International Retail Index The definitive guide to international retail in 2018 in partnership with The definitive guide to international retail in 2018 is brought to you by Loqate, in partnership with Planet Retail RNG and Retail Week Connect. Take a deep dive into the top 30 retailers trailblazing in global commerce, plus learn the strategies and technology needed to succeed beyond your local market. Loqate offers the single most reliable way to reach your customers in 240 countries and territories. We are the world’s most trusted location intelligence data specialist for businesses of all sizes and sectors. Helping every business in the world, reach every customer in the world. Page 2 Contents 5 Index 12 Introduction 15 A note from our partners 18 Retail Internationalisation 24 Multichannel strategies 28 Online capabilities 34 The power of mCommerce 40 Localising your offer 44 Conclusion 48 Methodology Page 3 Loqate International Retail Index is the definitive guide to the best in class when it comes to international retail in 2018. The top 30 brands analysed are from the UK, US and Europe and are leading the way in international retail. They are ranked by revenue, projected growth, physical presence, online capabilities such as address verification, delivery and payment options. Page 4 Retailer by rank Rank Retailer 14 Hello Fresh 15 Marks & Spencer 1 16 Deichmann 17 Schwarz Group (Kaufland/Lidl) 2 18 Aldi 19 Kingfisher/B&Q 3 20 The Gap 4 Sports Direct 21 Walgreens Boots Alliance 5 Apple 22 Rewe Group 6 TopShop (Arcadia Group) 23 Ahold Delhaize 7 Zooplus 24 Tesco 8 Sephora 25 Ceconomy 9 Walmart 26 Best Buy 10 Zalando 27 TJX 11 John Lewis 28 dm 12 Next 29 Home Depot 13 Costco 30 Dixons Carphone Page 5 Retailer by region: United States of America Rank Retailer 1 2 3 4 Costco 5 The Gap 6 Walgreens Boots Alliance 7 Best Buy 8 TJX 9 Home Depot Page 6 Retailer by region: United Kingdom Rank Retailer 1 2 3 4 TopShop (Arcadia Group) 5 John Lewis 6 Next 7 Marks & Spencer 8 Kingfisher/B&Q 9 Tesco 10 Dixons Carphone Page 7 Retailer by region: Europe Rank Retailer 1 2 3 4 Hello Fresh 5 Deichmann 6 Schwarz Group (Kaufland/Lidl) 7 Aldi 8 Rewe Group 9 Ahold Delhaize 10 Ceconomy 11 dm Page 8 Retailers offering next day delivery Rank Retailer 10 Next 11 Costco 1 12 Marks & Spencer 13 Deichmann 2 14 Kingfisher/B&Q 15 The Gap 3 16 Walgreens Boots Alliance 4 Sports Direct 17 Ahold Delhaize 5 Apple 18 Tesco 6 TopShop (Arcadia Group) 19 Ceconomy 7 Sephora 20 Best Buy 8 Zalando 21 Home Depot 9 John Lewis 22 Dixons Carphone Page 9 Retailers offering international address verification Rank Retailer 1 2 3 4 Sports Direct 5 TopShop (Arcadia Group) 6 Next 7 Costco Page 10 Retailers offering domestic address verification only Rank Retailer 10 Schwarz Group (Kaufland/Lidl) 11 Kingfisher/B&Q 1 12 Aldi 13 The Gap 2 14 Walgreens Boots Alliance 15 Rewe Group 3 16 Ahold Delhaize 4 Walmart 17 Tesco 5 Zalando 18 Ceconomy 6 John Lewis 19 Best Buy 7 Hello Fresh 20 TJX 8 Marks & Spencer 21 dm 9 Deichmann 22 Home Depot 23 Dixons Carphone Page 11 Introduction Page 12 David Green Managing Director - Location Intelligence Services, GBG plc Whether it is pure-play retailers Any retailer worth their salt should be integrating smart technology focused on making convenience a priority at every stage, and using the very best to power a world-class technology to enable this. They should checkout, or multi-channel put their customers first, while providing retailers ensuring that the seamless and delightful experiences. All customer journey is seamless, things, which are relatively easy to deliver in a territory you know, the challenge comes the reoccurring themes when you begin to operate outside of your throughout the findings of this comfort zone. internationalisation index is ‘convenience and innovation’. However, this is an obvious point. Page 13 Retailers can confuse ‘going international’ You will not be surprised to see gargantuan as world domination, a scary task that only companies such as Amazon in the top a few (with big purses) have achieved. The 30. However, it is important to remember smartest of our top 30 are looking at what that our index looks beyond the billions of internationalisation truly means to them, dollars these companies turn over. It also how they can think global, but act local. looks at the execution of what a successful Successful international retailers recognise international strategy looks like, which in this why we, as consumers, buy the products we index, is what counts. do, and the lifestyle we want to emulate. The leaders understand the seasonality of It is exciting to observe an acceleration the market place, the importance of cultural of retailers disrupting the status quo, just differences, the complexity of taxes and as Amazon did back in 1994. These new governance. Most importantly, those in our trailblazers are experts in their local top 10 have ensured they select partners markets and are hot on the heels of the and technology