments that make
elements create that power. The role brand a brand stronger. A strong brand ensures
plays in any business decision versus the relationships that create future earnings by 9 Sam’s Club 9,478 34 Urban Outfitters 1,134
other components of that choice can be growing customer preference and loyalty.
gauged and connected to strategy. Legacy 10 Coach 9,052 35 Bath & Body Works 1,124
biases can be overcome so that managers can Which brings us to the list—our first annual
make smart decisions that take brand, space, report card of the most valuable retail brands
11 e-Bay 7,991 36 T.J.Maxx 1,112
and finance into account simultaneously. in the United States, plus the top five in
Light can be shed on previously unrecognized Canada and Mexico. It’s an assessment of
market opportunities and new investments the companies that are most successful 12 Staples 7,224 37 Marshalls 1,103
justified. Brand helps a retailer create at managing their brand. We’re delighted
demand, not cater to demand. to share the lessons from the leaders, and 13 Nordstrom 6,753 38 Dick’s Sporting Goods 1,073
give some insight into how they tackle the
challenges of today’s market. We also hope it
14 Amazon 6,434 39 J.Crew 959
provides a push to those who still cling to the
outmoded operations-driven way of viewing
their business. 15 Costco 5,718 40 Hollister 907
34 Best Retail Brands 2009 Best Retail Brands 2009 35 Best Retail Brands 2009 36
1 129,809 $m
BEST BUY. Consumer electronics is the CDs, TVs, PCs, and video games cover emphasis on employee expertise and
TARGET. Mass retailer Target is
demonstrating its commitment to being
Store formats are flexible, including multi-
level stores in urban locations. In 2009, it will
Target’s iconic
largest and fastest growing retail sector a wide range of price points from the commitment. Rollout is complete for
in the U.S. The current market size is US$ expanding top-line Magnolia products the high-performing Best Buy Mobile
the industry leader by investing in expansion,
technology, sourcing, and design. Target’s
unveil a new prototype with expanded food
sections, as well as new architectural and
bullseye is
100 billion; the top 10 retailers by volume to more affordable brands. store-within-a-store, and its conversion to
account for 70 percent of the market. thirty 3,000-square-foot mall stores has
iconic bullseye is recognized by 96 percent of
Americans and it claims a disproportionate
visual elements. Currently, Target is focusing
on domestic growth and performance,
recognized
Best Buy is the clear leader, stealing The company strives to differentiate its begun. It began a 12-airport test of robotic
points from competitors. Its service brand experience through distinctive touch vending machines branded “Best Buy
share of affluent shoppers under 45. The
brand spends roughly US$ 1 billion a year
expanding into Alaska and Hawaii.
by 96 percent
offerings from the Geek Squad to the points, like the Geek Squad VW Bugs. Express” carrying cell phones, computer
new mobile in-store concept continue Store environments and selling styles are accessories and cameras this year.
on advertising, well above their biggest
competitor, Wal-Mart, and continues to
of Americans.
to find favor. A large selection of DVDs, tailored to customer insights, with current 4%
steal share from the apparel industry by
offering high-design “cheap chic” merchandise
branded by major fashion designers. Target
ranks 14th on BusinessWeek’s list of 119 Best
Places to Launch a Career, has a very loyal and 96%
satisfied shopper base, and scores high on
the American Customer Satisfaction Index.
The company is sensitive to the fact that
shoppers are choosing their mass merchant
based on its environmental footprint, and
four of its Chicago stores have green roofs.
CVS/PHARMACY. The drugstore industry DELL. Despite the design influence of Apple WALGREENS. Walgreens is everywhere;
is dominated by CVS, Walgreens, and and HP’s big advertising budget, it’s direct 139.1 million people live within two miles
Rite Aid, which are forced to compete on seller Dell that makes the list. It’s a clear leader of one of its stores. Although its growth has
both pharmacy and convenience with in computer products with roughly 30 percent slowed, it continues to adapt to new market
supermarkets, mass, and warehouse clubs. of the market. Dell gets props for doing brand conditions, and will likely remain a top three
CVS has adapted well to market conditions right. However, it makes a fairly standard pharmacy player for years to come. Same-
and the need to stay relevant against online product, innovating only to the extent of store sales have been hit by generic drug
pharmacies. The druggist fills or manages faster processors and new technology. The offerings from non-drug stores as well as the
about one billion prescriptions per year and company concluded its attempts at retail growing popularity of mail order and online
leads in revenue over Walgreens, which has in the form of inventory-less mall kiosks, pharmacies. Walgreens’ confidence may
a slightly greater number of stores. With the deciding instead to allow outside retailers have slipped when it lost its bid for Long’s
customers’ needs, THE HOME DEPOT. The home improvement seeking a better understanding of customers’
the first 26 weeks of 2008, attributed to the
increased average front-store ticket size. More
competing on price, the retail presence has
given Dell increased shipments and share.
police to protect and evaluate the quality
and standard of their product offerings so
market is highly fragmented; Home Depot needs, especially women, in order to align
especially women, has the largest piece of the pie with 7.7 with them. It has succeeded in reinstituting
than 65 percent of front-end sales use the its brand equities won’t become diluted as it
store’s loyalty card. As a result, CVS continues tests new offerings. While the company still
in order to align percent of the industry’s market share. The
brand benefits from very high awareness,
the regional-focused product mix it was once
known for and has put more resources behind
to grow and take a greater share of wallet. lags when it comes to shopping experience,
CareMark and MinuteClinic, separate divisions Walgreens does excel at offering a variety
with them. huge revenue streams, (historically) its private labels. Marketing strategy includes
of CVS, add pharmacy benefit management of formats to meet the needs of each
impressive sales, and very deep pockets,
so it can afford to strengthen brand
re-emphasis on in-store clinics and refreshed
consumer relevance, moving from home
and clinic services to the format. Exclusive Walgreens does community, such as smaller footprints in
through product mix and pricing strategies. identified its weakest metrics and is working
end sales, a reflection of both the downturn
and the company’s brand strategy. There is
to meet the needs Like its competitors, it lacks the ability to truly
differentiate the experience since innovations
Consumers have criticized the store’s
shopping experience and in response HD is
to generate preference and loyalty.
some disconnect between the marketing of each community. in this category quickly become table -stakes.
messages in the store versus those online. To
differentiate the shopping experience, a new
layout has been designed to make stores more
consumer friendly.
LOWE’S. Lowe’s created the service centered, SAM’S CLUB. Warehouse clubs as a group its marketing strategy is not seeing positive E-BAY. Even though e-Bay is one of the NORDSTROM. The fifth largest U.S. store. Nordstrom has always been on the
value-add standard that set the pace in the have great potential to grow offerings, returns. In-store signage has improved, but largest advertising spenders on the BRB list, department store with net sales of US$ 8.8 forefront of buying quality, relevant products
home improvement sector. Lowe’s is the expand locations, capture market share little is being done to get consumers in the it has been losing share in the online retail billion and a five year annual growth rate of and merchandising them in the store to best
second home improvement market leader and improve consumer loyalty. While Sam’s door. Sam’s has tried to reproduce some of market for the past couple of years. Growth 8.12 percent, Nordstrom consistently hits all effect. Private label apparel accounts for 13
after The Home Depot with four percent of Club is second in market share to Costco, Costco’s value as a “treasure-hunt” but loses through acquisition succeeded in the case the big “best” lists. It is one of Fortune’s “100 percent of sales. Amenities include a spa,
the market, winning on customer satisfaction its brand value is higher because of its niche on relevance since consumers do not expect of Paypal and Bill Me Later, but Skype has Best Companies to Work For,” and “Top 20” restaurant(s), in-store boutiques, and an
and loyalty, and competing for market share within the small business market. However, it. Although Sam’s has altered its format, not proven to be a winner yet. The online most admired companies overall. Its store on-site tailor. A top priority for the company
based on this metric. While same store sales Sam’s has had a hard time driving sales and revamped its planogram, and refreshed its auction business is slowing and e-Bay needs experience and customer service make it a remains devoting a significant portion
have declined dramatically for both leaders stability. Product quality is viewed in terms logo, it needs to do a better job focusing on its to make a more concerted effort to fend destination for shoppers time and time again. of capital to store remodels to keep the
due to the housing debacle, Lowe’s has a of simple low-price deals. Warehouse clubs’ target segment and the creation of a better off encroaching Amazon with something Due to economic conditions, shoppers are experience current for all customers. Online,
promising proposition: concentrated efforts insulation from the recession is beginning shopping experience. If mass market and more in keeping with its brand roots rather buying less, but still visiting their favorite Nordstrom features lifestyle merchandising
on customer service and in-store experience to thin; vendor pricing is increasing which discount retailers choose to compete in bulk than its move into fixed price selling. The with Head to Toe looks (9 to 5, Night Out,
which could continue to steal share. Lowe’s hurts margins, the main draw for members and price, warehouse clubs could suffer. company has no customer loyalty system in Weekday Casual, and Ten Things to Evolve
has the ability to shift product placement to renew. Membership fees account for the place but continues to maintain the quality The online auction Your Style Right Now). Juniors direct
and mix from specialty items to conservative
everyday items mirroring consumers need to
majority of Sam’s income. The company has
made some effort to increase membership
of its sellers through customer reviews. The
company’s touchpoints are also inconsistent
business is slowing marketing includes a MySpace page/video
channel, mobile phone and email alerts,
manage—not dramatically overhaul—their ties and loyalty (for example, by allowing among the different groups which operate and e-Bay needs back-to-school fashion shows, and
homes. Its message of value, convenience,
and customer service/in-store experience is
college memberships), but on the whole
hasn’t innovated much. It has employed
under its name. Despite a remarkably high
level of awareness for the brand, it looks as
to make a more partnerships with Teen Vogue. The retailer
will soon have 109 full-line stores. Its
integrated across all touchpoints. Further, few new merchandise mix strategies even though e-Bay’s long-term survival and ability concerted effort to longer-term plan is to have 140 to 150
the brand has been smart with its advertising
during the downturn, cutting back on
though there’s a high and growing demand
across retail for private labels which make
to maintain its place in the market hinges
on its ownership of several payment services
fend off encroaching stores by 2015. Its skill at balancing the
department store format with luxury will
promotional spending with low return and up 10 percent of its product mix. Moreover, that are becoming increasingly important in Amazon. keep it going strong.
