Top 25 Retail Report KantarRetail

The Top 20
Most Valuable
Global Retail
Brands 2010
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Welcome to this Kantar This report helps illuminate the radical
changes reshaping retail as shoppers,
chastened by the recession and empowered
Third, retail is becoming even more
competitive. In developing markets, retailers
face tough competition both from traditional
Retail analysis of the with technology, think differently about what

and how they purchase. Here are just three
of many critical considerations:
outlets and the modern trade. In saturated
“post-modern” markets, hyper competition
for share of wallet has replaced expanding
Top 20 Most Valuable First, brand is a prerequisite of retail

success. How retailers build their brands
square footage as the engine of growth.
Suppliers play a critical role in helping
retailers succeed amid the local
Global Retail Brands impacts all aspects of their business. Brand

is key to effective merchandising. It converts
private label from a margin-building tactic
competitive forces.
This report elaborates on these

to a strategic symbol of brand equity. Brand considerations and many others. It provides
alone secures an enduring place in the mind the ingredients needed in order to thrive in
of the consumer. It is fundamental to the this new retail environment: the best data,
supplier-retailer relationship. original insights and compelling ideas that
will drive our businesses forward.
Second, retailers own the conversation with
shoppers. Through their loyalty programs Kantar Retail is pleased to provide this
and daily interactions with shoppers, report. We believe that it will help you
retailers have the most authentic and think differently about your business, its
perpetually updated understanding of challenges and opportunities.
the shopper. This knowledge is critical to
suppliers who need to engage with their Sincerely,
retailer customers to actively participate
in the conversation.
Wayne Levings
CEO Kantar Retail
Analysis by Kantar Retail from Bryan Gildenberg and Ethan Sinick

Design by Lambie-Nairn
Writing by Ken Schept
GLOBAL RETAiL BRANDS 2010 3
CONTENTS
Welcome 2
Introduction 6
Overview 10
Commentary 18
The Top 20 Profiles 22
The Top 20 Summary Chart 62
10 Key Takeaways 68
Methodology 70
About Kantar Retail 74
Directory 76
4 GLOBAL RETAiL BRANDS 2010 5

iNTRODUCTiON in a turbulent economy,
when flat was the new up,
that performance signified
the resilience of brands
The report also corroborates the stability
of retail brand value over time. In 2006,
The BrandZ ranking of the Top 100 Most
Valuable Global brands included 10
retail brands. And those 10 retail brands
The overall brand value of the and their importance in

comprised about 9 percent of the total
brand value of the Top 100. In 2010, 9
helping to stabilize and
retail category declined by just
retail brands are among the Top 100,
sustain a strong bond representing about 8 percent of the total
value. The difficult economy primarily
1 percent last year. with customers, even as
customers reset their
accounts for the slight decline.
In fact, the Top 10 most valuable global

priorities and restrained retail brands remained quite consistent over
spending. the past five years, although the relative
ranking shifted somewhat. Two instances
This key conclusion emerges from this of dramatic brand value growth – Amazon
second annual report about the leading and ALDI – illuminate major trends. On
global retail brands. The report combines the strength of a 359 percent increase in
the broad retail knowledge and analytical brand value Amazon moved from Number
skill of Kantar Retail with the definitive 8 to Number 2, indicating the revolutionary
global top 100 most valuable global brands impact of e-commerce. ALDI’s 241 percent
valuations produced annually by Millward increased in brand value signifies the
Brown Optimor drawing on financial data consumer’s increased concern with price
and the WPP proprietary BrandZ database. and embrace of private label.

iNTRODUCTiON
Especially during periods of economic

Expanded report uncertainty, like the last several years, both 5-Year Review of Retail Brand Value
This report examines these trends and consumers and businesses increasingly
other dynamics that last year drove overall rely on strong brands for the reassurance
retail industry brand value and the value of and reliability they represent. Knowing the
# 2010 Rank 2010 Value 2006 2006 Value % Change
individual retail brands. More than twice the value of this intangible asset, a brand, helps $US Bil. RANK $US Bil. in value
size of the inaugural Most Valuable Global corporate leadership and stakeholders
Retail Brands report, this edition includes: make more informed decisions. 1. Walmart $39.421 1 $37.567 5%
2. Amazon $ 27.459 8 $ 5.983 359%
• An overview that interprets how post- To determine a brand’s value, WPP’s
3. Tesco $25.741 3 $15.532 66%
recession consumer attitudes and Millward Brown Optimor relies on BrandZ,
the most reliable and comprehensive 4. Carrefour $14.980 5 $10.803 39%
emerging trends will reshape retailing.
brand equity database available anywhere. 5. Target $12.148 7 $6.135 98%
• Commentaries that explore the impact of Started 12 years ago, BrandZ contains 6. eBay $9.328 4 $13.191 -29%
e-commerce and the enduring power and information from more than one million
7. Home Depot $8.971 2 $27.312 -67%
profitability of brands. consumers in 30 countries. The brand value
calculation combines the BrandZ consumer 8. ALDi $ 8.747 16 $ 2,566 241%
• Profiles of the Top 20 most valuable global information with financial data from both 9. Auchan $7.848 9 $5.354 47%
retail brands including analysis, forward- company and independent sources. For 10. Lowe’s $7.008 -- -- --
looking insights, statistical summaries and complete methodology details, please turn Sources: Millward Brown Optimor
photographs illustrating current formats to page 70.
and innovations.
The growth of Amazon and Aldi respectively
• Takeaways that recommend specific reveal the growth of e-commerce and the
practical actions to help assure success in importance of value. The decline of eBay and
the post-recession retail world. Home Depot reflect the difficult economy.
Get the full BrandZ Top 100 report

To access the complete BrandZ Top 100 Most Valuable Global Brands 2010 report,
go to www.BrandZ.com. For a free download of any of the BrandZ 2010 smart phone
apps, go to www.BrandZ.com/mobile.

OVERViEW Retailing emerged from Indeed, the retail brand that grew most in
value last year operated no stores. While
the recession changed by the retail category as a whole declined 1
the consumer’s virtually percent in brand value, the value of the
Amazon brand appreciated 29 percent to
unrestricted access to
Forget location, location, location. information and products
$27.5 billion, moving it into second place
behind Walmart, which does operate
and a revised view of stores—8,000 of them worldwide—and has
Retailing is becoming more spending and material
a brand value of $39.4 billion.
complicated. well-being. Factor in the dramatic rise in smart phones

and data transmission and it becomes clear
Having spent 18 months tightening that the future of retailing will emerge from
budgets, consumers now seem ready the tension between location, location,
to resume discretionary purchasing. But location and algorithm, algorithm, algorithm.
they remain cautious. While excited to Success will require both merchants adept
replenish wardrobes and replace durables, at massaging customer egos and analysts
consumers are more considerate of the skilled at massaging customer data.
impact that their purchases have on the
earth and its people. And they’ve learned As brands heavily invested in bricks and
to live with less. mortar seek ways to keep stores relevant,
store size will shrink. Because of the costs
They’ve also learned to shop and challenges of adding new stores,
retailers will attempt to extract more cash
differently. E-commerce has grown
flow from their existing stores. These
in just a few years from an ancillary initiatives could improve large stores,
retailer revenue stream to a central which sometimes are inconvenient to shop,
place in the shopper’s repertoire offering more selection than customers can
of purchasing options, redefining process at the shelf but less than they can
the role of stores themselves. It’s a find online. At the same time, retailers risk
oversimplifying their stores and eroding the
rapidly growing global phenomenon,
shopper experience.
best illustrated by the US, where
online transactions account for Here’s the takeaway: Competitive
around 6 percent of annual advantage in retailing no longer can be
retail sales. accomplished simply by saturating markets
with stores and attracting customers
with a combination of range, price and
service. Success requires a thoughtful
portfolio of shopping venues—physical and
virtual—that appeal to specific shopper
segments. Every retail brand needs to find
a proposition that makes visiting these retail
spaces worth the shopper’s time.

OVERViEW
The e-commerce and mobile revolution

Share of wallet Share of decision is a major opportunity for retailers that
It’s always easier and more capital and In a multi-channel world, consumers have successfully reorganize their businesses
cost efficient to sell more to an existing a lot of choice. Share of decision is about for a digital world. A large part of winning
customer. That truism becomes a retail getting them to choose you. in this world is being the platform people
imperative now. turn to when making purchasing decisions.
When retailing was exclusively about Retailers need to become part of the
And precisely understanding that opening and operating stores, retailers active conversation that goes on around
customer becomes more important strongly influenced the shopper’s these purchases. Digital also poses an
than understanding trading areas and understanding of price and assortment existential threat. Either retailers win their
geographies. The era of growing the top in key categories. They mediated the share of decision or risk becoming simply
line and market share by opening ever decision-making process. That mediation points of distribution and pickup. In the
more stores is over. The primary strategy role is threatened as technology enables future, a retailer not engaged in the digital
for building a retail business is shifting from consumers to enjoy almost unlimited access conversations impacting the business could
growing market share to growing wallet to products and product information. be reduced to just a box of stuff with a
share—from saturating a trading area with roof—a brand positioning to avoid.
square feet of space to selling as much as With mobile commerce, customers
possible to the shoppers loyal to the brand. are increasingly able to receive real-
This shift can be explained in part by
time information in their hands as
demographics in developed markets. In the they shop. When a mobile phone
US, for example, economic recovery will be empowers a shopper at the point
moderated by high unemployment among of sale with as much information—
the young, a dearth of people in their prime or more—than is available to the
wealth-creation years and the bulge of baby retailer, the retailer’s role in that
boomer with reduced net wealth nearing
under-funded retirements. In Europe and
transaction fundamentally changes.
Japan, retailers face aging populations with Shoppers are less influenced by
formats that may not be configured for the location, price messaging and
childless households that will comprise store experience if, with the push
most of the foot traffic. of a button, they can find a desired
product at the best price.
Some of the challenge is attitudinal.
Consumers in developed markets remain The shopper’s immediate access
concerned about the future. And while to this information neutralizes
they still expect mass market prices, the retailer’s role as the arbiter
they’re increasingly unsatisfied by mass of price and assortment.
market products. In general, they prefer
more personalized items, but without the
premium that personalization implies. And
consumers, of course, can obtain products
through many channels other than stores.

OVERViEW
The Top 20 Most Valuable Global Retail Brands 2010 2010
# Position Brand Parent Company Brand Brand Brand Brand

change Value Value Contribution Momentum
from $US Bill Change
These brands had few options except to
Renewing the brand emphasize affordability and prepare for
2009 YOY
But first steps first. Many retail brands post-recession spending. Retailer success 1. = US Wal-Mart Stores, Inc $39.421 -4% 2 8
adapted extremely promotional tactics to in that environment will require a more
cope with the recession. As brands enter nuanced understanding of customer needs 2. 1 US Amazon.com, Inc $27.459 29% 4 9
the recovery, they’ll need to consolidate or and wants and an offering of products,
modify some of those tactics. services and formats to match them.
3. -1 UK Tesco plc $25.741 12% 5 4
Especially in the early days of the recession, Leveraging the brand 4. = France Carrefour SA $14.980 0% 5 7
reflexive discounting and cautious buying
reduced excessive inventory. Consumers To fortify their brands and leverage their
5. 1 US Target Corporation $12.148 -1% 4 7
enjoyed the savings and understood equity, retailers implemented private label
the tactics, especially from brands that solutions while at the same time relying
symbolized value in more normal times. on national brands to drive traffic, which 6. -1 US ebay Inc $9.328 -28% 3 7
Discounts by up-market or even luxury becomes even more important as shopping
retailers delighted shoppers but risked trips decline. While much retailer private 7. 1 US The Home Depot, Inc $8.971 -3% 2 3
stretching brand credibility. label continued to depend on the reflective
glow of adjacent national brands, retailers 8. 1 Germany ALDI Group $8.747 1% 1 6
For example, Sainsbury’s, the UK grocer, increasingly introduced incandescent
uncharacteristically promoted value with private labels that emitted their own light 9. -2 France Auchan S.A. $7.848 -26% 4 7
campaigns like “Feed your family on a and power—with equity derived from the
‘fiver.’” Sainsbury’s success suggests that retailer’s brand. 10. 1 US Lowe’s Companies $7.008 10% 2 5
great retail brands do not retreat from value
but rather integrate it into the brand as a IKEA and ALDI, the deep discount grocer, 11. 4 US Best Buy Co Inc $5.807 18% 3 8
strategic attribute rather than an expedient remained strong examples of retail brands
tactic. It helped, of course, that Sainsbury’s that have become synonymous with the 12. -2 Sweden IKEA International A/S $5.710 -15% 3 8
was in the food business at a time when products they sell. Lidl, an ALDI competitor,
consumers were focused almost exclusively continued to balance its strong private Marks and Spencer
13. -1 UK $5.699 -5% 5 3
label with national brands. Target, the US Group Plc
on needs over wants.
discount department store, adopted that 14. -1 UK Wal-Mart Stores, Inc $4.922 -9% 3 7
For brands selling wants during the hybrid approach in the rollout of its new up
recession, the message hardly mattered. & up private label, which uses an upward 15. 2 US Kohl’s Corporation $4.371 12% 4 5
A steep decline in the brand value of pointing arrow as a logo signifying the
eBay reflects how much the online retailer brand’s commitment to quality and price. Lidl & Schwartz Stiftung &
16. = Germany $4.102 -1% 1 5
depends on discretionary spending. The The UK’s Marks & Spencer began to offer Co KG
evaporation of home equity and tightened selected national brands side-by-side with Costco Wholesale
17. -3 US $3.875 -26% 1 4
credit impacted sales—and brand value— its iconic St. Michael’s private label. Corporation
for home furnishings and improvement
18. = US Wal-Mart Stores, Inc $3.255 -7% 1 6
leaders like IKEA, Home Depot and Lowe’s.
19. = US Sureway Inc $3.173 -8% 2 4
20. = UK J Sainsbury Plc $2.728 -4% 5 4
Sources: Kantar Retail, Millward Brown Optimor. See the At a glance charts for brand footnotes and see
Methodology on page 70 for explanations of Brand Contribution and Brand Momentum.