that understands these local number one spot. nuances too and can help them deliver this Whether you are here to discover where seamless and convenient experience. you rank against the top 30 in the index, or perhaps you are just starting out in international commerce, there is lots to take away. As the worlds most trusted data specialist in location intelligence, we are here to help every business in the world reach every customer in the world. Page 14 A note from our partners Page 15 Robert Gregory Global research director PlanetRetail RNG is delighted to be The rise of eCommerce and digital influence partnering with Retail Week and has rewritten the rules of what a global Loqate to present our inaugural retailer now looks like. We have therefore internationalisation index. designed our international index to reflect this - identifying and scoring retailers’ Traditional methods of measuring how abilities to serve customers outside of their ‘international’ a retailer was focused home market through a growing range of on physical metrics such as how many digital capabilities, often complemented markets they operated in and how and supported by their physical store many stores they operated outside their networks. As a result, our index includes a domestic markets. Growing a strong number of fast-growing primarily digital international presence was typically players, many of whom would not have capital intensive and took years of organic had a presence on traditional international store openings or acquisitions, meaning retail rankings even five years ago. What that such rankings were dominated by a they demonstrate is that digital is a key ‘usual suspects’ list of established global enabler of internationalisation – opening retail heavyweights. up opportunities for those retailers who are able to develop the capabilities that make the online experience as appealing and frictionless for customers wherever they are in the world. Page 16 Ian McGorrigle Chairman, World Retail Congress & Cofounder of Retail Week UK retail – be it digital or physical In chapter one we set the scene by looking – is renowned the world over for its at why UK retailers have chosen to launch competitiveness, with distinctive brands, abroad, and highlight common themes products and talent. So it’s little surprise that identified within the data are. In chapter two recent history has shown UK retailers taking we find out why a multichannel approach their propositions overseas. including stores is still important for international growth, and in chapter three, However, retail is very much a global we analyse what a successful eCommerce business – and our home-grown retail strategy looks like. businesses need to understand what takes a business from local dominance to the With increased smartphone adoption the international stage. They also need to know world over, in chapter four we turn our who the key international players are, and attention to mCommerce and how retailers what they can learn from their are reaching out to consumers in this business strategies. channel, while in chapter five we look at the importance of localisation. In chapter six, we For this reason, Retail Week and PlanetRetail share the key take-aways that should inform RNG have partnered with Loqate, to produce your international strategy. our first annual index of the world’s top 30 international retailers. Retail Week has Clearly, international retailing is fraught with analysed exclusive PlanetRetail RNG data to challenges, but if this index shows anything, identify the secrets to international success. it is that there is a formulae to success. Page 17 Chapter 1 Retail Internationalisation Page 18 Globalisation and overseas Investment in technology and eCommerce expansion in the retail industry capabilities enables retailers of varying scale to grow faster and develop a more have become increasingly universal appeal. While the top 30 is a mixed prominent features in the bag of fast-growing pureplay retailers and digital age, with businesses traditional high street groups, one trait these across all sectors adapting their companies share is an effort to enhance their presence, payment and delivery options strategies to take advantage of on a global scale. international opportunities. In recent years, this has been enabled and accelerated by growth in smart-phone By using scalable technology, adoption, and new technologies such as retailers can forgo the elevated artificial intelligence, alongside demographic changes such as the emergence of more costs and regulatory issues middle class consumers in relatively associated with traditional untapped developing markets, such as China expansion methods and India. Demand in these markets show no sign of Using data from PlanetRetail RNG, we have abating either, with 60% of global online detailed and analysed the top 30 retailers spending set to come from China by 2020, globally in terms of internationalisation and according to eMarketer.