instead looking into new store formats. the marketplace.
Lowe’s is unafraid to conform to a new market
or take a smaller footprint. Although it is still
ahead of the competition in maintaining
and growing value-add in the store, it isn’t
differentiating on products, inspiration, or
10 9,052 $m
12 7,224 $m 14 6,434 $m 15 5,718 $m
price to protect its position. Its service is
consistent, but not revolutionary.
STAPLES. Staples is a clear leader in office AMAZON. Amazon owes its retail leadership COSTCO. Costco is the warehouse club
COACH. Although luxury retailers can be they appear in the store. Although the supplies and services, but is unfortunately to pioneering technology, borrowing and market leader by revenue. Costco focuses on
Lowe’s has a promising confident of their place with the upper customer’s perception of Coach as a the main runner in a dying sector. Margins are improving aspects of eBay’s review model, a high-income consumer, but the company
class, the lower and upper end of the luxury brand has not changed, the brand typically low on office supplies. It’s very easy and growing its relevance among consumers is primarily focused on being a low price
proposition: concentrated middle class is where they are currently has had to follow other top retailers by to enter the saturated market and almost any through an ever-expanding selection. provider and on the success of its popular
efforts on customer losing customers. The recession is lowering its prices. Despite its exclusive retailer can add office supplies to its format. Additionally, it has its own branded product, Kirkland private label. The retailer enjoys high
making it clear that even the strongest lines, brand differentiation may be on The company seems to have done everything the Amazon Kindle. It’s also a fairly big consumer satisfaction scores in a Colloquy
service and in-store luxury brands can feel the pinch. the wane. right. The brand has taken on new formats advertising spender and reaps the benefit survey (based on a mix of quality, low price,
experience which could Although Coach was ranked number one (stand alone copy stores, improved website), of co-op advertising. Its shipping programs and experience). However, vendor prices
on BusinessWeek’s 50 Top Performers, new services (easy tech, installation services), are highly successful, often resulting in are increasing, which hurts margins (and
continue to steal share. the company’s recent decision to new partnerships (Dell provider, recycling customers spending more on merchandise prices are the main draw for members to
stop reporting outlet and retail sales Although the efforts, and green initiatives earned it fourth than they would have otherwise because renew). This subsequently hurts the club’s
separately makes analysts suspect it of
trying to hide weaker numbers. Coach
customer’s place on Dow’s Sustainability Index). It
also began the trend of higher-end, private
of the perceived savings. Being exclusively
online gives the brand control over its
stability, as membership prices account for
the majority (approximately 75 percent) of
customers loyal to the brand do not perception of Coach label office supplies, something to delight experience from start to finish; it’s consistent revenue. However, Costco has tried its best to
currently want to pay full price and
catering to its more cost-conscious
as a luxury brand the consumer. In advertising, Staples has
integrated its messaging across TV, online,
throughout all its touchpoints. The website
is the same format regardless of country.
protect that membership structure and keep
prices low. The brand has done a solid job of
consumers with less expensive items may has not changed, and in-store. It has remained brand-true It is difficult for an online retailer to own a evaluating trends across its store experience,
detract from its allure. Its advertising
conveys the same image experienced in
the brand has had throughout by staying consistent to the
brand’s core values. However, the brand
protectable experience. Customers are
drawn to the Internet for its convenience,
product mix, and supply chain. Current
marketing support is based solely on new
its stores and on its website, making for to follow other has also reformatted to meet a changing and Amazon is just as convenient as the store openings and direct-mailings to target
nice touchpoint integration. Coach is
also experimenting with buzz marketing
top retailers by consumer’s price-centered needs. Staples
gets a big bump for its private label efforts
next site. However, the company is strong
on customization, and strives to make online
area consumers. Costco has 518 stores in 39
states (compared to 594 of Sam’s in 48 states)
by previewing new items online before lowering its prices. which account for 22 percent of total sales shopping as simple as possible. While some and invests in more premium real estate
with a goal to hit 30 percent by 2009. Its in- consumers still aren’t that comfortable than its peer. It hasn’t changed store format,
store and online experiences are relevant and buying products online, Internet usage is but has expanded offerings into banking,
differentiating, but not particularly widely rampant and becoming even more so. pharmacy, and gas. It also has refreshed its
resistant to imitation. online services.
VICTORIA’S SECRET. North America’s GAMESTOP. The only retailer whose GameInformer, connects the brand to POLO RALPH LAUREN. The brand’s SHERWIN-WILLIAMS. With 3,325 stores in AUTOZONE. The sale of automotive parts,
top specialty retailer of women’s intimate entire focus is gaming, GameStop is its customers. The store also hosts remarkable brand discipline and its lifestyle the U.S. and Canada, Sherwin-Williams has accessories, and maintenance is highly
apparel is the most influential brand in the small but mighty. Its knowledge and special opening nights for popular appeal continue to allow it to develop across exceptional success in its retail operation. competitive with challengers in just about
category, continually launching new relevant service offerings are value adds their game releases and takes advantage an expanding number of products, price tiers, It has bridged manufacturing with retail every retail category. AutoZone is the
products and brand extensions, such as competitors can’t match. It faces its of cooperative advertising. GameStop and markets without dilution. Polo Ralph sales to deliver highly relevant, quality goods leader with over 4,000 stores, more than
Pink and VSX. Victoria’s Secret has become strongest competition from mass and recently acquired Electronics Boutique Lauren sells directly through 313 dedicated to their consumers, direct from its R&D US$ 5 billion in sales, and ranks 394 on the
the back bone of Limited Brands’ company big box and the ever-present threat that which aids its aggressive goal of opening stores as well as on the parent company through its plants. The market is still sluggish Fortune 1000 list. It wins on the basis of
profits, operating in about 1,300 mostly game manufacturers will begin offering 550 to 600 new stores in the near future. website, RalphLauren.com. Centralized because of the housing market slowdown, customer service, merchandise selection,
mall-based stores, with thriving online and downloadable games. Video games are The company is currently testing a larger worldwide marketing ensures that customer but the brand is on top of the paints and and availability, price, product warranty,
catalog channels. A recent revitalization of a US $20 billion a year industry whose prototype with more demo kiosks and touchpoints are fully integrated with themes varnish industry. Sherwin-Williams has store layouts, and location. Customer
the shopping experience includes an increase growth depends on manufacturers’ touch screens that allow customers to and images of the brand. It also preserves increased its stock dividends for 29 years surveys show increased satisfaction scores
in-store size and improved merchandising. new product rollouts. GameStop is the browse the 5,000 SKUs carried by most Polo’s distinctive image with its department and is hitting record revenue numbers for its in recent years. AutoZoners (employees)
However, its aging core customers feel the leader in video game sales with 4,264 stores. The brand’s hardcore gaming fans store and licensing partners. Shop- 141-year legacy. The brand’s deep offerings in strive to put customers first to encourage
brand may be abandoning them for younger, stores in the U.S. It continues to grow have declared it “awesome.” within-shops enhance brand recognition, automotive paints has helped those numbers. loyal relationships; a proprietary database
less sophisticated shoppers. And although revenue despite the global slowdown. differentiation, and merchandising of the line. It continues to be highly relevant to its looks up everything needed for a job, and a
the Victoria’s Secret runway show with Whereas mass and big box can compete While the brand’s agreement to outfit the consumers although there is nothing of free Loan- A-Tool program saves consumers
its supermodels in thongs and wings has on price, GameStop has the advantage 2008 U.S. Olympic team struck some as more note in its shopping experience save the money. Advertising reminds consumers of
generated massive amounts of awareness, of an in-store experience, featuring a elitist than athletic, Polo Ralph Lauren’s role exceptional product mix. The brand has an the importance of vehicle maintenance.