OVERViEW
The changing consumer A global perspective

Brands also need to acknowledge Finally, as retailing becomes more
the shifting values of the post- complicated and challenging in developed
markets, retail brands increasingly will
recession consumer. Concerned seek growth in BRIC and other emerging
about the impact that their material economies.
well-being has on the planet and on
people at every stage of the supply They will find consumers more eager to
chain, consumers are moderating spend money. But they’ll also encounter
indulgence and excess with a increasingly powerful local competitors that
have recognized the same opportunities.
binary view of spending that pairs However, because Brazil, Russia, India and
entitlement with responsibility and China are in such different places in their
individuality with community. retail evolution, their conflation into the
acronym BRIC adds confusion rather
Retailers respond to these consumer than insight.
concerns for a variety of reasons: because
sustainability improvements reduce costs; It’s more illuminating to consider how each
because good citizenship strengthens the country sits along a continuum of retail
customer bond and drives shareholder market evolution. The continuum begins
value; or because of genuine commitment. when pioneer brands arrive to organize
Whatever the reason, retailers must an informal and fragmented market of
respond. And their commitment needs to family-owned businesses. It stretches until
be credible and consistent with their brand’s consumers shop at both the informal trade
overall ethos. and in a well established organized trade
that consists of modern stores serving
European retail brands may be somewhat many product sectors.
more responsive to these consumer
concerns, particularly sustainability. But In this context, the Brazilian market already
sustainability has become a bit more is intensely concentrated into three modern
mainstream everywhere and the notion that retailers: Carrefour, Casino’s CBD Group
it commands a price premium is beginning and Walmart. China remains fragmented
to disappear. Being in touch with these but is rapidly moving toward concentration,
long-term shifts is part of understanding the particularly in the coastal cities. The Russian
post-recession world. And retailers who get market is intensely influenced by “disruptive
that right are most likely to flourish. factors” (government and the lack thereof)
that drive a unique pattern of concentration.
Similarly, regulation has kept India a nation
of shopkeepers with only 3 percent of retail
coming from the organized trade.

COMMENTARY
1. Thinking differently about problem
solving. Bricks and mortar problems often
are easy to identify but difficult to fix.
Knowing that comp sales are down in five
E-commerce is no longer just stores may isolate a management problem.

Fixing it is something else. In e-commerce
a nice way to top-up sales.

the opposite is true. The overwhelming
by Michael Ross
amount of data about customers, orders,
clicks, and fulfilment can obscure the
problem. When the problem is isolated,
Organizations that still however, the solution can often be easy.
regard e-commerce as a
Example: You may discover that a large
bolt-on are squandering a volume of customers is being directed to
major opportunity to gain an out-of-stock product. That should be a
insight and grow revenue two-minute fix.
and profit. And they’re 2. Thinking differently about decision-
placing themselves at a making. In a physical store it’s not easy to
dangerous disadvantage. know exactly what products customers
are looking at. In e-commerce you know
Moreover, in today’s exactly what every customers views, adds
slow-growth economy, to cart and buys. More precise information
is powerful. It enables you to determine
e-commerce needs to be whether a product isn’t moving because
an integral part of any retail people aren’t looking at it or because
enterprise. But success people are looking at it but not buying.
An accurate diagnosis leads to a fast and
requires thinking differently effective solution.
in many ways:
Example: Without accurate information,
you’re left with a trial and error response.
Discounting, the default response, can
waste a lot of time and produce no
extra turns if shoppers aren’t looking at
the merchandise.

COMMENTARY
3. Thinking differently about business Even more important, e-commerce analysts who can sift data to discern why
organization. Retailers typically structure will change retailing. The stores of the
Not the end of shops a product turns—or not. Such unions will
management according to traditional (near) future will be much changed from The rise of e-commerce does not presume require wisdom and humility. But they will
functions such as marketing, merchandising today’s shelf-lined boxes stuffed with the end of shops. People like shops. We produce remarkable competitive advantage.
and finance. In e-commerce that’s expensive inventory. We’ll see fewer and love to touch the merchandise. But it does
often sub-optimal. While the traditional smaller stores. Ultimately, stores may Michael Ross is director and co-founder
mean that the most successful retailers
management structure maps neatly onto become experiential showrooms. Such a of Ecommera, a leading e-commerce
will be those who understand both the
an existing retail organization structure, development would completely change the solution provider delivering technology
physical and virtual channels profoundly and
it often makes it hard to make rapid economics of retailing, as the merchant and insight. michael@ecommera.co.uk
learn the lessons from each to build and
trading decisions. wouldn’t need to have stock sitting in operate a solid and integrated multi-channel
hundreds of different locations. presence. Brilliant merchants always will Ecommera is a WPP Digital Partner
Example: Sales of a particular product are Company
have an important place, but they’ll need
underperforming. Do I spend more on a Retailers heavily invested in bricks and
to marry their intuitive feel for buying and
search engine? Do I discount the product? mortar real estate might fairly argue that
selling with the technical knowledge of
Do I discount delivery? When each function it’s difficult to turn the battleship around.
has a different budget and reporting line, I would agree. But I’d add that if you’re
the lengthy decision-making process often not looking at the horizon, you won’t have
results in lost opportunity. a battleship to turn around. Consider the
e-commerce implications for brands. In the
implications for retailers past, brands relied on retailers for national
distribution. With a few flagship stores and
and brands a wholesale program brand marketers could
cover the whole country, even the world.
As you can see from the preceding E-commerce enables brands to sell directly
examples, even thinking like an e-commerce to consumers, make higher margins, have
merchant will sharpen your business. You’ll more control and no longer need to deal
ask better questions and expect faster and with a lot of stores. Brands can radically
more useful answers. reshape their distribution strategies. And
retailers who make money today selling
And you’ll have a more accurate handle these brands will need to rethink their role
on performance. In the bricks and mortar in the retail landscape or risk waking up one
world, profit per square foot is a key day to find they have no products to sell.
performance indicator. That’s not the case
in e-commerce. E-commerce retailers
need to understand the trade-off between
profit-per-order and volume of orders. This
allows them to understand whether the next
dollar should be invested in retail prices,
marketing, discounting delivery or
a promotion.

ThE TOP 20
1.WALMART Plus, shopper attitude changed a bit last

year. While shoppers continued to spend
cautiously because of the economy,
they’d passed their initial panic and fear.
Less dependent on Walmart’s low prices,
Meanwhile, Walmart invested in the brand’s
online presence because its greatest
threat comes not from bricks and mortar
competitors but from online operators,
specifically Amazon. Scale and global reach
shoppers probably felt less grateful. At should help. Though the Walmart brand
Wal-Mart relaunched its brand the same time, assortment changes may
have confused or alienated some shoppers
value declined slightly, last year the Walmart
Corporation posted sales of over $400
as Walmart last year. looking for a more complete grocery

trip. Walmart remained the consumer’s
billion from over 8,000 stores, in 12 formats,
operating in 15 countries. And 25 percent of
advocate, however, as it continued to its sales came from outside the US.
convert operational cost savings into
price reductions. And with well publicized
reform of its labor practices, commitment
to sustainability and advocacy for health
reform Walmart continued to repair the
broader pillars of its brand.
The subtle spelling revision signified
shifts in brand positioning and store
execution that may have provoked
At a glance
shopper confusion, as brand value $39.4 billion
Brand Value
declined slightly. Brand Value Ch
ange YOY% -4%
Sales $406.4 billion
Total Company
Expansion slowed and sales grew modestly. Stores 8,051
Total Company
But the discount superstore chain, which The new Walmart logo, intro d Sales $294.6 billion
duced last year, appears
here on a store in Mt. Prospe WALMART Bran
operates about 4,500 stores worldwide ct, Illinois, a northern d Stores 4,577
suburb of Chicago.
WALMART Bran
under the Walmart banner, posted strong eration 15
Countries of Op art, Walmart Supe
rcenters,
profit. The results reflected both effective es include Walm wn Optimor
Walmart brand sal tai l, Mi llw ard Bro
urces: Kantar Re
Walmart.com. So
management of the business and a tangible
Throughout the store, Walmart reassessed
benefit of a brand that enriched its core ct store in North
Bergen, New Jerse
y, the
entire categories and departments, At a Project Impa d fashion reflects the
proposition from “Low Prices, Always” to price an d im pro ve
combination of low “Save money. Live better.”
designating them as win, play or show, new Walmart tag
line,
“Save Money. Live Better.”
depending on their growth potential,
and assigning appropriate space and
Walmart continued to implement its “Project
merchandising investment. The store
Impact” initiative aimed at simplifying
program helped clarify the evolution of
in-store execution to produce a more
Walmart from its roots as a hardlines
consistent brand expression. The specific insights & implications
discount store to its next phase as a general
goals included: removing clutter and
merchandise retailer selling groceries to • Walmart’s influence is weakened as shoppers become less reliant on the brand for price and product
improving signage to make shopping easier; information that they increasingly access on their computers and mobile devices.
its current iteration as a grocery retailer
reducing labor, stock keeping units, and
with a large general merchandise range. • Walmart needs to achieve the right balance between two somewhat conflicting imperatives: removing
inventory to lower costs; and increasing items from the assortment to gain store efficiency and operational savings; and adding items to the
However, Walmart’s decentralized culture,
private label to improve earnings. assortment to satisfy customer needs and expectations.
which thrives on local entrepreneurship, can
produce store-to-store inconsistencies and • As Walmart broadens its brand beyond price, the company needs to be clear that price remains
sometimes shopper confusion. a core aspect of the proposition.