the brand appeared to be catering to male loyalty card program and a very dedicated as the official 2008 outfitter of Wimbledon, ever-expanding portfolio of private label AutoZone intentionally keeps a similar
tastes; similar images in the store itself tend knowledgeable staff. The retailer also the world’s oldest and most prestigious tennis brands, many trend-forward, that are major format across stores with 80-95 percent
to make women less comfortable. There has buys and sells used games, a major tournament,suits it well. players in the industry. Store formats are selling space, 21,000 SKUs in inventory,
also been a perceived drop in quality. The differentiation point. Its magazine, simple and service oriented. Advertising and overnight access to 750,000 SKUs. The
company has acknowledged these challenges spend is relatively low; Sherwin-Williams retailer continues to improve assortment
and is working to correct them. has a presence on channels such as HGTV, relevance and carries private labels Duralast
22
DIY, TLC, and the Food Network, but it’s and Valucraft.
3,282 $m the brand’s expansion, acquisitions, and
market growth that help it gain stability and
17 19 20
recognition, beyond the depth of its offerings.
5,264 $m 4,357 $m 4,208 $m
KOHL’S. Kohl’s focus on store productivity
balanced with staying on-trend through
26 2,568 $m
relevant exclusive labels to meet targeted
AVON. The beauty market is growing even
in a slow economy, but there is a high
GAP. With 3,190 stores nationwide, Gap is the
consistent fallback option for casual clothing
TIFFANY & CO. Growth that looked positive
for luxury has been put on hold considering
needs (from the likes of Tony Hawk, Avril
Lavigne, and Vera Wang) is its recipe for 24 2,884 $m BED BATH AND BEYOND. The retailer’s
historic leadership in the category is due to
degree of competition for moderately priced staples. Nevertheless, this once iconic brand the state of the world economy. However, success. Despite the recession, the retailer
the depth and appropriateness of its product
Avon coming from high end cosmetic lines has been losing ground for the last several the luxury retailer has been doing steadily continues to grow, offering low prices and
mix. Bed Bath & Beyond is a steady player in
entering the mass channel. Direct seller Avon years. Efforts to get back on track include well. While Tiffany does not appear to lead quality merchandise. From 81 stores in 1992 JCPENNEY. A major contender in the retail
its category. Shopper loyalty is waning due
has invested more than US $100 million in streamlining operations. One website carries the market, the company claims a large share with approximately US $1 billion in sales the industry, JCPenney is quick to launch new
to the poor housing market and the brand
its research and development operations, four of the parent company’s brands Gap, of mind, often mentioned in books, movies brand has grown to 1,000 stores in 2008 private labels, develop game-changing
has not implemented anything substantial
introducing more sophisticated skin-care Banana Republic, Old Navy, and Piperlime, and songs; its trademarked Tiffany blue box generating roughly US $16 billion. New stores advertising campaigns, and devote resources
to further solidify its position; no new
products including a new US $54 face cream. and encourages shopping across brands is unmistakable, and the company invests are LEED certified (Leadership in Energy and to improve the store experience. Its online
marketing initiatives, no updated customer
With fewer American women at home during shipping them together for a flat US $7 fee. in premiere real estate. Founded in 1837, Environmental Design), an important store continues to grow increasingly relevant,
experience or store formats to its fleet of 800,
the day to answer the doorbell when the Gap’s main distribution center boasts the the brand stands for quality and longevity. distinction in retail; and the concept is flexible with promotions and services that connect
nor has it executed an integrated touchpoint
“Avon lady” calls, the bulk of Avon’s sales now largest solar power installation in Northern The brand had to refocus a few years ago enough for 62 small-format stores in four key back to the store. Penney’s has 1,660 stores
strategy. However, Bed Bath & Beyond
comes from outside the U.S. The company is California, and its product RED (AIDS to reaffirm its high-end appeal, as some urban locations. The use of online marketing and a demonstrated ability to increase
keeps doing what it’s done consistently and
by far the world’s largest direct seller with 5.4 Foundation) campaign is part of a global merchandising mix drove the brand to novelty to develop a conversation with younger productivity. With an experience aimed at the
efficiently. While the company does have a
million representatives in over 100 countries. charitable movement. The company plans to level. This reaffirmation has worked well and shoppers helps maintain a loyal base and middle class mom who can find something
number of private labels, these do not seem
It boasts that every second of the day, a expand into Mexico as a joint venture with the brand’s positioning has recentered as generates traffic without relying solely on-trend for herself as she shops for her family,
to be a major draw. Customer relevance (i.e.,
woman buys an Avon lipstick. a major department store, and is offering exclusive. Tiffany’s has expanded into eyewear on sales and promotions. The website the brand’s mantra is “Every Day Matters.”
merchandise curated for newlyweds,
franchise opportunities as far away as Egypt and reentered watches to drive revenue generates US$ 240 million in sales and has Its focus is on developing enduring shopper
homeowners, college students) is solid and
and Jordan. In the meantime, Gap has hired a and relevance to consumers. The company demonstrated 30 percent growth in one relationships and moving away from the
The beauty market new head of design to revive the product. maintains exclusivity with a small number of year. Exclusive brands account for 35 percent promotional habits the retailer has become
without surprises. Advertising support seems
lacking—given the failure of Linens N Things,
is growing even in a stores, currently 184, to keep from diluting
the brand. New formats include a men’s only
of total sales. While the in-store shopping
experience isn’t remarkable, Kohl’s is still in
known for. Initially, the new brand position
helped increase perceptions and satisfaction
the company may have had the opportunity
slow economy, but store and a smaller footprint store for urban an excellent position to continue to grow and until the recent economic changes caused the
to capitalize on its market presence and
customer loyalty rather than settle into
there is a high degree and offbeat areas such as college campuses obtain leadership status in its category. retailer to again rely on promotions versus
lower costs and promotional advertising via
which would carry Tiffany’s lower-end silver. lifestyle advertising. JCP has proven successful
of competition for with the launch of American Living and
circulars and mailings. However, the brand
moderately priced Avon. other exclusive and private label brands, the
has put forth great effort to expand into
Canada and Mexico.
expansion of Sephora inside the store, and the
development of the Simply Green department.