ThE TOP 20
2. AMAZON Amazon and Zappos share a problem-

solving ethos. The formation of each
company depended on asking – and
answering – the same question: what’s hard
about buying this product? For Amazon
As consumers slowed spending last year,
Amazon also benefited from its many
revenue streams other than retail sales,
which include: advertising, third-party
licensing arrangement, rebates, Prime
the product was books. The physical Membership dues, Kindle sales and
Amazon grew 29 percent in brand layout of a library or bookstore prevented
books relevant to the individual patron from
royalties from electronic book sales.
value last year making it one of being in convenient proximity. The problem
with purchasing shoes online was that
the fastest growing global brands

the product often did not fit, a customer
concern until Zappos offered unlimited free
returns. Both companies provided digital
across all categories. interface solutions.
At a glance
$27.4 billion
With improvements in price, Brand Value
nge YOY% +29%
selection and service Amazon Brand Value Cha $24.5 billion
Sales
Total Company
achieved a retailing trifecta. Total Company
Stores 0
$23.5 billion
By combining its online data into This Amazon home page prom
AM AZ O N Br an d Sales
0
Stores
complex algorithms Amazon AMAZON Brand
otes the Kindle while
showing the brand’s broad
product category range.
ration 7
ascertained the bottom of the Countries of Ope azon.c om /ca /co.jp/co.uk/de/fr.
les include am
Amazon brand sa wn Optimor
market faster than most retailers So urc es : Ka nta r Retail, Millward Bro
and priced accordingly. Unparalleled

selection also helped Amazon Amazon continues
to revolutionize the
book category wh
ere the
dominate the holiday season. brand began.
Easier to open packaging and Amazon’s brand value growth last year
free two-day shipping for its Prime also resulted from the introduction of
Membership subscribers improved Kindle 2 and the acquisition of Zappos,
the service experience. developments that fortified the company’s
market position. With the Kindle 2, Amazon
Having invented a better idea, Amazon leveraged the consumer trust earned as a insights & implications
has invested heavily in the technology book merchant to expand into electronic
• Amazon has an opportunity to expand its model into other aspects of people’s lives by offering more
and distribution required to sustain it. reading devices. Amazon has defined the product categories and venturing into services. It could add a bricks and mortar presence.
The brand now looms as a revolutionary distribution medium for electronic books
• The company’s success will draw more intense competition from highly efficient retail competitors that
force of engineers and mathematicians in the way Apple’s iTunes impacted music.
understand complicated distribution and technology, such as Walmart.
posing an existential threat to traditional Although Zappos still trades under the
Zappos name, acquisition of the online • Since Amazon operates only in six countries, it has a tremendous international expansion opportunity.
retailers invested in bricks and mortar and
still depending on the mantra of location, shoe and apparel retailer strengthened the
location, location for competitive advantage. Amazon brand at least indirectly.
ThE TOP 20
3. TESCO The exceptions to the company’s strategy

of branding all business Tesco occur during
international expansion when acquisition
of a strong local brand facilitates market
entry. Ironically, the Tesco brand is absent
With the rise of food discounters, like ALDI
and Lidl, Tesco returned to its discount
roots while at the same time keeping
the broad brand approach. It launched
a discount own label brand in the UK.
from its most successful international However, in central and eastern Europe,
The Tesco brand appreciated market, Korea, where the company trades
as Homeplus. Tesco decided to establish a
where the discount brands are strong,
Tesco operates many large hypermarkets.
in value last year despite the new brand when it launched Fresh & Easy,
a food discount operation, in the US.
In the US, Tesco’s Fresh & Easy is modelled
after low-priced Trader Joe’s, which is
difficult economy.
owned by ALDI. In 2009, Tesco operated
about half of its over 4,500 stores outside
the UK in 14 other countries.
That performance reflected the At a glance

strength of the brand, particularly $25.7 billion
Brand Value
+12%
in the UK, Tesco’s home market, Brand Value Ch
ange YOY%
$89,7 billion
Sales
where consumers view the grocer Total Company
4,768
Stores
Total Company
as the place to fulfil a wide range les $77.3 billion The Tesco loyalty
card, used with 60
TESCO Brand Sa transactions, provid -to-80 percent of
UK
of monthly household shopping
es valuable custom
or es 3,396 advantage. er data and compe
TESCO Brand St
titive
15
needs. The UK contributes about Countries of Op
eration
pess/Espres/E xpressz,
include Tesco Ex d, Tesco
umer deman
75 percent of Tesco’s total turnover. Tesco brand sales
Tesco Metro, tes
co.com.
Pressured by
co m pe tit ors and cons e recession while
roots during
th
its discount ch.
returned to oa d br and approa
its br
maintaining
Last year’s performance also was indicative
of Tesco’s ability to formulate a broad
master brand, encompassing both food
and non-food and priced from discount
to premium, that appeals to consumers
at all income levels. In the UK, where shape the own-brand strategy. Outside of
Tesco operated 2,440 stores last year, the UK, with weaker brand heritage, own-
the brand appears in a variety in formats, label business is harder to develop. insights & implications
primarily supermarkets, hypermarkets and
• With further investment in the supply chain, Tesco could experience in non-food categories the
convenience outlets, while maintaining Founded as a discount food merchant in e-commerce success it enjoys in grocery.
brand consistency and purchasing and 1919, Tesco expanded into various grocer
• Because of Tesco’s dominance as a grocer in UK, growth requires leveraging the brand into new
distribution efficiency. formats and non-food businesses that now formats for selling non-food products and offering services such as banking.
include financial services and mobile phone
Tesco offers an own-label option on about • As Tesco expands beyond its core business, it needs to narrow the brand proposition because the
operations. After forming Tesco Financial company lacks the fundamental competitive advantages.
40 percent of the grocery range and at Services in a joint venture with RBS (Royal
every price point, including premium, in the Bank of Scotland) in 1997, Tesco bought
UK. Tesco loyalty cards, used on 60-to-80 the RBS share during the financial crisis and
percent of UK transactions, provide data to rebranded the entity Tesco Bank.
ThE TOP 20
4.CARREFOUR In Europe, the Carrefour brand remains

strong in France and Spain and somewhat
weaker in Belgium and Italy. Although the
company operates some of its largest
stores in Eastern Europe, the brand makes
should enable Carrefour to leverage
marketing and advertising spending and
develop private label.
Being managed for short-term objectives

less impression there. In contrast, the brand will place Carrefour at a competitive
The value of the Carrefour brand is well established in certain emerging
markets including China, Argentina and
disadvantage against is peer operators,
however, as retailers like Walmart and Tesco
remained flat last year. Brazil, where a recent acquisition produces

some the company’s fastest growth.
continue to grow with long-term vision. If
pieces of Carrefour were sold eventually,
they would be logical buyers.
Eventually, consolidating the various
businesses under the Carrefour brand
may facilitate the sale of all or parts of
the company. Meanwhile, a unified brand
At a glance
$14.9 billion
Brand Value
ange YOY% 0%
Brand Value Ch
Sales $131.5 billion
Total Company
Stores 14,299
In the midst of a deep global Total Company
and Sales $98.9 billion
CARREFOUR Br
recession, protecting value was and Stores 3,489
CARREFOUR Br
a significant accomplishment for Countries of Op
eration 41
rrefour City,
rrefour Bairro, Ca
the world’s second largest Carrefour brand
sales include Ca
Carrefour Marke
t, Ca rre fou r Ma rket Urbain,
Retail,
Carrefour Express, urc es : Ka nta r
retailer in annual sales. And The Carrefour brand remains
strong in France, its
Carrefour Mini an
d Carrefour.com
Optimor
. So
home market. Millward Brown

it was not accidental.
The company is unifying many of its 40 country
brand in many of
its disparate retail holdings under the fou r is att em pti ng to leverage the wn he re.
Carre land sho
France, such as Po
markets outside of
Carrefour banner. The branding is part of an
effort to increase asset value implemented
by Blue Capital, a private equity group
that has controlled Carrefour for the last
several years. Through acquisitions made over 40 insights & implications
years, Carrefour evolved from a French
• The ongoing effort to unify the brand across country markets should leverage marketing investment
Until just over a decade ago, Carrefour was hypermarket to a presence in 41 countries and strengthen brand awareness.
known as a premium retailer with first-rate operating a conglomeration of almost
• The company operates with a short-term mentality at a time when major structural changes happening
locations and competitive prices facilitated 15,000 stores under various fascias. in retailing demand long-term vision.
by world-class buying. The focus began to Historically, about 60 percent of revenue
• The need to build and sustain a credible presence in e-commerce and the BRIC markets requires
change after the 1999 merger with French has come from the hypermarket segment significant investment. Reluctance to invest would put Carrefour at a disadvantage.
retailer Promodès and the subsequent of the business, which is almost entirely
death of one of the principals. branded Carrefour.
ThE TOP 20
5. TARGET This initiative seemed promising and

an important step for Target to brand
itself beyond “want” categories, such as
apparel and home décor, where Target
has exhibited great skill at specializing
brands, with packaging designed to mirror
the national brand’s packaging. Last
year, Target shifted from this “reflective”
approach to an “incandescent” private
label philosophy. Its new up & up brand
in products that closely match its brand emphasizes the intrinsic price and quality
Target experienced a challenging proposition—“Expect more. Pay less.”
The question outstanding is whether Target
value of Target own-label products rather
than positioning them as cheaper imitations
2009, before seeing results begin to can translate this sourcing and marketing
expertise from products unique to Target
of national brands. This matches to some
degree Target’s private label strategy in
rebound during the holiday season.

to merchandise that the consumer can food, where the retailer has always sought
find anyplace. premium positioning in line with the its
overall proposition.
To further that aim, Target also revised its
approach to private label. Until now, the
chain offered its own-brand merchandise
for a lower price than the adjacent national
As sales revived against soft 2008

holiday numbers, profit strengthened
considerably because Target At a glance
$12.1 billion
improved its inventory management Brand Value
ange YOY% -1%
Brand Value Ch
and handling of markdowns. Total Company
Sales $63.4 billion
Stores 1,740
Total Company
At the same time, the brand’s attempts Sales $63.4 billion
TARGET Brand
to be more relevant for recession-weary Stores 1,740
TARGET Brand
1
shoppers began to gain traction. While Countries of Op eration
t and target.com
slowing expansion, the 1,740-store To reach cautious post-reces es include Targe
sion shoppers, Target is Target brand sal Mi llw ard Brown Optim
or
attempting to broaden the r Re tai l,
value message of its bran Sources: Kanta
discount general merchant began d.
remodelling its existing locations to include d designer

d for its value-price chain.
Target is renowne
an increased presentation of grocery and merchandise create
d espe cia lly for the
fresh foods.
Known internally as the Pfresh campaign, message and broaden its value proposition
the expansion of food addressed Target’s by packaging some merchandise in
strategic dilemma: the chain remains on the bulk, replicating the value proposition of
wrong end of the needs-wants spectrum. warehouse clubs like Costco and Sam’s. insights & implications
Worried about unemployment and overdue Target also attempted to extend the
• During the recession, Target’s biggest competitor was the couch, as shoppers increasingly went online
mortgage payments, consumers spent emotional and differentiated power of its to purchase apparel and other merchandise that typically drive trips for Target.
on basics last year and retreated from the brand to other attributes and into other
• Target needs to establish a compelling reason for shoppers to return to the store.
fashion and design offerings that drive categories, specifically pharmacy. In its
Target’s margins and signify its brand. pharmacy TV campaigns, Target positioned • The open question for Target is whether the brand can bring a Target value proposition to food as it
grows its presence in grocery.
the brand as knowledgeable, curious
In an effort launched in early in 2010, and friendly rather than fashionable, the
Target attempted to fortify its low-price traditional Target message.
ThE TOP 20
6. EBAY Not all of eBay’s business is about selling

items, however. The company also owns
PayPal, the service that facilitates secure
online payment for goods and services.
PayPal complements the eBay business
communications company that it purchased
in 2005. Compared with PayPal and
StubHub, Skype was less closely aligned
with eBay’s core proposition.
and enables the company to broaden its The PayPal and StubHub businesses are
EBay depends on discretionary reach to merchants without credit card
processing capability and to consumers that
not calculated into the value of the eBay
brand since they trade under other names.
spending, which was not a growth prefer not to pay with credit cards. Much of the core business also is excluded
from the brand valuation because, although
area last year.