ABERCROMBIE & FITCH. The brand’s AMERICAN EAGLE OUTFITTERS. According PETSMART. In the heavily competitive pet RADIO SHACK. Radio Shack started in 1921, BATH & BODY WORKS. In spite of the slow MARSHALLS. The other major player in
notoriety with adults and popularity with to Teen Research Unlimited, the American products sector, PetSmart is the largest surviving economic ups and downs including economy, fierce competition and little brand the TJX Group, Marshalls has 762 stores in
young people comes from its club-like Eagle brand was recently considered the specialty pet store based on sales of US the strong threat of big box and mass loyalty in the personal care and beauty sector, 42 states and 14 in Puerto Rico. Though
shopping experience and provocative “coolest” brand second to Nike. With that $4.7 billion a year in over 1,000 stores, merchandisers. Thus far the company Bath & Body Works is investing in its brand. both banners are synergistic in their
imaging. The Canoe store design features accolade, 1,100 stores and US$ 3 billion in and growing. The company focuses on has successfully readjusted its strategy to Last year it improved the store experience, philosophies and operating platforms,
white molding and black louvers on the revenue, this retailer of casual wear for the operational excellence to drive a great compete financially, closing underperforming creating a modern day apothecary to replace Marshalls differentiates itself from T.J.
exterior, interiors are dim with a lingering 15- to 25-year old customer has a strong shopping experience for humans and their stores and making square footage more the original country store feel. The company Maxx with a larger shoe offering, a broader
scent of “Fierce,” an Abercrombie & Fitch market position. Continually improved favorite creatures, which are encouraged to profitable. Although its product offering isn’t also updated its online and order fulfillment men’s selection, and an expanded juniors
fragrance, and the blasting of electronic merchandise, recent store remodels, and an shop for their own toys and treats in clean always the most attractive, Radio Shack is capabilities, designed a new look for its department supported by youthful, energetic
dance music at 80 decibels. A&F maintains aggressive marketing strategy that reaches stores with wide aisles and short check- the biggest national retailer that sells private signature lines, and zeroed in on the needs of marketing that touts the advantages of
authenticity and exclusivity with 353 its target audience drives the brand’s success. out lines. Shoppers can find full service vet label wires and component audio and visual the core customer. The product assortment being “shamelessly shopportunisitic,” a fun
locations in the U.S. and Canada, and three American Eagle created its own media hospitals in 685 of its facilities. Employees equipment. It has 7,000 stores (averaging was narrowed by 40 percent after smaller message that encourages frequency. Like T.J.
flagships, one in London. Store associates company, 77Entertainment, to produce are trained for superior customer service 2,000 sq. ft.) as well as 700 wireless kiosks assortments tested well, and a new supply Maxx, buyers strategically source closeouts
are called models, and an “Impact Team” and original content for its website, stores and and a portion of their incentive pay is linked in airports. This gives it a low rent structure chain system is poised to pay off, giving stores from designers and manufacturers to stay
“Visual Managers” maintain store standards networks such as Facebook, MySpace, and to customer/pet satisfaction. The company that attracts browsers. The brand works the ability to stock shelves based on what is on trend. Sluggish sales growth at other
of presentation. It works to imbue the YouTube in order to promote the brand to its operates almost 100 PetHotels with 24- very hard to remain relevant and innovative, selling at a particular location. A mall staple retailers mean plenty of inventory is available
polo shirts and jeans with a mystique far customers. Promotional campaigns include a hour supervision, on-call vets, Doggie Day upgrading its stores to make its products for almost 20 years, Bath & Body Works has to resellers. Marshalls recently introduced
beyond collegiate-inspired, casual clothing. free online concert with the Jonas Brothers, Camps, and climate controlled conditions. more interactive. It’s unclear, however, how around 1,600 U.S. stores and is expanding “The Cube” juniors fashion boutique into
Role of brand is exceptionally high and the sponsored tailgates, and spring breaks. An “Eating Green” guide informs shoppers much credit consumers are giving the brand. into Canada. its stores and is integrating it online. Still,
clothing demands a premium price. Although Because many of its young customers lack a about organic pet food. The brand promotes the store environment is challenged by the
wayward sex appeal will always attract youth, credit card, website ae.com offers PayPal as animal charities and the adoption of strays. seemingly endless racks that are part of the
if the recession brings frugality into vogue, an option. The brand sees itself approaching It offers a loyalty program and carries private off-price “treasure hunt” atmosphere. Since its
34 36
it may hasten the brand’s life cycle. Until maturity within the next three years in terms label foods at a variety of price points. As the business model is tied so closely to consumer
then, even with a decline in same store sales of store expansion, when it intends to seek shopping experience evolves, many PetSmart 1,134 $m 1,112 $m spending, traffic is up and margins continue
because of the recession, Abercrombie & Fitch growth with additional categories—lingerie, stores still need to be refreshed. And although to be strong.
is still holding up as a hot retailer. lounge and workout wear, and personal care there is room for improvement, touchpoints
products—much the same as every other appear to be integrated and work at keeping
It works to imbue the URBAN OUTFITTERS. With 130 fashion T.J.MAXX.The off-price retailer is performing
specialty apparel retailer. passionate pet parents happy and involved
apparel stores in North America and Europe, well in the downturn. Its competitive
polo shirts and jeans
38
with the brand.
the brand’s retail strategy is to create an advantage comes from its price, selection,
with a mystique far 1,073 $m
emotional bond with the 18-30 urban dweller broad customer base, and the weak economy
beyond collegiate-inspired, by making shopping a distinctive form of that’s driving bargain hunter traffic. The
casual clothing. exploration. Urban Outfitters uses design as company is an opportunistic buyer, sourcing
28 1,592 $m
BANANA REPUBLIC. As consumer spending NETFLIX. The company has gotten used to
generate business. Visual merchandisers and
display artists develop a unique look for each
inventory discipline and wider margins during
the downturn by operating with leaner than
boutique concepts to promote exclusive
product lines,and establish its credibility as
has decreased, Banana Republic has seen the hearing predictions of its death as an online store, which typically has multiple levels and a usual inventories and buying closer to need an expert. However, its primary competitor
lowest decline in sales across the three stores system for renting DVDs delivered by mail. grand staircase that allows shoppers to make to increase return on inventory. Within its Sports Authority has copied the strategy,
OLD NAVY. The most notable aspect of Old that make up Gap Inc. The brand is perceived Blockbuster is the market leader in DVD rentals; their own dramatic entrances onto a loggia stores, the brand has enhanced its visual and even a clear leader like Dick’s must
Navy is its kitschy, satirical tone and retro as offering classic styles, unique detailing, Wal-Mart tried to take a piece of the business; overlooking the store. The brand has merchandising with lifestyle images, and compete with mass merchants and specialty
feel while purveying value-priced trends and affordable luxury. With the fewest Apple and Amazon have announced movie developed a methodology for reinventing itself introduced a “Runway” section for designer shops. It wins by aligning with major
for the family. It has the highest revenue stores of Gap Inc. (575), it has a loyal base of downloading services; cable companies and new for every teenage generation and continually brands—however, the clutter typical in off- sporting organizations and is now focusing
of all the brands in Gap Inc.’s portfolio. Old customers among stylish urban professionals, products promise the delivery of Internet video hunts cool through countercultures, taking price environments is still apparent. Online, on services. The marketing budget is spent
Navy faces wide competition and has been 25-49. Banana Republic recently launched an to television sets. However, Netflix shows how an style risks and resisting “chain store” behavior, customers can sign up for “What’s In” alerts very efficiently, the brand touchpoints are
undergoing an identity crisis for the past eco-friendly line of apparel made from organic innovator can establish and maintain such strong i.e., duplication of stores. Analysts attribute from other shoppers via mobile phone who consistent, and its message is clear. Dick’s
several years. Refocusing on hip young and soy materials. A new merchandise brand equity that it’s valued higher than its bigger last year’s double-digit growth to the delivery spot designers like Dooney & Bourke and recently acquired sporting goods retailer
moms will help reestablish the brand, as planning system will allow it to deliver its competitors. The brand boasts 12 percent of the of spot on merchandise where it previously Roberta Gandolfi at the local store. T.J. Maxx Chick’s to expand its presence on the West
will its planned joint ventures with MTV. offering more efficiently. Furthermore, in US$ 8.4 billion annual DVD rental market which it had been too fashion-forward. The brand has 847 stores in 48 states and plans to Coast. It has yet to experiment with different
However, the chain is beginning to get an attempt to integrate the brand into local expects to be large and lucrative for a long time. seems to be learning to manage the downside expand. It differentiates itself from Marshalls formats, sticking to the big box.
a negative quality perception. Target’s experience, it is offering a City Insider Guide However, the company recently introduced a of risk and share best practices between its with expanded accessories and fine jewelry.
designer fast fashion has definitely hurt the booklet which outlines the best restaurants, service to deliver movies and TV shows to PCs sister stores (Anthropologie and Free People).
Old Navy position. Its recent introduction bars, and museums in major cities across as streaming video, an early and important As a result, the retailer looks to be in better
of a faster product development process the world. Banana Republic continues to step in the transition to movie distribution control of its inventory, the design of which
will allow them to better compete. Old Navy remain relevant to its customers by bringing via the Internet—a shift that probably won’t will continue to be the ongoing challenge for
has just over 1,000 stores nationwide and them a sophisticated, yet still affordable, come quickly due to technology barriers and its merchants.
an outlet chain. It is looking at the size of shopping experience. the entertainment industry’s fear of piracy and
the box and determining better ways in cannibalization. The category will be a mix of
which it can use the space to be more DVDs, streaming, and downloads much the way
operationally efficient. music is accessed via radio, CDs, and iPods.