In addition, eBay owns StubHub, a reseller eBay is present in 30 countries, the
of tickets for concerts and sporting events. company often operates under the name
Last year, eBay sold Skype, the online line of strong local brands it has acquired.
At a glance
$9.3 billion
Brand Value -28%
nge YOY%
Brand Value Cha $57.2 billion
Sales
Total Company 0
Stores
Total Company $30.3 billion
Sales results slowed and brand EBAY Brand Sa
les
0
value declined as recession-wary EBAY Brand St or es
39
ration
consumers shopped for needs Countries of Ope d gross merchan
dise
The home page lists the wid ure is the estimate unt
e variety of categories, The eBay sales fig eBay country co
over wants. even cars, available on eBa
y, volume sold by the
brand in
online aucti
20
on
09
op
. Th
era
e
tio n.
includes only the wn Optimor
Retail, Millward Bro
Sources: Kantar
The process of refocusing the brand also
hindered growth. Although launched in
1995, as an innovative online auction to
join disparate buyers and sellers, eBay About half of the sales come not from od for one day on
ly, drives traffic.
The daily deal, go
discovered that the most sustainable aspect auction, however, but from fixed-price sales,
of its proposition is not the auction, but the reflecting eBay’s evolution from a somewhat
trusted access it provides. anarchic connector of individual buyers and
sellers to a more organized and efficient
For buyers, eBay offers access to a wide marketplace. The repositioning moved eBay insights & implications
variety of interesting items often at eye- into a more crowded space where it faces
• As the brand shifts from the auction business to more fixed-price transactions, it moves into direct
popping prices. The small-to-medium size a growing competitive threat from other competition with Amazon and other trusted e-commerce brands.
resellers that populate eBay enjoy access to trusted e-commerce brands, like Amazon
• EBay benefits from the mainstreaming of its brand. The fact that people increasingly regard eBay
those 90 million eBay active users. Business and Google, that also provide access to as an option when considering a product purchase confers legitimacy that allows the brand to
often is good. millions of shoppers and small resellers. enter other product areas.
• The eBay business model, not overly proprietary, is open to imitation, especially from competitors
that may develop specialized markets for catering to niches of eBay’s audience.

ThE TOP 20
7. hOME DEPOT To fill some operational gaps, legacies of the

chain’s torrid and entrepreneurial growth,
Home Depot installed more information
technology and improved its supply chain
with the construction of new distribution
In general, the company returned to its
core business and brand principles. It
closed some ancillary businesses, like its
Expo Design stores, although it continued
to develop its installation business and its
centers aimed at reducing costs and better Web site.
Home Depot’s market position regulating the flow of merchandise.
If there was a bright side to 2009 for Home
last year was about as challenging Home Depot continued to balance the
expectations of its contractor customers
Depot, it was that the economic slowdown
provided a breather, enabling the company
as it gets.
with the appeal of its stores to women to address some nagging problems and
shoppers. Men comprise 55 percent to emerge potentially with a brand that’s
of home improvement shoppers, but recovered some of its authority in price,
women have a major say in 80 percent selection and service.
of the purchasing decisions. And many
women feel uncomfortable in the busy and
sometimes chaotic environment of Home
Depot’s 2,244 warehouse stores.
At a glance
$8.9 billion
Brand Value %
ange YOY% -3
Brand Value Ch
Sales $65.9 billion
Total Company
Stores 2,244
Total Company 5.9 billion
and Sales $6
HOME DEPOT Br 4
and Stores 2,24
HOME DEPOT Br
eration 7
Countries of Op
The home improvement chain Home Depot bra
t.c
e Home Depot
nd sales includ
om. Sources: Ka
ntar Retail, Millw
ard
me de po
sought to grow business during a an d ho
Brown Optimor
s at the front
mortgage crisis that destroyed much Home De po t of te n promotes se
asonal item
of the home equity that pays for of the store.
improvements. Plus, compared with The warehouse for

mat draws both pro
s and DIY shoppers
.
its competition, Home Depot was
much more dependent on sales to
contractors at time when housing
starts reached record lows.
Home Depot focused on three priorities to insights & implications
Timing was not great for other reasons, too. rehabilitate its brand despite the economic
• The anticipated recovery in the US housing market will drive increased sales.
The recession hit just when Home Depot difficulties: improving customer service,
was about to switch gears, away from reasserting product authority and continuing • Reinvigorated customer service would help Home Depot regain its strongest point of
competitive differentiation.
five years of cutting costs and looking for to improve productivity and efficiency.
efficiencies and back to offering expertise Customer service levels, which depend • The brand also would benefit from improving the shopping experience for both its DIY and
contractor customers.
and customer service, among the brand’s on knowledgeable and engaged store
core attributes when it was established 30 associates, may have benefited from the
years earlier. availability of contractors during lean times.
ThE TOP 20
8. ALDi Both ALDI organizations face the predictable

challenge to proven success—imitation.
Germany’s Lidl entered the deep discount
segment in the mid-1970s, and today ALDI
and Lidl share 60 to 70 percent customer
in Germany and Austria, for weekly
promotions of selected consumer electronic
items, computers for example, at virtually
unbeatable prices. Today, consumers
find wide selection and lower prices
overlap in Germany. Beyond Lidl, however, for consumer electronics online. ALDI’s
In a tough year for retailing, the and in many country markets, more
competitors are adopting a discount strategy
more recent promotion tactics, mobile
phone offers and travel packages, lacked
ALDI brand appreciated slightly. to draw price-conscious consumers. equivalent impact.
At the same time, ALDI is losing a signature

traffic-driving strategy. During the end of the
1990s and the early part of the next decade
ALDI was known, especially
At a glance
$8.7 billion
Brand Value
nge YOY% 1%
l C om pa ny Sa les
Tota 9,396
Stores
D I Br an d Sa le s
AL 8,957
es
ALDI Brand Stor
With less money to spend, more ration 20
Countries of Ope
shoppers seemed drawn to the ALDI brands sales
Re tai l, Mi
i.com.
include Aldi and
llw ard
ald
Bro wn Optimor
Sources: Kantar
deep discounter’s proposition of
sharp pricing on a limited range of ALDI reinforces the
quality groceries. ALDI stores offer
brand’s key messa
ge—low prices and
no frills.
about 800 items, mostly own-label, , ALDI

tation is basic
in only 15,000 square feet of space. Although th e pr od uce presen
project qual
ity as well as
pr ic e.
attempts to
Coming out of the recession ALDI has Germany as well as Benelux, France, Spain
some work to do, however, as it faces more Portugal and Poland. ALDI North also owns
imitators and a shifting marketplace with Trader Joe’s in the US.
consumers increasingly completing some of
their food shopping online. ALDI has moved ALDI South is somewhat more premium insights & implications
into that space, but slowly. and has enjoyed success targeting mid-and
• ALDI will continue to benefit from high consumer regard for a store and private label brand that
up-market shoppers. Along with stores in consistently delivers both low prices and quality.
The German-based brand actually operates southern Germany, ALDI South operates
• ALDI should do well in the US and Australia because of limited direct competition in those markets.
as two separate organizations – ALDI the ALDI brand in UK, Ireland, Greece,
North and ALDI South – controlled by two Hungary, Slovenia, Switzerland and outside • ALDI may struggle in certain European countries because market saturation is expected to
slow expansion.
brothers. ALDI North takes an austere of Europe in the US, with more than 1,000
approach and appeals to more price- stores, and Australia. It operates in Austria
sensitive shoppers in northern and eastern under the Hofer brand.
ThE TOP 20
9. AUChAN Similarly, few businesses are branded

Auchan in Italy, the company’s largest
European market outside of France. Inside
France, government regulations added
further challenges with a move to change
grants tremendous autonomy to each store
and fosters loyalty among employees. And
it drives initiatives to creatively develop its
presence at the intersection of online and
in-store shopping.
certain retail accounting practices in an
Auchan’s strength in Russia and effort to stimulate lower prices. While the entrepreneurial approach helps
assure the right products, prices and
China helped the brand navigate A family-controlled enterprise, Auchan

assigns a higher priority to serving existing
locations, decentralization sometimes
slows reaction time, inhibits coordination
successfully through the recession.

markets well over expanding into new of marketing efforts and makes it harder to
markets. Cash flow and limited debt cultivate a unified brand image.
also regulate the rate of expansion. The
company’s entrepreneurial operating style
At a glance
$7.8 billion
Brand Value -26%
The economic slowdown Brand Value Cha
nge YOY%
$63.2 billion
Sales
compounded a key challenge for Total Company 2,624
Stores
the French hypermarket however, Total Company $37.1 billion
Sales
AUCHAN Brand
which is leveraging its global AUCHAN Brand
Stores 323
13
presence without the benefit of Countries of Ope
ration
m.
an and auchan.co
les include Auch
a unifying brand. Auchan brand sa
Sources: Ka nta r Re tail, Millward Bro
wn Optimor
Auchan remains strong in
France but developing mar
are driving growth. kets
In Russia, which is Auchan’s flagship
market, the company operated 68 stores at
the end of last year, 38 under the Auchan
ts.
brand. In China, Auchan ran 16 Auchan ’s strongest marke
are among Auchan
Russia and China
locations along with 68 hypermarkets
branded RT Mart, a joint venture with a
Taiwanese company. Relatively slow to expand internationally,
Auchan did not open stores outside of
In both countries, Auchan emphasizes the France until the 1980s when it entered insights & implications
same brand core values of lowest prices Spain and also opened a few unsuccessful
• Auchan would benefit from a more unified brand presence globally.
and widest assortment, perhaps with a stores in the US. Auchan entered Spain
slightly more premium perception in China though acquisition and retained the • Auchan’s strong market position in two key BRIC countries, China and Russia, should continue to
shape its international business.
where Auchan stores often are located in existing store fascias for it hypermarkets.
attractive shopping malls. Stores in both The Spanish stores are called Alcampo, a • Market saturation and government regulation will impede Auchan’s domestic growth in France.
Russia and China offer both food and non- rough translation for Auchan, which means
food, although the Chinese stores may be high field. No retail operation in Spain is
a bit more food oriented. branded Auchan.
ThE TOP 20
10. LOWE’S had going into the recession, and it did

not adjust significantly during the past 18
months. Its warehouse stores continued to
offer merchandise breadth and depth, but
with a relatively disciplined presentation that
of its original core markets in the South.
The company is testing several smaller
store alternatives by fine-tuning its existing
format. Because of the troubled economy,
the rollout may happen more slowly.
may appeal especially to women shoppers
Lowe’s struggled effectively against whose decision-making role is important for
the large remodelling projects that drive big
Internationally, Lowe’s continued its
expansion in Canada, prepared to enter
the housing downturn. box DIY sales volume. Mexico and, in its first expansion out of
North America, negotiated an arrangement
Lowe’s slowed its store expansion at with Woolworths in Australia to open Lowe’s
least temporarily, but still anticipates stores in that country.
increasing the store count in the US by as
much as 50 percent over time. Although
Lowe’s operates in all 50 states, it has an
opportunity to increase density outside
At a glance
$7.0 billion
Brand Value 0%
ange YOY% +1
Brand Value Ch
Sales $47.2 billion
Total Company
Stores 1,709
Total Company
But if the 1,709-unit warehouse les $47.2 billion
LOWES Brand Sa
1,709
home center chain excelled at LOWES Brand St
ores
2
eration
controlling its operations, it could not Countries of Op and lowes.com.
es include Lowe
’s
and
Lowe’s brand sal Optimor g, messaging
control the economy. Sources : Ka nta r Re tai l, Millward Brown
Lowe’s aim
s its merchan
disin
ek ee pi ng at DIYers.
hous
As housing starts, mortgage applications

and home remodelling declined, Lowe’s
sales followed the same downward trend.
Lowe’s operates in
The chain could take some comfort that and cross-border
all 50 states but has
expansion in Canad
room for fill-in US
stores
a and Mexico.
compared with Home Depot, the chief
competitor, its business is more consumer-
focused and less reliant on contractors. Ace and True Value, or at discount or food insights & implications
That difference may be reflected in the stores. And as a major contender in the
• Business should pick up for Lowe’s as housing recovers and consumers undertake major home
relative resilience of Lowe’s brand value. appliance business, which was hurt by the improvement projects. In the meantime, consumers may shop for maintenance or repair items at
recession, Lowe’s experienced additional more convenient locations.
The slow-down in home improvement financial exposure. • The company will face reinvigorated competition from Home Depot as Lowe’s chief competitor
had several consequences. The chain’s improves its store experience and service.
117,000-square-foot prototype stores, Meanwhile, Lowe’s continued to do a good • Lowe’s could benefit by helping women undertake the full range of DIY activities to dispel any
designed for major project completion, are job protecting its margins with private label gender preconception that limits the DIY interest of women shoppers to décor categories.
not the most convenient place to make item and supplementing its in-store selection
purchases, which consumers sometimes with its Web site. The company derived
fulfilled at hardware store competitors, like confidence from the strength its business
ThE TOP 20
11. BEST BUY not only impacts Best Buy’s entertainment

software business, which is 17 percent of
sales, but it threatens a critical traffic driver.
Along with entertainment, Best Buy’s

consumers. Geeks can sell a solution rather
than simply a product. Service contracts
bought at the time of product purchase are
an important profit component.
current range consists of home office Best Buy expanded its mobile phone
The Best Buy brand appreciated in (34 percent of sales), consumer electronics
(36 percent), services (7 percent) and
business, which exists as in-store
departments and as branded stand-alone
value by 18 percent last year. appliances (6 percent). Best Buy added

musical instruments, such as guitars and
locations. Best Buy was expected to gain
knowledge from Carphone Warehouse, a
keyboards. Still a relatively fragmented UK mobile phone retailer acquired at the
category, it appeals to the chain’s youthful end of 2008. The acquisition reflects the
customer base. chain’s global aspirations, which include
opening the first Best Buy store in Mexico
The brand also worked on service at the end of 2008, and in Turkey in 2009.
improvements. Best Buy’s Geek Squad of The company also has stores in China and
young techie advisors adds to revenue, will expand further into Europe. The first UK
At a glance signals a nerdy competence and helps
make technology more accessible to
store opened early in 2010.
$5.8 billion
Brand Value +18%
nge YOY%
Sales
Total Company 4,037
Stores
an d Sales
BEST BUY Br 1,222
d Stores
BEST BUY Bran
The result indicates the US chain’s ration 14
Countries of Ope st Buy, Best Buy
Mobile and
strong growth prospects following Best Buy brand
sales include Be
urces: Kantar Re
tail, Mi llw ard Bro wn Optimor
bestbuy.com So
the collapse of its main head-to-
head competitor, Circuit City, which
left Best Buy as the only national
s, Best Buy
big box specialist in the home In its at te m pt to dominate in
key categorie petitor last year.
rture of its m ai n co m
m the depa
electronics category. benefited fro
Most Best Buy sto
res have the same
one in Polaris Mall, distinctive exterior
Columbus, Ohio. as this
Best Buy enjoyed a sales benefit from merchandising attention devoted to the
the disappearance of $10 billion Circuit category. Best Buy strengthened its multi-
City, which enabled the company to channel presence by assuring that its
better weather the downturn in consumer brand appears high in online searches and
spending. The real estate opportunity with initiatives like Twelp Force, its Twitter insights & implications
from Circuit City was less significant conversation about service issues.
• Best Buy has a major opportunity to capitalize on the disappearance of a key competitor at a time
because the locations of the two chains when the consumer appetite for mid-market electronics is growing.
often overlapped. Perhaps the greatest threat to Best Buy
• Squeezed between Walmart (price and efficiency) and (Amazon (price and assortment), Best Buy
comes from an unlikely but powerful needs to establish a third way.
Best Buy still faced formidable competition competitor, Apple’s iTunes. With digitized
• Best Buy has room for global growth as both a bricks and mortar and online brand.
from Amazon.com and bricks and mortar music conveniently available online,
merchants selling electronics, especially consumers have less incentive to purchase
Walmart, which expanded the space and CDs in a physical store. That development
ThE TOP 20
12. iKEA incremental improvements to its Family

Card, a loyalty program that promotes
the IKEA value proposition by rewarding
purchasing with selected discounts.
IKEA has succeeded in becoming a family
destination, a place where parents and
children collectively select the furniture and
accessories that will surround their lives.
And when the process becomes too much
Renowned for its efficient sourcing, IKEA to bear, the kids go the play area until its
Last year people stopped spending, already had achieved high per-shopper
spending because of its annoying but
time to gather in the IKEA restaurant for a
family meal.
stopped moving and stopped effective labyrinthine layouts that drive

shoppers passed merchandise they need The consumers’ ongoing love-hate
shopping at IKEA.
and items they didn’t know they wanted. relationship with IKEA did not cool last year,
Navigating the layout, and kvetching every but it assumed a lower priority, at least
step of the way, is part of a repertoire of temporarily. Sooner rather than later the
IKEA shopping rituals that defines the brand chain is likely to benefit from a lot of pent-
and sets it apart from any other retailer. up demand.
At a glance
$5.7 billion
It was challenging to be the world’s Brand Value 5%
ange YOY% -1
largest home furnishing retailer Brand Value Ch
Sales $29.9 billion
Total Company
during a global economic crisis Total Company
Stores 309
$29.9 billion
precipitated by risky mortgage IKEA Brand Sale
s
309
products that produced record IKEA Brand Stor
es
38
eration
foreclosures and steep drops in the Countries of Op and ikea.com.
This high-traffic IKEA is loca include IKEA
ted in Croydon, a UK shoppin IKEA brand sales wn Optimor
tail, Millward Bro
sale of new and existing homes. destination south of London
.
g
Sourc es : Ka nta r Re
The brand declined in value.

IKEA’s 300-
the same in all of
plays look much
Because customers weren’t visiting the Merch an dis e an d dis
ing this one in We
stcheste r, Oh io.
plus stores, includ
stores to buy furniture, they were not
patronizing IKEA’s restaurants. That
axiomatic point is important because, outside the checkout area actually turn
with over 300 IKEA stores in 38 countries, substantial profit.
those Swedish meatballs add up quickly, insights & implications
making IKEA one of the world’s largest In more normal times, IKEA prospered
• Although IKEA has a few imitators, its combination of affordability, family-friendly store experience and
restaurant chains. in Europe, the US, and from growth in global scale make it unique and relatively protected from direct competition.
former Soviet countries. And its global
• The business model relies on getting households into the store to experience IKEA and then motivating
The in-store restaurants, with low-priced reach protected the company from regional return visits. The company has an opportunity to expand further into traffic-driving categories like food
menu items and a place to sit, relax and fluctuations. Last year it could find no or housewares.
contemplate potential purchases, reinforce shelter. There was little IKEA could do • E-commerce will need to become a bigger apart of the IKEA offer.
the brand’s value proposition. The fast food aside from closing a few underperforming
and Swedish delicacy kiosks located just locations. The company also made
ThE TOP 20
13. MARKS & specialists like Zara, H&M, New Look,

Next and Primark offering “fast fashion” at
affordable prices. M&S felt pressure from
international presence, which included
another 245 stores in 27 countries. The
competitive challenge is in some ways
SPENCER
its department store competitors as well, tougher outside the UK, where three
such as John Lewis, which is owned by quarters of annual turnover depends
the same company as Waitrose. M&S has on non-food and the M&S brand is not
experimented with the premium end of regarded as a national institution.
men’s and women’s mid-market apparel.
The efforts highlighted the challenge of Still, M&S remains an enormously profitable
The Marks & Spencer brand

selling both food and non-food. When the business with a remarkably strong
company correctly identifies and promotes brand that may benefit from the recent
youthful fashion trends in apparel, it risks appointment of a new CEO who
proved more resilient than losing its core food customer. ran Morrison’s, the fourth largest and
fastest-growing UK supermarket.
the M&S business last year. Given these challenges in its home market,
where M&S operated 684 stores in 2009,
the company also looked to increase its
A British heritage brand established

in 1884, Marks & Spencer is one of At a glance
world’s iconic retailers. That stature
$5.6 billion
didn’t protect the organization from Brand Value
-5%
ange YOY%
the recession. But it mitigated the Brand Value Ch
Sales $15.0 billion
Total Company
consequences somewhat, at least Stores 929
Total Company
Brand Sales
in the UK. MARKS & SPEN
CER
$15.0 billion
CER Brand Stores
Just over half of the company’s annual MARKS & SPEN 929
turnover in the UK comes from food, which M&S emphasizes its private
labels, like Autograph, but
eration 27
Countries of Op
increasingly includes nationa
l brands in its merchandis encer and
M&S sells in its department stores and e mix.
r brand sales inc
lude Marks & Sp
Marks & Spence
in the Simply Food convenience outlets company’s annual
tur nover in the UK marksandspencer.
com.
wn Optimor
Just over half of the r Re tail, Millward Bro
that it operates in the UK and Ireland. As Sources: Kanta
comes from food.
consumers shifted spending from wants an up-market grocery serving a similar
to needs, food was not a bad place to be, customer, M&S last year accelerated the
although because of its many high street introduction of national brands. Meanwhile,
locations, M&S sales were impacted by the as merchants competed for share of
decline in office workers. reduced consumer spending on food,
the market became more promotional, an insights & implications
Along with the spending slowdown, M&S attitude that didn’t quite match the upscale
• M&S’s food business faces intensified competition as Waitrose expands across the UK and moves into
faced two other challenges to its food positioning of M&S. the convenience sector.
business: a more promotional market
• Closer alignment between the apparel and food sides of the business could result in a more productive
and tougher competition. Until recently, a The recession also intensified the store where the somewhat younger shoppers who may stop at M&S for lunch might shop there for
food range respected for its quality and company’s struggle in non-food in the apparel.
innovation enabled M&S to offer exclusively UK, where the M&S brand, known for • E-commerce threatens to take a larger share of M&S’s apparel sales.
own-label food items. To compete more quality apparel basics, struggled to remain
effectively, particularly against Waitrose, relevant in a market crowded with apparel
ThE TOP 20
14. ASDA merchandise sold. The George brand, an

affordable fashion initiative introduced in
1999, drives that success.
ASDA operates the largest food stores

The scale of the ASDA stores draws
customers for bulk shopping trips, but
the inconvenience of the large format
combined with the relative lack of locations
make ASDA less successful at capturing
in the UK, but not enough of them. With fill-in trips. ASDA also is somewhat behind
ASDA declined somewhat in brand less than 400 stores, and three formats,
the chain suffers from having fewer
grocery competitors in developing an online
presence. But it is improving rapidly.
value last year. locations than competitors like Tesco, the

market leader, which operates more than
2,000 stores in the UK alone. ASDA also
competes heavily against Costco, the
warehouse club, and food deep discounters
ALDI and Lidl.
At a glance
$4.9 billion
Brand Value -9%
nge YOY%
l C om pa ny Sa les
Tota 371
Stores
D A Br an d Sa les
AS 371
es
ASDA Brand Stor 1
ration
Countries of Ope m. helped ASDA .
become the
UK’s
Viewed as a price leader in food, Asda brand sales

and as da
include Asda
.co
wn Optimor The Geo rg e br an d
rel retailer in
units sold
es : Ka nta r largest appa
the brand operates only in the UK, So urc
including Northern Ireland, and

it’s the second largest UK retailer The “rollback” pri
cing borrows a pro
by turnover. parent Walmart. motion tactic of cor
porate
Ironically, the strength of the brand as a

destination grocery merchant perhaps is
best demonstrated by its performance Walmart has adopted practices learned
in the Republic of Ireland where ASDA from ASDA, including the chain’s superior
operates no stores but receives almost house keeping standards and its success
10 percent of grocery spending. merchandising apparel. ASDA sales have insights & implications
contributed substantially to the growth of
• To sustain its strong market position in the UK, ASDA needs to develop a viable convenience format
This unusual phenomenon results because Walmart’s international business of $100 and supply chain.
of crowds from the Republic of Ireland billion or about 25 percent of total
• ASDA must continue to strengthen its online presence.
shopping at a massive ASDA store located corporate turnover.
on the northern side of the border. Their • With the departure of its CEO, in early 2010, organizing a smooth transition of ASDA senior
management becomes a top priority.
patronage makes that store Number 1 in Although 70 percent of ASDA sales are
the world, by sales per square foot, for derived from food, the brand is the UK’s
Walmart, which acquired ASDA in 1999. leading apparel retailer by units of
ThE TOP 20
15. KOhL’S broad assortment at competitive prices.