J. CREW. This specialty apparel company AMERICAN GIRL. A wholly-owned subsidiary BIG LOTS. The economy favors discount MEN’S WEARHOUSE. In the specialty men’s WHOLE FOODS MARKET. Despite the AÉROPOSTALE. Since its spin off from
offers heritage classics with a modern twist of Mattel, American Girl has devoted its stores and Big Lots is doing well meeting sector, suits are still selling despite the recent growth in natural and organic food, its role as a Macy’s store brand in the 80s,
but without elitism. Everything is J. Crew business to building strong character in girls the needs of those on a low or fixed income, economy, but sales are fewer and suits sold the brand’s success lies in its skill as a retailer. Aéropostale has become a very successful mall
labeled; its 285 stores, catalog, and website 3 -12 through the sales of historical 18-inch as well as middle class bargain hunters. But are of lesser quality. Men’s Wearhouse has Tasked with redefining the existing food destination. It designs, markets, and sells its
are brand consistent. The stores are located in dolls, their storybooks, and accessories. the company has also experienced declining the number one market share in suits in the marketplace, the brand changed what own merchandise to 14 to 17 year olds. It has
upscale malls and shopping centers and carry The dolls provide a child’s perspective of inventory turnover which could render it out U.S. and Canada, and has been on Fortune’s many perceive as an uneventful chore into a fleet of 850 stores in 47 states, Puerto Rico
very high quality clothing with a solid pricing significant events that helped to shape of sync with the current trends and reduce its list of “100 Best Companies to Work For.” It a memorable experience. Shoppers are and Canada, has been named a “hot growth
structure and little need for markdowns. the United States. A visit to one of only margins. However, Big Lots has an edge over continues to grow by opening new locations, immersed in the abundance and color that company” by BusinessWeek (2003-2006) and
Renowned CEO Mickey Drexler works with his six American Girl Places is the ultimate in the competition in economies of scale and as well as the acquisition of AfterHours fills shelves for a visual sensation known is faring well financially with its sweet spot
design teams to keep the merchandise fresh experiential retail. Wreathed in nostalgia, pricing. It claims its food, health and beauty, tuxedo rentals. To become relevant for to inspire people. Decomposable shopping pricing. Although the brand has little category
and popular for its targeted 25-40 year olds. they are idealized versions of the luxurious home products, and hardware are “cheaper a younger customer, it is concentrating bags, value tours where customers learn to influence and takes design and trend cues from
Drexler is betting big-name designers are department stores of yesteryear. A day at than Wal-Mart.” However, its low market share marketing efforts and merchandise offerings shop the store on a budget, organic and value other retailers, young people are loyal to its
played out, repositioning his brand as quality the store buying matching outfits for doll (1.1 percent) demonstrates that the brand has to appeal to the more trend-conscious private labels, and Whole Foods’ commitment prices which continue to attract business and
goods at a fair price. The company is leery of and daughter, then having tea and finger not managed to capture enough attention to customer. The brand has systems in place to helping local and global food economies buoy the company in tough economic times.
a store building binge that would induce the sandwiches can cost a parent several hundred be considered influential. With 1,353 stores to communicate with each customer make it a leading innovator in the category. Millenials, who tend not to shop in department
brand to over-promise and under deliver, like dollars. The offering is freshened occasionally concentrated in California, Ohio, Texas, and through promotions and loyalty programs, US $45 million of corporate support is in stores or where their mothers shop, prefer
Starbucks and Gap. Last year, J. Crew’s sales through the introduction of new dolls and its Florida, some analysts believe the company and maintains consistency throughout place for the rebranding efforts of the Wild Aéropostale’s smaller boutique-like format
per square foot were US $569, well above the stories, and the retirement of others. has already maximized its growth potential. shopper touchpoints. It strives to deliver Oats acquisition. With just under 300 stores that emphasizes value as well as ambiance.
US $400 average for the sector; 28 percent of The company has allocated capital to open 15 a differentiated experience by showing located in the U.S., U.K. and Canada, Whole Finding bargains and fashion has great appeal
total revenues came from web and catalog A visit to the new stores per year and remodel others over how products work together in its classic Foods is also experimenting with the size of to its teenage core. Aéropostale is a fast
sales, also markedly higher than competitors. the next three years. Big Lots is upgrading its uncluttered environment. Every consultant is its box. A smaller store concept is being tested growing retailer with plans to open 76 more
American Girl Place shopping experience, testing a new layout trained to understand the customer, how to on a college campus; it’s also testing a new stores in 2009, and remodel others in the new
HOLLISTER. The brand strength of this RENT-A-CENTER. The outlook for the rent- BARNES & NOBLE. Although there is no
46 547 $m 48 496 $m 50 420 $m
California surfer-inspired retail chain to-own market is positive as economic issues growth expected for this market, bookstores
has thus far enabled it to avoid reducing push a growing segment of the population get bonus points for being able to defend
TRACTOR SUPPLY CO. Although Tractor GYMBOREE. Over 30 years ago, Gymboree ANTHROPOLOGIE. The word “anthropology”
prices in the face of competition and a to look to it for solutions. Although store their territory against mass merchandisers
Supply Co. doesn’t sell tractors, it does sell launched one of the first structured play means the study of people and cultures, and
tightening economy. The company believes consolidation last year demonstrated some and online retailers. With 798 locations
tractor equipment. Everything for the health centers for preschoolers, Play &Music centers. being perceived as international is important
that full price is essential to preserving its of the potential weaknesses of the business across 50 states and a growing web presence,
and containment of livestock and pets can be In 1986, responding to demand from parents, to this brand’s positioning. The success of the
aspirational stance. A recent study by U.S. and brand, Rent-A-Center is the largest Barnes & Noble is the leading book retailer
found at the store as well as tools, hardware, the company entered the apparel business chain comes from its ability to entice 25- to
Bancorp Piper Jaffray ranked it first for four player in the market in terms of store count in the U.S. with Amazon and Borders in hot
lawn and garden supplies, and work clothes with a line of wholesome high-quality 40-year-old wealthier women, who are
consecutive seasons as Teens’ Top Clothing (3,050 stores in 50 states) and revenue. The pursuit. It maintains low inventories and is
The brand is well-developed, intelligent, and clothes for kids up to 12 years old. It currently more immune to economic downturns.
Brand. The store has developed standards brand differentiates itself with clear benefit reducing promotional activity while delivering
highly relevant to its rural niche. With around operates over 600 Gymboree stores in the Anthropologie’s 118 stores sell not just apparel,
for every aspect of the shopping experience: messaging and has plans in place to upgrade strong customer satisfaction ratings. Barnes
800 stores in over 40 states, it expands into U.S. and Canada. The brand has experienced gifts, and home décor in a romantic storybook
product design and presentation, marketing its shopping experience with a more engaging & Noble’s aggressive pricing and in-house
smaller towns where it won’t compete with remarkable recent growth. Every function cottage atmosphere (as well as a catalog and
imagery, music and lighting, fragrance format, intended to help establish loyalty and publishing creates industry advantages; the
big box home improvement. Tractor Supply in this nimble company has set quantifiable online), but the idea of a lifestyle described as
and energetic associates. Live images from reinforce its strong repeat customer base. website is in the top 15 for multi-channel
has several well supported private brands, a goals that contribute to the company’s casually charming garden teas, bohemian travel
Huntington Beach stream to a five-foot- RAC’s service offerings continue to evolve retailers. Overall, the brand is maintaining
magazine, a credit card, and an online channel bottom line, from sales to operations. It adventures, eclectic and witty dinner parties,
wide flat screen “window” in 366 Hollister with the introduction of new products as influence in the category by creating new
since 2007. The business is susceptible to continually searches for ways to improve sales and, yes, coffee sipped in a Parisian cafe after
beach cottage stores that target 14- to well as services (e.g. financial), and over time, services aligned with selling more books. It
changes in weather and housing markets, and customer satisfaction. Play & Music is a trip to a flea market. “That’s why I shop at
17-year-olds. The brand has plans for three the brand quality has continued to improve spends minimally on advertising, instead
but a laser-like focus on its niche provides the a natural way for Gymboree to acquire new Anthropologie,” declares a typical customer.
stores in Canada, and a rollout of bath and both actually and in terms of perception. investing in the stores and its website.
brand some insulation. Even at the end of customers; it also plans to expand with more “I want the clothes, objects, and assorted
body products across the operation. Although there remains some inconsistency BarnesandNoble.com works to attract new
an economically tough 2008, Tractor Supply boy-focused business. Although the economy fripperies that would complement a lifestyle
across executions of the brand touchpoints, customers, drive add-on sales, and link back
reported same store sales increases. The is impacting everybody, Gymboree sees most I very much don’t have.” Only recently has the
the company’s brand investment far outpaces to store events. The shopping experience
company likes to say, “You can buy everything parents as reluctant to stop spending on their company begun to integrate the systems and
competitors. The market opportunity may lie is impressive, with extensive service on the
we carry someplace else, but you can’t find children. The company is marked by a culture structures of its direct and in-store businesses;
in overcoming cultural barriers to attract the floor, cafes, areas to relax, and soft selling. The
someplace else that sells everything we carry,” that celebrates progress and makes sure shoppers were frustrated when merchandise
Hispanic customer. brand is representative of best-in-class retail.
which speaks to a realistic branding approach employees feel rewarded for their enthusiasm did not cross over from the catalog to the store.
and consumer relevance. and energy. Shoppers will no longer be frustrated.