It’s particularly well known for its range of
lingerie basics that women replace regularly.
The chain continued to be intensely

customers visited the stores. Kohl’s online
revenue was up almost by 40 percent year-
to-year in 2009, following a 48 percent
increase in 2008.
promotional in its stores, advertising and For an apparel-focused chain, these

Despite the tough economy, the circulars. As competitors became more
promotional, these tactics were business-
accomplishments were especially
significant in a year when most consumers
brand value of Kohl’s increased by as-usual for Kohl’s. And customers may
have felt emotionally closer to Kohl’s during
dramatically reduced spending on the
category and the measure of success for
12 percent last year.

the recession. They relied on the brand to retailers was not about winning the most
deliver on its price and discounting promise, but about losing the least.
and it did.
The traffic-driving merchandise strategy

and promotional pricing led to a high level
of trips completed without the need shop
the competition for fill-in items. And not all
At a glance
$4.3 billion
Brand Value 12%
ange YOY% +
Brand Value Ch
Sales $17.1 billion
Total Company
Stores 1,058
Total Company 7.1 billion
and Sales $1
HOME DEPOT Br 8
and Stores 1,05
HOME DEPOT Br
eration 1
The US discount department store Countries of Op d kohls.com.
include Kohl’s an
Kohl’s brand sales wn Optimor
tail, Millward Bro
chain benefited from its unique Sources : Ka nta r Re
operating model. Unlike most of ny dr aw s women sh

oppers with
licensed
The com pa g.
as Vera Wan
America’s department stores, Kohl’s designer br
ands, such
centralizes supply and distribution. Kohl’s usually locate

locations near ma
s its department sto
jor malls.
res in free-standin
g
During the economic downturn,
these efficiencies and superior
inventory control enabled Kohl’s to gaps, and a relatively strong balance sheet
experiment with apparel trends and insights & implications
enabled Kohl’s to acquire these licenses.
• Kohl’s has a major opportunity to capture market share from less efficient retailers. Similarly, its
find the sweet spot faster than expansion may benefit from real estate that becomes available if and when weaker retail brands exit
the competition. Unlike the many apparel retailers hurt when the business.
parents trimmed teenager allowances,
• The challenge for Kohl’s is to efficiently scale a complicated business model, which depends on
Kohl’s licensed and launched the Mudd the Kohl’s core customer is “mom.” She putting many items on promotion and changing prices in every store almost everyday.
brand for young girls and enjoyed success views Kohl’s as reliable and convenient
• Although Kohl’s is an excellent operator, the daily churn of business sometimes takes its toll on
with the Hang Ten brand for young boys. To because the chain offers a broad selection housekeeping standards. In a recovering economy, some shoppers may prefer to purchase apparel
reach women shoppers, Kohl’s licensed the of both fashion and basic items. Kohl’s in a more disciplined store environment, even it means paying more.
Dana Buchman brand from Liz Claiborne. has turned apparel into a traffic driver by
Kohl’s embraced these brands to fill market featuring some national brands along with
ThE TOP 20
16. LiDL several hundred national brands, Lidl

positioned the brand as a traditional but
less expensive supermarket for completing
most shopping. Establishment of the
European Union and the absence of tariffs
off some debt incurred during its period
of rapid growth. And while expansion
opportunities exist in Europe, they’re more
limited as the continent becomes more
heavily stored. Expansion outside of Europe
facilitated Lidl’s cross-border expansion is compelling but difficult because the
Lidl is closer than any other and propagation of the deep discount
grocery concept. Growth remained organic
Lidl system is set up for the EU. For now,
Lidl is looking in places like Cyprus and
retailer to being a pan-European until Lidl acquired the German-based

Plus chain in Bulgaria and Rumania,
Malta, small corners of Europe that remain
generally underserved and where ALDI is
grocery brand.
in early 2010. not present.
Lidl slowed its expansion somewhat for

financial and strategic reasons. It’s paying
At a glance
$4.1 billion
In good times that’s a powerful Brand Value %
ange YOY% -1
Brand Value Ch
position. Last year, with the Total Company
Sales $53.0 billion
continent in recession, having stores Stores 8,772
Total Company
$53.0 billion
in over 20 European countries LIDL’S Brand Sa
les
8,772
ores
seemed less desirable, especially LIDL’S Brand St
eration 23
Countries of Op
since the company operates its Lidl drives traffic with price
and a limited assortment that Lidl brand sales
cery stores.
include the Lidl gro
wn Optimor
wide enough to complete ’s Retail, Millward Bro
almost 9,000 stores exclusively most shopping trips. Sources : Ka nta r
in Europe.
of
t the EU with stores
erates throughou
Despite the economic pressure and the The company op UK .
h as this one in the
modest size, suc
limitations of its geography, the Lidl brand
remained roughly even in value last year,
probably because its core proposition – products for every country from the German
food at a cheap price – resonated among buying office. While the stores initially
a wider group of shoppers concerned reflected the German tastes of the buyers, insights & implications
about making ends meet. the range has become more international as
• Lidl’s discount grocery brand proposition positions the company well for serving cautious, value-
it’s been informed by local knowledge. seeking post-recession consumers.
And unlike some other retailers, Lidl has • The company’s success in quickly saturating the EU suggests that it will pursue another surge of store
only one brand, which it reinforces on every Central control also enabled Lidl to expand growth once the current expansion is digested.
store fascia and with aggressive marketing. rapidly after the launch of its current
• Future growth will require expansion to countries and regions outside the EU and beyond Lidl’s existing
That single-minded approach evinces format, 35 years ago, to challenge ALDI.
infrastructure, which adds complexity.
the company’s centralized approach to By carrying about 2,000 items, more that
operations, which includes purchasing most double the ALDI range, and including
ThE TOP 20
17. COSTCO But on the plus side, because Costco drove

more trips, it was able to take some share
from its food competition. Having Costco
brand gas stations to drive traffic, literally, at
many locations didn’t hurt.
Costco also increased the range in health
and wellness to serve a core of older
customers who had depended on Costco
to fill their pantries and closets during child
raising years. Today, the median age of a
Costco member is over 50, and for many of
Costco felt the impact of the The company launched several new
initiatives. It emphasized a monthly coupon
those members Costco has become a sort
of “empty-nester treat shop.”
recession last year because of the program with a direct mail campaign to
members to drive value and trips. While The chain was somewhat helped by its
vicissitudes of its geography and

sales and promotions cut against the international business, which includes eight
club philosophy of controlling costs and countries and almost 20 percent of its
margins, the coupon books generated roughly 560 stores. Costco opened its first
business model. some excitement. store in Australia last year.
At a glance
$3.8 billion
Brand Value -26%
nge YOY%
The Seattle-based chain operates Brand Value Cha $72.8 billion
l C om pa ny Sa les
Tota
a large proportion of its stores on Total Company
Stores
559 Shoppers find bulk
stacks of both ess
entials and treasu
$72.8 billion
items at the wareh re hunt
ouse club.
the West Coast, with 28 percent of CO ST C O Br an d Sa les
Stores 559
its US sales coming from California, COSTCO Brand 9 Costco
ration roughly 560
which was hard hit economically. Countries of Ope stc o.c om , costco.ca, um bu s, O hio, is one of .
o, co
les include Costc This store in
Col countries
Costco brand sa eight other
the US and
Customers in these markets and Co stc o
Ka
Bu
nta
sin
r
ess Center.
Re tail, Millward Bro
wn Optimor
locations in
Sourc es :
especially sought to fill needs
more than wants. And they were
determined to spend as little as
possible to fill those needs.
As a membership warehouse, Costco When the Costco system works, which insights & implications
operates on a thin 10.5 percent gross is most always, Costco is an unparalleled
• As the economy recovers, Costco will be able to introduce more aspirational products at higher price
margin, which leaves little room for price item velocity merchant. Costco gains a points. While margins will remain thin, the higher price points will yield greater sales volume and profit.
changes on existing merchandise. Lowering high share of wallet from its best members.
• The company has plenty of expansion room both in North America and globally, building on a presence
prices requires changing the merchandise The problem occurs when members are in the UK, Japan and other markets, such as Australia where it opened its first store last year.
mix. That takes time. Customers didn’t destabilized, like last year. Shopping trips
• With most of its US stores located on the west and east coasts, Costco will increasingly compete
abandon Costco. It’s a club and shoppers were up but the average basket declined – head-to-head with Walmart as it fills in the middle of the country.
are loyal. They spent less, however, which primarily because members traded down
was a problem. on aspirational merchandise.
ThE TOP 20
18. SAM’S CLUB wide range of annual sales. Its highest

producing stores gain about $120,000 in
annual sales, about eight times the volume
of its least productive stores. In contrast,
Costco stores operate within a narrower
fluency with shopper research, the initiative
may actually outstrip Walmart’s capabilities
and it exceeds Costco’s efforts. It also
potentially provides a cost-effective way for
Sam’s to shape its merchandise range for
range. Its highest and lowest performing local tastes while accruing the economies of
The Sam’s Club brand value stores differ by a multiple of three. scale of central buying.
softened slightly last year. At the same time, Sam’s is segmenting its
membership to target higher-spending Elite
Emerging from the recession, many
consumers may feel cautious, materially
members with special offers. The program sated and perhaps less inclined spend
is part of a wider effort to more aggressively hundreds of dollars per trip at a warehouse
mine shopper transactional data from club. They will continue to seek value on
the Sam’s loyalty card to target member basic items and the occasional reward, and
communication and refine the product Sam’s is well positioned to capitalize on this
offering. While indicative of Walmart’s shopper mindset.
At a glance
$3.2 billion
Brand Value %
ange YOY% -7
Brand Value Ch
Sales $47.6 billion
Total Company
Stores 596
Total Company
and Sales $47.6 billion
SAM’S CLUB Br
and Stores 596
SAM’S CLUB Br
eration 1
Countries of Op stco, co stc o.com, costco.c
a,
es include Co
Costco brand sal
But Sam’s warehouse club pricing an d Co stc o Bu sin ess Center.
wn Optimor
Ka nta r Retail, Millward Bro
credentials, and its strong offer in So urc es :
food and other basics, buffered the

brand somewhat from the full brute
force of the recession. Arkansas,
Bentonville, rent.
m ’s Cl ub is located in ar t, its corporate pa
This Sa alm
The sales volumes te rs of th e chain and W
At the same time, recessionary pressure at Sam’s Club sto headquar
To differentiate the Sam’s brand, the at about $120,000
annually.
res vary widely, top
ping out
revealed the brand’s fundamental company is implementing a strategic store
challenge—the need to differentiate. As refurbishment program, not unlike the
consumers sought the best value for Walmart’s Project Impact. By reducing
everyday essentials, the choice often was clutter and making the in-store environment insights & implications
not between Sam’s and its warehouse club more appealing, Sam’s hopes to reduce
• Sam’s needs to establish legitimate differentiation from Walmart with which it shares significant
rival Costco, but between Sam’s and other distractions and make the product the hero. shopper overlap.
grocers, including its fiercely competitive
• The brand has a major opportunity to leverage its considerable member insight information to
corporate parent, Walmart. To tackle this challenge, Sam’s installed more precisely target communication and assortment.
a new CEO, in March 2010, with a
• Improvements to the store shopping experience also should help strengthen the bond with
Geography and a merchandising focus on background in food retailing and consumer the customer.
essentials rather than treasure hunt items, goods marketing. He will contend with
insulate Sam’s from Costco somewhat, but another lingering challenge—the need to
expose it directly to Walmart, with which prune Sam’s sites and optimize inventory.
it often shares locations and shoppers. The Sam’s warehouse stores produce a
ThE TOP 20
19. SAFEWAY the company is taking steps to grow share

of wallet from this narrow group of existing
and potential customers.
These steps include: refining its loyalty card

Safeway also is differentiating itself with a
focus on health and wellness. The company
engages shoppers about the healthiness
of the food they consume. On the Safeway
Web site, for example, loyalty cardholders
program; developing a private label program can review their purchases for calorie count
Safeway may have made the right in organic food, called O Organics; and
selling O Organics to other food merchants
and receive recommendations for reducing it.
moves at the wrong time last year. in the US and globally through a Safeway
subsidiary company.
Prior to the downturn, the