In today’s interconnected “always on” Over the last 15 years Mexico has enjoyed
2 4 2
LIVERPOOL. The only aspirational brand
world, no one seems to be immune to a unprecedented economic growth, new
1,828.5 C$m 368.4 C$m 515 U$m on the list, this well-known department
downturn, even a country like Canada opportunities for its people, and a gradual
store operates under two names, Liverpool
which was originally expected to remain rise in the standard of living. Retailers
and Fábricas de Francia. Both offer
relatively unscathed back in September. worked hard to differentiate themselves
CANADIAN TIRE. A major player with an SOBEY’S. Sobey’s is trying to set itself apart BODEGA AURRERÁ. By 1991, when parent designer clothing, famous name cosmetics,
Stores may be chasing fewer dollars as and attract the rising middle class.
excellent reputation in its home country, from the rest of the traditional grocery company Cifra entered a joint venture with appliances, and home furnishings to an
the Canadian economy moderates. Retail Indicators suggest that the economy
Canadian Tire has over 1,100 retail outlets category with a food-focused strategy Wal-Mart to create Wal-Mart de Mexico, upper income shopper, with over 80 stores
sales and consumer confidence have is now slowing down: fewer exports, a
across the country. Nine out of ten Canadians relevant to its customers’ changing needs. Bodega Aurrerá had built 30 years of valuable divided between its two banners. They also
been trending downward. Whatever the decrease in investments and tourism, and
shop its home improvement, sporting It has opened up Sobey’s Express stores to brand equity. Since then, the original brand share the same website. Liverpool’s flagship
outlook, these five brands are poised to a slowdown in the remittances Mexican
goods, and automotive products. It also has serve time-pressed consumers, and co- name and store format have seen continued in Mexico City is an iconic art deco landmark;
rise to the challenge with continued great immigrants send home from the U.S.
offerings in general merchandise, apparel, branded a nutritional food line with Disney expansion. There are now over 300 units, most stores are multi-level mall anchors. The
brand management. Because they have learned how to thrive in
gas, and financial services. A heritage brand targeting kids aged 3 to 12 and their parents. which include the Bodega Aurrerá warehouse- designs are clean, modern, and sophisticated,
a rapidly changing and uneven economy,
with 97 percent awareness levels, the retailer By extending its hours and leveraging its style stores that sell groceries, clothing, and in the manner of Macy’s. Its “Fashion Fest of
these five brands are ready to successfully
operates a big box format in populated areas, private label brands, Sobey’s aims to maintain general merchandise, as well as Mi Bodega Liverpool” presents new trends with all the
tackle the challenges ahead.
1
but has developed stores one-third that its reputation as one of Canada’s best Aurrerá, a smaller general merchandise fanfare of a Victoria’s Secret fashion show and
3,137.5 C$m size in small rural communities to alleviate grocery shopping experiences. Meanwhile, format for less populated regions. Wal-Mart’s many of the same supermodels. The company
customers’ travel cost burden. After 90 years, the company is investing heavily in store expertise has been especially important in is expanding by developing malls and opening
1
the company decided to move its catalog expansion and the remodeling of its network, the construction of regional distribution new stores throughout Mexico, including a
SHOPPERS DRUG MART. Shoppers is from print to online to reduce costs and be with an eye on adapting its offering to serve 1,344 U$m centers. The brand is notable for its animated duty free concept in tourist areas. It also has
Canada’s largest retailer of home healthcare more socially responsible. As the largest the rapidly evolving urban markets with superhero mascot who battles high prices, plans to bring Sfera fast fashion apparel stores
products and services with over 1,000 retail full-service retailer in Canada, customers medium to high population densities. Mamá Lucha. She represents the iconic to Mexico through a new joint venture with
drug stores, more than 60 Shoppers Home continue to prefer it over rivals such as The ELEKTRA. The dazzling yellow and red personality of a traditional Mexican mom: Spain’s Corté Inglés.
Healthcare stores and nine million members Home Depot, Rona, Lowe’s and Wal-Mart. façade of the Elektra store is a common sight warm, caring, and fiercely protective. She
in its Optimum loyalty program. Shoppers throughout Mexico. Often described as a appears on the company’s website which has
Drug Mart (operating as Pharmaprix in
Quebec) operates in prime locations, with 5 352 C$m blend of Sears and Best Buy, the retailer sells
furniture, appliances, consumer electronics,
clear family appeal. Initiatives to emphasize
low prices in the store include posted signs
5 104 U$m
clean well-organized stores and a robust
product offering. It has plans to expand by 10 3 485.8 C$m and motorcycles— and now cars, thanks
to the brand’s recent alliance with Chinese
carrying dated cashier receipts comparing
prices of Aurrerá’s items with the same items
percent a year, which includes 150 Shoppers LULULEMON. Hailed for its grassroots automaker, FAW. The retailer sells one out of from competitors. Aurrerá’s prices are favored.
Simply Pharmacy stores, a format designed approach, authenticity, socially responsible every four television sets in Mexico. Banco SUBURBIA. Suburbia is becoming a staple
to work within hospitals. Innovative new RONA. Rona has nearly 700 stores selling values, and unique company culture, active Azteca, its microlender arm, has a branch in in the gleaming new malls being built
prototypes have included smaller formats for hardware, home renovation, and gardening wear retailer Lululemon Athletica downplays every store. The combination of credit and throughout Mexico. Owned by Wal-Mart
pharmacy only and beauty only. The original
Shoppers Drug Mart concept has equity in its
products; it is less established in English
Canada than it is in its home province
its role as an apparel store in favor of selling
its garments as a component of personal
affordable prices make it possible to buy hard
goods—even a car—and pay in very small 3 310 U$m de Mexico, the 80-plus department stores
offer mostly private label apparel and
luxurious beauty department. A high level of of Quebec. The four-prong approach to well-being. It promotes health consciousness, weekly payments. It’s a prime example of the targets middle-income families. Suburbia
dedication to private labels will help the brand serve its segment includes expanding environmental awareness and human retail-to-banking model other companies, recently refreshed its brand image with a
retain higher margins as consumer spending existing store networks, building new potential. Its authentic yoga garments are such as Wal-Mart, appear to be copying. SORIANA. The second largest food retailer in new pink and purple logo, and a modern,
slows. Shoppers has earned its reputation as stores, recruiting independent dealers, and made from its own specialized fabric blends. Its stores are no-frill affairs; however, its the nation, Soriana operates more than 200 fresh female-centric image which is being
one of the best managed brands in Canada. making acquisitions. To keep ahead of the Lululemon’s impressive growth has been website has a clean modern feel with a stores in three formats: Soriana hypermarkets integrated into its marketing, website, and
competition, the retailer is expanding rapidly cultivated through its loyal customer base. lifestyle message. Within Mexico’s burgeoning selling apparel, general merchandise, and store environment. Its new slogan, “More
with its upscale, well-designed, and easy- By testing its products with local athletes retail scene, Elektra has the opportunity to groceries with optical, medical, photographic, than expected for less” emphasizes the
to-shop stores. Multiple store layouts and and fitness instructors before opening shop grow well beyond its more than 800 stores. and financial services; Mercado Soriana value proposition and makes the retailer
formats give Rona the flexibility to efficiently in a market, Lululemon has built unique Elektra’s parent company, Grupo Azteca, superstores serving middle-income shoppers more relevant and engaging to its shopper.
operate in communities of different sizes. and powerful relationships with brand owns Televisión Azteca; as a result Elektra in small cities; and City Club which wholesales Although Suburbia stores have felt a
Feeling the heat from The Home Depot and advocates—most stores even offer free yoga benefits from plenty of airtime. to small businesses, similar to Sam’s Club. slight impact as spending has contracted
Lowe’s, Rona is leveraging its native identity classes. Whether this is a sustainable business Soriana also franchises a chain of convenience somewhat, the company celebrated three
to differentiate itself from competitors. It model in the fickle world of apparel, only time stores known as Super City. In 2007, it added new store openings in November 2008.
also plans to increase support of its private will tell. But for now, Lululemon is a rising almost 200 more stores with the acquisition Wal-Mart de Mexico plans to continue the
labels, which are recognized for quality like star with 40 stores in Canada, 36 in the U.S., of one of its chief rivals, Grupo Gigante. The strategic expansion of its brands, including
the brand itself. two in Australia, and four in Japan and plans resulting expansion has raised revenue but Suburbia, across the country.
to grow carefully to 250 stores worldwide lowered the retailer’s profit. Nevertheless,
by 2012.