US grocery chain finished its At a glance
$3.1 billion
Lifestyle prototype rollout, which Brand Value %
ange YOY% -8
is aimed at shoppers interested in Brand Value Ch
Sales $40.0 billion
Total Company
trading up in food and exploring a Total Company
Stores 1,724
more premium offer. Brand value d Sales $26.5 billion
SAFEWAY Bran
1,159
declined somewhat. SAFEWAY Bran
d Stores
2 th e western US
, Safeway sh
ve
ould
rs.
eration io ne d in on re co
Countries of Op ay supermarkets
but not other Well posit
the econom
y of that regi
es include Safew l, Millward prosper as
The chain remodelled its Safeway stores Safeway brand sal es: Kantar Retai
wit h dif fer ent names. Sourc Safeway believes
that its expanded
holdings food will help gain focus on health and
to emphasize perishables and reduce Brown Optimor greater share of wa organic
llet from its core cus
tomers.
dry groceries. As the premium customer
became thriftier, Safeway lost share to
lower-priced, need-based competitors.
The impact of inopportune timing was
compounded by difficult geography. More
than one-third of Safeway’s selling space
is located in California, one of the states spending but will prefer offerings that are insights & implications
hardest hit by the recession. more personalized. Plus, Safeway is the
• As the California economy recovers, and consumers consider purchasing premium items, Safeway’s
historic grocer of choice west of the Rocky business should strengthen.
It was as if the chain had put up a giant Mountains, with dominant market share in
• Safeway will continue to build share of wallet from its most profitable shoppers by leveraging loyalty
sail and the wind died. As the wind many metro areas. card and e-commerce information to create targeted offers.
picks up, however, both strategy and
• As Safeway moves into the more premium sector of the grocery business, it becomes more
geography could be strong assets. The To get its fair share of the recovery, Safeway
insulated from price-driven competition but faces strong up-market competitors.
chain’s focus on a narrow but vital group of will need to win back customers lured away
customers, rather than a mass audience, to the competition and reengage them with
is consistent with the sensibilities of post- the brand. Rather than focus on the mass
recession consumers who will resume market and attempt to grow market share,
ThE TOP 20
20. SAiNSBURY'S If not integrated into the brand proposition,

the price-driven tactics potentially threaten
to erode an upmarket heritage. And they
may not be enough to secure a sustainable
market position for Sainsbury, whose
Sainsbury's has proved that it can fix
problems. Its in-stock position is much
improved from a few years ago, for
example, when supply chain problems
resulted in excessive out-of-stocks.
offering is considered just above Tesco in The company also has more aggressively
The value of the Sainsbury's shopper perception and just below Marks
& Spencer and Waitrose.
expanded its online business during
the past several of years.
brand dipped only slightly during

the recession.
At a glance
$2.7 billion
Brand Value %
ange YOY% -4
Brand Value Ch 0.9 billion
Sales $3
stomers Total Company
aign that helped cu Stores 859
ily for a fiver” camp ons. Total Company
The “Feed your fam mo ted me al sol uti
$30.9 billion
recession also pro and Sales
manage during the
SAINSBURYS Br 9
While the UK brand trades close SAINSBURYS Br
and Stores 85
eration 1
to the upmarket end of traditional Countries of Op
grocers, it responded early and sales include Sa
insbury and sains
bury.com
Sainsbury brand wn Op tim or
promotionally to the slow down Sources: Kantar
in spending even among its core The Sainsbury Sydenham

store in the UK offers a broa
assortment of both food and d
non-food merchandise.
shoppers. Clever marketing like
“Feed your family for a ‘fiver,’”
captured the mood of the nation and
drew shoppers from the competition.
insights & implications
Sainsbury's also ventured into non-food,
• Sainsbury’s need for a stronger convenience store presence becomes even more imperative as
adding a mix of margin and impulse items, The merchandising and the promotional Waitrose aggressively adds stores.
such as entertainment and video games, to activity proved to be successful responses
• Tactical promotions, which helped Sainsbury weather the recession, need to be sustained and
some of its larger stores. The chain of 534 to an immediate problem, the recession,
integrated into its brand proposition.
supermarkets and 325 convenience stores and an untenable reality—50 percent of
• It is not clear whether Sainsbury management believes that the best way to maximize shareholder
hopes to grow the non-food part of its Sainsbury's shoppers also visit Tesco.
value is to build the brand or to sell it. But the urgency of the question increases as debt costs fall.
supermarket mix to about 5-to-10 percent These incremental moves enabled growth
of total sales. by somewhat blurring the Sainsbury brand.
The Top 20 Most Valuable Global Retail Brands 2010
# Company/ Brand Value Brand Sector(s) Total Corp. Sales Total Corp. Stores Brand Sales Brand Stores Country
home Country Value Markets
Change
YOY
1. US $39,421,000,000 -4% Discount $406,420,425,761 8,051 $294,656,926,728 4,577 15
2. US $27,459,000,000 +29% Online $24,509,000,000 0 $23,556,652,474 0 7
3. UK $25,741,000,000 +12% Food $89,742,099,511 4,768 $77,331,772,473 3,396 15
4. , France $14,980,000,000 0% Hypermarket, Other $131,595,035,573 14,299 $98,935,192,557 3,489 41
5. US $12,148,000,000 -1% Discount $63,435,000,000 1,740 $63,435,000,000 1,740 1
6. US $9,328,000,000 -28% Online Auction $57,206,000,000 0 $30,319,180,000 0 39
7. US $8,971,000,000 -3% Home Improvement $65,906,929,397 2,244 $65,906,929,397 2,244 7
8. Germany $8,747,000,000 1% Hard Discount Food $65,876,476,921 9,396 $59,211,435,002 8,957 20
9. France $7,848,000,000 -26% Hypermarket, Other $63,265,135,037 2,624 $37,147,816,243 323 13
10. US $7,008,000,000 +10% Home Improvement $47,207,073,792 1,709 $47,207,073,792 1,709 2
11. US $5,807,000,000 +18% Home Electronics $48,821,391,535 4,037 $38,510,436,791 1,222 14
12. Sweden $5,710,000,000 -15% Home Furnishing $29,957,818,134 309 $29,957,818,134 309 38
13. UK $5,699,000,000 -5% Department Store, Food $15,081,753,582 929 $15,081,753,582 929 27
14. UK $4,922,000,000 -9% Discount, Food $29,958,557,695 371 $29,958,557,695 371 1
15. US $4,371,000,000 +12% Department Store $17,178,000,000 1,058 $17,178,000,000 1,058 1
16. Germany $4,102,000,000 -1% Hard Discount Food $53,079,853,088 9,736 $53,079,853,088 8,772 23
17. US $3,875,000,000 -26% Warehouse Club $72,843,092,770 559 $72,843,092,770 559 9
18. Sam’s Club, US $3,255,000,000 -7% Warehouse Club $47,605,497,314 596 $47,605,497,314 596 1
19. US $3,173,000,000 -8% Food $40,062,671,355 1,724 $26,552,665,159 1,159 2
20. UK $2,728,000,000 -4% Food $30,981,119,982 859 $30,981,119,982 859 1
Sources: Kantar Retail, Millward Brown Optimor. See the At a glance charts for brand footnotes.
COMMENTARY
the imagination. Visits have been made to
other sites where equivalent plant has been
installed – to the complete satisfaction of
the operators. The suppliers’ calculations of
expected ROI have been double-checked
Why a Ruritanian Poltergeist by Jeremy Bullmore

and audited: the predicted payback is
mouth-watering. Unless this programme
is fully funded, competitive pricing of the
can be as valuable as an company’s goods may soon become
impossible.
Automated Processing Plant We’re in the boardroom of a The Production Director’s case is a
First published in the WPP Annual Report company that makes fast- sturdy one: proposed investment at its
most responsible, with deeply reassuring
moving consumer goods. numbers attached to every item. Like
At the heart of today’s agenda the assets it’s designed to protect and
enhance, it’s wonderfully tangible: it’s
is budget allocation for the concrete. And so is the language in which
forthcoming year. The two the recommendation is framed.
most prominent supplicants
The Marketing Director is responsible for
are the Production Director the company’s brands. On the company’s
and the Marketing Director. balance sheet, they are categorised as
intangibles. Marketing budgets have
The Production Director has a meticulously- traditionally been decided on the basis
prepared case for an increase in capital of last-year-plus-a-little. The Marketing
expenditure. A concerning proportion of Director’s most high-profile recent campaign
the company’s manufacturing capacity is aimed at teenagers and features a
is obsolescent. Working together, Ruritanian poltergeist who wears a kilt
Production and Procurement have put and is called Feliks. Although there’s
their requirements out for tender and have evidence to suggest that this campaign is
interrogated the competitive proposals greatly appreciated by its target audience,
within an inch of their lives. They are and sales are indeed buoyant, not every
wholly satisfied that they’ve got the most member of the Board fully appreciates
cost-effective deal. Full-colour plans and Feliks nor is familiar with the largely digital
scale models are on display to augment media on which he features.

COMMENTARY
When compared with a new robotic Throughout their report, the Deutsche Their analysis of over 30 large European the maintenance and enhancement of those
processing plant, a kilt-wearing Ruritanian Bank team use ‘A&P’ as shorthand for this and US consumer staples companies over assets has no commonly agreed name.
poltergeist doesn’t intuitively strike them as investment. more than 15 years shows “that companies Among the 30 companies scrutinised,
being as deserving a recipient of precious, that increase A&P to sales ratios deliver Deutsche Bank identified 10 slightly different
finite funds. Here are three of their conclusions. sales growth 30% faster than those who do terms for A&P expenditure. The precise
not.” And while it’s self-evident that cutting composition of different companies’ A&P
The Marketing Director makes an excellent “Brands are critical in consumer marketing spend delivers an immediate expenditures also varies widely – and in
case. He doesn’t resort to jargon, sensibly staples. Intangible assets account cost benefit, “companies that increase A&P several instances, their expenditures are not
plays down the creative awards that deliver profit growth faster than those that disclosed at all.
Feliks has accumulated and musters
for more than 100% of the market
cut A&P.” They add the chilling comment:
an impressive array of research that value of the consumer staples sector To attempt to compare the relative values
demonstrates a strong correlation between reflecting the power of brands built “Losing market share can be quite a of Capex and A&P would be as pointless as
levels of marketing spend and his brand’s up over many decades. Indeed, profitable experience – it is the cost attempting to determine which is the more
market share and profit contribution. The just as Capex protects the tangible important wheel on a bicycle. To be unable
Board listens attentively to his presentation
of stabilising and rebuilding a brand to make what you sell is neither better nor
assets, advertising and promotional that is expensive.”
and asks intelligent questions. But as the worse than being unable to sell what you
Chairman puts it in summary: times are
spend builds and protects the value make. But because of their uniquely elusive
tough, and there’s universal agreement that of consumer brands.” What the Deutsche Bank note does, among quality, the value of brands – rather more
costs must be contained. So on balance, many useful things, is to remind us of the than the value of machinery – badly needs
with economic conditions being what “The importance of A&P is not remarkable differences in vocabulary, in the periodic championing; and so, it follows,
they are, and with the brand’s momentum well understood. A&P spend is the use of language, that are employed when does the importance of A&P.
looking gratifyingly healthy, rather than the we talk about a company’s different assets.
second largest cost for the staples
suggested increase, perhaps some modest industry and critical to the health of Mere products may have life cycles – and
reduction in promotional support would be A company’s tangible assets are exactly tangible assets certainly do. But if nurtured
the more responsible course of action at
brands and thus valuation. However, that. They’re tangible. The money that is and nourished by its A&P, a brand can
this moment in time. financial disclosure of these items commonly agreed to be necessary for the be forever.
is generally poor and 73% of maintenance and enhancement of those
At the end of the Board Meeting, the respondents in our investor survey assets has a commonly agreed name: It seems somehow appropriate that
Marketing Director is not as happy an capital expenditure, or Capex. A public the only company asset capable of
said that they did not have a good company’s Capex is necessarily disclosed.
executive as the Production Director. returning a profit for all eternity should
idea of how the industry spends its
be called an intangible.
marketing budget.” A company’s brands, perhaps representing
more than 100% of its market value, are Jeremy Bullmore is a member of the
The above cameo, of course, is fiction. “Actions in recession key to called intangibles. Synonyms for intangible WPP Advisory Board.
But it was prompted by a remarkable shape of recovery. Our analysis include insubstantial, elusive, vague,
ethereal and indefinable. The money that *European Consumer Staples: The Importance
investors’ note issued by the Consumer shows that companies who continue of A&P, 15 January 2010. Deutsche Bank AG,
Staples Research team from Deutsche every company knows to be necessary for
to invest, grow faster, and we can Consumer Staples Research team. Extracts
Bank, Europe, in January 2010*. Its stated from Deutsche Bank note reproduced with
purpose was to analyse “the effect of
see clear trends in terms of A&P kind permission.
advertising and promotional investment on investment during the downturn. The
the consumer staples sector, its impact on actions of companies through the
profit growth rates and the likely shape of recession have diverged significantly
profit recovery coming out of the recession.” and it is those actions that we
believe will drive the trajectory of
subsequent profit recovery.”
10 KEY
4 Retailing will be about much more 8 Developing markets provide
than the transaction between buyer tremendous opportunity for retail
and seller. The best retailers will brands to cultivate extremely loyal
leverage the unique bond of trust shoppers who view successful
TAKEAWAYS
with their shoppers to become more retailers not simply as suppliers of
important in other aspects of the lives merchandise, but also as agents of
of their shoppers—financial services, economic transformation helping to
healthcare and entertainment are improve local life. China, for instance,
good examples. has some of the highest retailer
bonding scores of any market in the
5 Mobile commerce will be a game world.
changer in how, when and where

people purchase products, in the 9 This slow-growth era still requires
same way that the Web dramatically
altered the way people research long-term vision to build and sustain
products before purchasing. retail brand equity. But sustaining
M-Commerce potentially will change that vision becomes more difficult,
the store experience, if not the very as many retailers, particularly
nature of the store and retailing itself. in continental Europe, painfully
recognize. While cost cutting can be
necessary and appropriate, short-
6 Retail brands need to think outside term gains need to be understood
against the fundamentally important
the box. Literally. Brands must be investment in brand equity.
active participants in the digital
conversations that surround
1 Value remains critical. But it’s not 3 The battle for shopping trips will purchases. Or they risk becoming 10 Retailers with business models that
irrelevant and disintermediated as
enough. Brands that combined drive competitive strategy coming enable them to thrive on slim profit
shoppers find product information,
value with a more emotion-based out of the recession. Retailers will margins will continue to disrupt the
product reviews, pricing and
connection to consumers did well fight to keep shopping trips gained market with often unbeatable prices.
purchasing options without going near
last year. That ability will continue during the downturn (by keeping the These retailers have an opportunity
a physical store.
to be the key to engaging post- shopper from going back to the outlet to leverage that value—with smart
recession shoppers. they abandoned). And they’ll fight to merchandising, marketing and
regain shopping trips (by stealing their customer understanding—into a
7 Best-in-class retailers will maximize
shopper back from another outlet or broad and intense connection
2 Successful retail brands increasingly another activity). share of wallet from their most with shoppers.
profitable shoppers to expand their
will be built on intimate knowledge
business in today’s slow-growth
of shopping behavior. Retailers
environment. Category conversion
that invest in this capability most
(getting shoppers to buy more of the
aggressively are the ones mostly likely
assortment) may replace category
to continue to thrive. Retailers that
growth (adding more skus) as the
ignore these insights will struggle.
lingua franca of supplier-retailer
partnerships.

METhODOLOGY how Brand Value is Financial Performance
Financial data is sourced from Bloomberg,
Calculated analyst reports, Datamonitor™ industry
reports, and company filings with regulatory
Millward Brown Optimor applies an
bodies. A team of Millward Brown Optimor
The brand value published is based

economic use approach to brand valuation,
analysts then prepares financial models for
using a methodology similar to that
each brand that link brand perceptions to
employed by analysts and accountants.
on the intrinsic value of the brand –
company revenues, earnings, and ultimately
The brand value published is based on the
shareholder and brand value.
intrinsic value of the brand – derived from its
derived from its ability to generate ability to generate demand. The dollar value
of each brand in the ranking is the sum of The Valuation Process
demand.
all future earnings that brand is forecast
to generate, discounted to a present-day The brand value is calculated in three steps:
value. Given the high volatility of financial
markets over the past 12 months, the Branded Earnings
brand value is in some cases high relative to What proportion of a company’s earnings is
current market capitalization, reflecting true generated “under the banner of the brand”?
value rather than current market swings.
First, we identify the portion of total
company earnings generated by each
The Data Sources business that carries the brand. For
example, in the case of Coca-Cola, some
Brand Equity
earnings are not branded Coca-Cola, but
Insights into customer behavior and brand come from Fanta, Sprite, or Minute Maid.
perceptions come from WPP’s BrandZ, an From these branded earnings, we subtract
annual quantitative brand equity study in capital charges. This ensures that we only
which consumers and business customers capture value above and beyond what
familiar with a category evaluate brands. investors would require any investment in
Since the inception of BrandZ 12 years ago, the brand to earn — the value the brand
over one million consumers and business- adds to the business. This provides a
to-business customers across more than bottom-up view of the earnings of the
30 countries have shared their opinions branded business.
about thousands of brands. It is the most
comprehensive, global, and consistent
study of brand equity.

METhODOLOGY
Corporate
Brand Contribution cars, or beer, brand is particularly important. Earnings
‘Branded’
How much of these branded earnings are Over the past five years, the importance Earnings
$ ‘Branded’
generated due to the brand’s close bond
with its customers?
of brand has risen. Brand Contribution is
calculated as a percentage, but displayed Brand
Brand $
Intangible
Earnings
x % x M
as an index from 1 to 5 (5 being the highest). Value =
Value $
Only a portion of these earnings can be
considered as driven by brand equity. This Brand Multiple
Step 1. Step 2. Step 3.
is the “Brand Contribution,” the measure What is the growth potential of the brand- Intangible Earnings Brand Contribution Brand Multiple
that describes the degree to which brand driven earnings? Intangible corporate earnings Portion of intangible Brand earnings multiple.
allocated to each brand earnings attributable
plays a role in generating earnings. This by country, based on to brand.
Calculated based on
market valuations, brand
is established through analysis of country, In the final step, the growth potential company and analyst reports, Directly driven by growth potential and
market, and brand-specific customer of these branded earnings is taken into industry studies, revenue BrandDynamics™ Loyalty Voltage™ as measured
estimates, etc Pyramid and Category by BrandDynamics™
research from the BrandZ database. account. Both financial projections and Segmentation collected
consumer data are used. This provides an within the BrandZ study
This guarantees that the Brand Contribution earnings multiple aligned with the methods Data Sources Data Sources Data Sources
is rooted in real-life customer perceptions used by the analyst community. It also
and behavior, not spurious “expert opinion.” takes into account brand-specific growth
The Brand Contribution allows us to capture opportunities and barriers.
differences in the importance of brands by
category and by country, the role of brand The Brand Momentum™ metric that
versus other factors such as price and indicates each brand’s growth is based
location, and changing customer priorities. on this evaluation. It is presented as an
In some categories, such as luxury goods, indexed figure that ranges from 1 to 10
(10 being the highest).

ABOUT
The extensive knowledge presented in spend investment analysis and go-to-
this report can be reduced to a single market strategy.
conclusion: Past performance won’t assure
• Activation: We provide the designs and
KANTAR
future success. Success requires an
integrated understanding of the business tools required to implement new or
from insight through strategy and activation. revised strategies. Our broad offering
That’s the broad perspective Kantar includes retail content and skills-
Retail provides and why we are uniquely based training along with coaching and
RETAiL
qualified to help businesses serving today’s eLearning. These proven implementation
complicated retail industry. products and services assure that
creative thought is quickly converted
We offer the combined experience and into profitable action.
capabilities of four companies renowned
for their leadership in retail insight and Our focus on pragmatic results helps clients
consultancy: Cannondale, Glendinning, achieve tangible transformational change.
MVI and Retail Forward. Enhanced with With offices in 15 countries, we work with
the expertise of our WPP sister companies, more than 350 companies. To learn how
we help our clients achieve both major Kantar Retail can help your company
shifts in their business and incremental enjoy the immediate benefits of tangible
For further information please contact: improvements. transformation, please see our details on
the opposite page and contact us.
USA
• Insight: Our syndicated intelligence
Steve Pattinson, Chief Executive Officer. services, MVI-Insights and the Retail
Kantar Retail – Market Insights, Ste. 1000 Forward Intelligence System™, provide
245 First Street, Cambridge, MA 02142 unparalleled insight into global retailing
D: +1 617 588 4110 and retail brands. To understand purchase
F: +1 617 499 2723 behavior we rely on our Shoppers
E: steve.pattinson@kantarretail.com Genetics® database, the largest loyalty
household database in the US, and
EMEA ShopperScape, our monthly survey that
Ethan Sinick, Managing Director. tracks where people are shopping and
Kantar Retail – EMEA, 6 More London Place what they’re buying.
Tooley Street, London, England, SE1 2QY
• Strategy: With custom consulting we
D: +44 (207) 031 0257
help our clients identify the key drivers
F: +44 (207) 031 0270
of category growth and more effectively
E: ethan.sinick@kantarretail.com
understand and shape the path to
purchase. We also specialize in helping
ASiA
our clients with marketing and trade
Phil Smiley, Chief Executive Officer.
Kantar Retail – Asia Pacific, 25th Floor
The Center, 989 Changle Road
Shanghai 200031, China
D: +86 (21) 2405 0291
F: +86 (21) 2405 0133
E: phil.smiley@kantarretail.com
GLOBAL RETAiL BRANDS 2010 75
DiRECTORY
WPP is a world leader in marketing

communications.
WPP companies, which include some of the

most eminent agencies in the business, provides
global, multinational and local clients with:
Advertising
Media Investment Management
Consumer Insight
Public Relations & Public Affairs
Branding & Identity
Healthcare Communications
Direct, Digital, Promotion

& Relationship Marketing
Specialist Communications
Collectively, WPP employs over 138,000

people (including associates) out of almost
2,400 offices in 107 countries. Clients
include 354 of the Fortune Global 500,
60 of the NASDAQ 100 and 33 of the
Fortune e-50.
A complete list of WPP companies and

a searchable directory is available at
www.wpp.com/WPP/Companies
For further information contact David Roth

david.roth@wpp.com

Design by Lambie-Nairn
www.lambie-nairn.com
Writing by Ken Schept

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The Top 20

Retail analysis of the with technology, think differently about what

Top 20 Most Valuable First, brand is a prerequisite of retail

Global Retail Brands impacts all aspects of their business. Brand

This report elaborates on these

Analysis by Kantar Retail from Bryan Gildenberg and Ethan Sinick

The Top 20 Profiles 22

The Top 20 Summary Chart 62

About Kantar Retail 74

4 GLOBAL RETAiL BRANDS 2010 5

The overall brand value of the and their importance in

In fact, the Top 10 most valuable global

6 GLOBAL RETAiL BRANDS 2010 7

Especially during periods of economic

Get the full BrandZ Top 100 report

8 GLOBAL RETAiL BRANDS 2010 9

complicated. well-being. Factor in the dramatic rise in smart phones

10 GLOBAL RETAiL BRANDS 2010 11

The e-commerce and mobile revolution

12 GLOBAL RETAiL BRANDS 2010 13

# Position Brand Parent Company Brand Brand Brand Brand

20. = UK J Sainsbury Plc $2.728 -4% 5 4

14 GLOBAL RETAiL BRANDS 2010 15

The changing consumer A global perspective

16 GLOBAL RETAiL BRANDS 2010 17

E-commerce is no longer just stores may isolate a management problem.

a nice way to top-up sales.

18 GLOBAL RETAiL BRANDS 2010 19

20 GLOBAL RETAiL BRANDS 2010 21

1.WALMART Plus, shopper attitude changed a bit last

as Walmart last year. looking for a more complete grocery

22 GLOBAL RETAiL BRANDS 2010 23

2. AMAZON Amazon and Zappos share a problem-

the fastest growing global brands

and priced accordingly. Unparalleled

dominate the holiday season. brand began.

3. TESCO The exceptions to the company’s strategy

That performance reflected the At a glance

4.CARREFOUR In Europe, the Carrefour brand remains

Being managed for short-term objectives

remained flat last year. Brazil, where a recent acquisition produces

home market. Millward Brown

5. TARGET This initiative seemed promising and

rebound during the holiday season.

As sales revived against soft 2008

remodelling its existing locations to include d designer

6. EBAY Not all of eBay’s business is about selling

area last year.

32 GLOBAL RETAiL BRANDS 2010 33

7. hOME DEPOT To fill some operational gaps, legacies of the

of the home equity that pays for of the store.

improvements. Plus, compared with The warehouse for

8. ALDi Both ALDI organizations face the predictable

ALDI brand appreciated slightly. to draw price-conscious consumers. equivalent impact.

At the same time, ALDI is losing a signature

about 800 items, mostly own-label, , ALDI

9. AUChAN Similarly, few businesses are branded

China helped the brand navigate A family-controlled enterprise, Auchan

successfully through the recession.

10. LOWE’S had going into the recession, and it did

As housing starts, mortgage applications

11. BEST BUY not only impacts Best Buy’s entertainment

Along with entertainment, Best Buy’s

value by 18 percent last year. appliances (6 percent). Best Buy added