Most Valuable 3
4
Ikea
Tesco
Sweden
UK
7,373
5,502
6 M&S UK 4,197
Working on your brand’s strengths will
mean the difference between the weak 7 Aldi Germany 3,348
11 ASDA UK 1,273
CARREFOUR. Although this year saw IKEA. Year after year, the world’s largest with T-mobile), and cost reduction due to
hypermarket, supermarket, convenience furniture manufacturer has shaped its sourcing in China, IKEA saw a seven percent
store, hard discount store, and cash and carry stores into an out of town destination. It sales increase in 2008. While the year was also
giant Carrefour Group facing deteriorating provides well-priced, good quality Nordic marked by accusations of animal cruelty for
global consumption trends, particularly in design furniture (3,000 new products filled selling reindeer meat, and blinds that tragically
Europe, the brand’s aggressive promotional with inspiration and new ideas), often contributed to the death of a one-year-old-
policy helped the group stabilize its market complete with services like restaurants girl (which IKEA immediately recalled), it has
share in France and improved its position serving Swedish food, a mini-shop selling enhanced its reputation by putting an end to
in Spain. Critical factors that also helped Swedish style groceries, and a free of charge plastic bag consumption in all US stores, and
drive performance up 44 percent include its play area for children. With more than 20 has promised to invest 50 million Euros in five
decision to rebrand its Champion & Shoppi new store openings, increased presence in years to small and medium-sized enterprises
brands name stores under the Carrefour Asian markets, the steady growth of online that provide solar panels and new solutions to
banner, as well as its expansion into emerging shopping in the US, a new virtual mobile reduce water and energy consumption (which
markets like India and Russia. Additionally, phone network in the UK (a partnership IKEA will eventually sell in its stores).
its move to offer green electricity in all of its
stores in Belgium (with hopes of expanding
to France), have helped to freshen up its
reputation. The arrival of Lars Olofsson,
an experienced leader and specialist of the 4 5,502 €m
fast moving consumer industry, accelerates
Carrefour’s strategic focus to adopt different
TESCO. The international grocery and general and Tesco personal finance, and a 30 percent
formats to new trends on the market. In
merchandising retail chain with a UK base is growth in online sales all contributed to the
order to find similar success in the year ahead,
still number one in the UK, providing simple brand’s success this year. Still, despite a solid
Carrefour will have to fix its negative price
and quality products at low prices with reputation among a diverse range of shoppers
perception among shoppers while managing
great range and diversity in each category and a well-established and consistent
the success of its accessible locations, and
and division. Tesco successfully launched strategy for growth (to follow the customer
improve the quality of its private label and
Tesco Digital and a new 350-strong range of into large, expanding markets at home and
double loyalty program.
low-cost products featuring two private label new markets in Central Europe, Asia, and the
lines: Market Value (a new fruit and veggie US), Tesco saw a weak holiday season, losing
line) and Discounter (dry grocery, frozen, out to competitors Aldi and Lidl as shoppers’
health, beauty, and dairy). Robust growth in tighten their belts.
newer areas, strong growth in Tesco mobile
5 4,469 €m 6 4,197 €m
ZARA. In the last year, Zara has overtaken MARKS & SPENCER. Leading international behavior away from quality to value.
H&M as Europe’s largest retailer. It has opened department chain Marks & Spencer is the In 2009, M&S announced it will cut back
186 new stores during the fiscal year and largest UK clothing retailer, and sells items advertising spending by 20 percent.
diversified by moving into home furnishing that include clothing, food, homewares, As consumer spending continues to change,
and a “Zara for Mum” line. Additionally, its furniture, and technology. This year, it will be interesting to see if M&S’s core
Meco logistics platform in Madrid, introduced M&S invested heavily in updating its store offer remains relevant.
in 2006, lets Zara introduce new items every environments to make them more attractive
week. Zara has stuck to a strategy that has to customers and focused on improving its
proved to work: strategically located stores, online platform. Although M&S is growing
layouts that take advantage of each store’s ahead of the market and maintains a strong
unique visual and functional space, and a brand image—it set a trend toward the
brand message “Buy it now or regret it later” environmental and ethical—its reliance on
that builds on its ability to translate trends the UK market makes the brand vulnerable
into merchandise, from drawing board to to current economic conditions. While it is
shelf in just two weeks. Improved efficiency, still the leader in general merchandise and
logistics, and cost-consciousness, as well as has achieved an increased market share
entrance in the Russian and Asia markets, in a number of categories, the economic
resulted in a nine percent increase in brand downturn has brought a shift in consumer
growth. Its globally diverse position and low
cost products place it in a better position than
most of its European retail competitors.
ALDI. This no-frills grocery chain and deepest BOOTS. Boots continues to lead the AUCHAN. The privately owned merchandise EL CORTE INGLÉS. Over the last few LIDL. The primarily European grocery retailer EDEKA. Germany’s largest supermarket
discounter in food retailing has successfully pharmacy retail category, maintaining its retailer of apparel, groceries, fast food, years, Spain’s largest department store and Lidl, headquartered in Germany, operates corporation currently holds a market share
elevated its status with its improved brand status as the specialist in healthcare. Over consumer electronics, real estate, and banking supermarket chain owner has successfully its supermarkets under the trading name, of 26 percent. Its large assortment of private
message “the store for smart shoppers.” And the last few years, the brand has started to services is known for offering discount prices, enhanced its relevance to younger Kaufland and its discount food stores under labels and product lines, good service, and
thanks to its “Aldi Principle” strategy—the behave more and more like a category leader. choice, diversity, and adaptability. This year, generations, with A-list celebrities for Lidl. Lidl carries a large selection of products takeover of 2300 stores from competitor
lowest prices with the highest quality Following the roll out of its new “local Boots it maintained a loyal audience and increased campaigns and brands like Sfera. Despite its at a low price point, which has contributed to Tengelmann, as well as an aggressive
implemented in every store, a clear product pharmacies,” it has increased innovation, credibility as a sustainable brand by halting already impressive scale, the business has its growth. This, matched with an aggressive attack on discount giants Aldi and Lidl have
range, a private label smartly displayed, and particularly in beauty, and developed a more the sale of red tuna (a fish in danger of ambitious growth targets and plans to have a strategy to develop geographic presence contributed to Edeka’s continued growth.
savvy expansion—it has seen a significant coherent point of view regarding healthcare. extinction) in all of its stores, which was well presence in every city in Spain, in addition to internationally and nationally, and the Although Edeka showed a huge increase in
increase in brand value over the past few 2008 saw increased overseas expansion, received by customers. Other key highlights rolling out its stores across Southern Europe. launch of new private labels such as Bioness image perception from 2006 to 2008, several
years. This year alone, Aldi increased market provision of health and optical services to an in 2008 included improvements to its private The brand has also made moves to balance its and Linessa, have helped drive the brand’s scandals weakened brand perception in
share by 19 percent, entered into hotel and increasingly aging population, regular retail label brands. Packaging was updated to portfolio, and although it faced some issues performance. While it was a good year for 2008, including employee spying, pesticide
shopping malls in the UK, and increased promotions to drive store traffic, and a solid clarify nutritional information, recipes were with private brand names such as Emilio the brand, its reputation was put in jeopardy residues in grapes and paprika powder, the
stores throughout the foreign market. Its performance by its private label products. modified so they were healthier, and Auchan Tucci (similar to Emilio Pucci) and Boomerang when the press leaked that the store had sale of falsely labeled free-range eggs, and
efforts have paid off; it received 99 percent In 2009, the market leader may feel even introduced an organic cosmetics line to build (similar to Boomerang TV) it found a hit with been spying on employees at work and during rotten meat. Edeka plans further expansion
brand recognition—a notable increase from more of a squeeze by outside competitors, on its green image. Auchan also diversified. “Bricor” a DIY interior design category killer. A breaks. To improve its image, Lidl launched despite the economic climate, with a highly
the year before. While this year proved to including smaller pharmacies and groceries It set up a joint venture with Nakheel Retail, gloomy 2009 outlook for the European retail an emotionally driven TV campaign, a major anticipated growth rate.
be a great one for the brand, the overall with an in-store pharmacy. a real estate developer belonging to the Dubai market has forced the brand to down-trade, turn for the brand. In 2009, Lidl may see the
influence of the financial crisis may stifle its World group, and launched its mobile network by creating the private label brand “Aliada,” overall financial crisis harm its international
international expansion. “Hyperclair” in France. In 2009, Auchan may which offers products at a price far cheaper expansion, and the dioxin crisis in pork meat
see its leading presence in China challenged than any other brand at the supermarket. from Ireland reduce meat sales.
by the multinational retail giant Wal-Mart.
SEPHORA. In 2008, the leading retail beauty THE BODY SHOP. The Body Shop’s natural ARGOS. The market leader in many MERCADONA. Currently the largest KAUFLAND. The hypermarket Kaufland, OBI. The German do-it-yourself chain
chain in Europe saw growth in emerging inspired beauty products have seen growth in categories, Argos benefits from its scale and supermarket operator in Spain with a market which is operated by grocery retailer Lidl, is that offers goods for homebuilding, repair,
markets like the Middle-East and China, emerging markets like India, Russia, the Middle logistical advantages. It can price products share of 12.7 percent, Mercadona is devoted known for long hours, good accessibility, a gardening, and home design, is constantly
improvements to its private labels, an East, and Asia. It continues to be viewed as very competitively across categories, to its brand strategy—the “Top Quality Model” pleasant buying atmosphere, and a great increasing market share, extending to
increased US presence, and a new 45 percent a leader in the sustainability movement, but passing on purchasing efficiencies to the end in which the customer is the boss.” It even variety of products, with both private label families as well as the classic DIY shopper.
stake in the Russian perfumery chain “Ile de the brand is not as recognizable as it could customers. Its multi-channel offering—ability involves customers in the development of its and consumer brands. It has experienced It has seen success with a more emotionally
Beaute.” It was also forced to close seven be among young consumers. The business to buy online, by phone or text, then collect supermarkets. Before it opens a new store, continuous national and international driven package and design for its private label
stores in Japan, due to high property prices has taken note, investing in modernizing the in the store or have the product delivered—is it asks potential clients to try the store out growth. Kaufland benefits from its emphasis brand, as well as TV spots and bulk mailings.
in city centers and an indifference to its brand both in-store and online. Additionally, also compelling to customers. Each year since and offer feedback on layout, products, and on service, which differentiates it from The high content and easy navigability of its
self-service offer in the market. It plans to it has plans to launch baby products and “The 2000, the brand has opened an average of policies. It scheduled more than 83,000 competitors like Aldi and Lidl. It has also new, friendly website has helped support its
counter the closing by opening 100 stores in Body Shop at Home,” an initiative similar to 30 stores a year, with a total of 707 based meetings like this in 2007. It also worked benefited from its private label brand, accessible and fun image. OBI is currently one
China. Additionally, it made improvements Tupperware parties. With more and more in the UK and Ireland. While the brand has to integrate stores in traditional markets, K-Classic—although recalls on its marmelade of the best known brands in Germany, where
to its website in the US, offering clients more competing beauty products that also play a distinctive business model with no clear respecting customs and original architecture, in January 2008 has harmed its reputation. it gets 50 percent of its sales. Next year, it
information about the brands, launched on sustainable values, The Body Shop may direct competitors, it is not considered a while also helping storekeepers recover their In 2009, Kaufland may see its international will continue to expand into foreign markets
an in-house spa concept in the Gulf region, have difficulty maintaining its loyal audience. leader in each product category. The brand businesses. Overall, it has an excellent brand expansion stifled, as well as reduction in and will work on extending and improving its
and focused on improving the quality of its Moreover, it will have to compete with lower is working on increasing value perceptions, image, which has only been enhanced by its meat sales due to the dioxin crisis in pork private label brand.
salespeople by launching “Sephora University.” consumption in stores in the United Kingdom having acquired the Bush and Alba brands participation in sustainability forums with Al meat in Ireland.
In 2009, the brand will be testing out selling and the United States as a result of the in 2008. Argos will launch its concept Gore. Currently, sales are increasing due to
its products on television in France, a strategy economic environment. As The Body Shop internationally after a test in India. the economic crisis and its recognized and
that may ultimately devalue the positioning begins to adopt more mainstream advertising valued private label brand, Hacendado. The
of its brand. channels in 2009, shifting from its origins as brand has also started finding ways to cut
an activist brand—an equity that would be price, like removing cardboard boxes from its
dangerous to lose—it will be interesting to see line of toothpastes.
how it affects brand perceptions.
MANGO. This Catalonian brand’s strength SAINSBURY’S. The third largest supermarket the emotional benefits of shopping, rather FNAC. French book, music, and electronic REWE. REWE is the second largest
lies in its ability to quickly translate trends chain has lost market share over the last eight than undeliverable brand promises. Despite retailer FNAC operates in six European supermarket chain in Germany and the third
into merchandise for the masses. Like Zara months, due to Tesco’s aggressive marketing a strong location performance in London countries and Brazil. International revenues largest in Europe. Its combination of brand
and H&M, it has a fast turnover of stock campaigns and the rise of Morrison in the and South East England, the economic grew two digits (particularly in Italian and name products and strong private label
so there is always something new in the South. After closing 49 of its convenience condition of the company remains unsteady. Brazilian stores). During the second half of products, as well as its assortment of fresh
store. But while it continues to grow, with stores, Sainsbury’s has attempted to gain Because the brand rests comfortably between 2008, FNAC.com relaunched as a full-fledged, meats, has helped leverage its image as a “time
an extensive expansion plan to penetrate back market share through a recovery the more up-market brands like M&S and user-friendly online shopping site and FNAC saving and consumer friendly one-stop-shop.”
new markets, it still remains far away program, “Making Sainsbury’s Great Again.” Waitrose, and the cheaper players like Tesco saw the benefits. The company also launched Self-employed merchants lead the majority of
from the two fast fashion leaders. 2008 The slogan, “try something new today” was and ASDA, it risks “death of the middle” as a new product that allows viewers to access its stores, which has further leveraged REWE’s
marked a continued expansion strategy, in launched to get consumers to purchase more price sensitivity hardens. FNAC videos on demand from their TVs, and positive image. It is beginning to catch up
which Mango opened its second store in varied goods, and keep shoppers focused on saw success in many of its new store formats. with market leader Edeka through takeovers
New York (they expect to reach 240), the Still, with CD sales sliding, and pressure and expansion, including its acquisition of
development of flagship stores, as well as from new competitors like Apple, Orange, 245 “Extra” stores from Metro in Germany.
partnerships with different brands in order and Amazon, FNAC is reducing the number REWE also has ambitious plans to expand
to create what they called “Mango shopping of planned store openings. To combat the into Austria, Italy, and Eastern Europe. Its
experience.” Clients can shop while sipping economic crisis, FNAC will have to continue expansion—coupled with a strong marketing
complimentary champagne, snack on free to improve its product offer. campaign and its partnership with Germany’s
chocolate, and take home a free fashion national women’s soccer team—worked in
magazine with each purchase. While Mango REWE’s favor this year. However, REWE faces
has seen success expanding into the US and tough competition from Aldi and Lidl in the
China, it has experienced some setbacks with future, as customers continue to become
its franchise in the UK and Ireland due to a more price-conscious.
poorly managed supply chain (wrong stock
in the wrong place due to a lack of a proper
technology system). 2009 will mark a new
face for the brand—model Dakota Johnson.
Signage, the creation of curb appeal, a signature air fragrance, a clutter-free check-in, and a luxurious bedding and bath
experience were created to complement Holiday Inn’s new brand vision.
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