#BESTRETAILBRANDS Bi l ppAr Contsnte

To see interactive content Introduction 002 throughout the book please The magic of retail theater 008 follow the instructions below. What digital means to retail 014

Sector overviews 022 DOWNLOAD Apparel 024 Department store 030 Drugstore 036 Electronics 040 LOOK FOR THE Grocery 044 BLIPPAR LOGO 048 ON EACH PAGE Home improvement Mass merchant 052

Regional overviews 056 FILL SCREEN North America 058 WITH THE 080 DOUBLE PAGE Europe Asia-Pacific 102 Latin America 116

BLIPP... 128 THE IMAGES Methodology WILL JUMP About brand strength 132 TO LIFE Appendix 134

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FILL SCREEN By Jez Frampton, Global Chief Executive OfficWITHer, THE Inter brand DOUBLE PAGE

BLIPP... THE IMAGES There is no doubt that WILLthe JUMP TO LIFE retail landscape has changed Introduct dramatically in recent years. Demographics are shifting, i on behaviors are changing, and consumer spending priorities reflect an atmosphere of economic uncertainty around the globe. As a result of these trends, in-store traffic is slowing for brick and mortar retailers and cumulative sales are shrinking by the billions.

Best Retail Brands 2014 But, above all, one macro trend prevails From mobile shopping and augmented In the end, it is the brand, not the If anything has become and shows no sign of letting up: digital. reality apps to virtual storefronts footprint, that will endure. And that clear, it is that wherever Today, anyone with a product and and fitting rooms, retail brands are brand’s growth or decline, especially a website can build their own sales reimagining the customer journey in retail, ultimately depends on the a retail brand operates, channel—and, as we’ve learned, new through a digital lens. They are also loyalty and satisfaction of customers. standing still is not entrants can shake things up fast. taking the art of display and presentation Yet, how this is achieved varies from an option. In today’s Meanwhile, established online giants like to new heights and creating meaningful region to region. Amazon are capturing a growing share of social experiences in physical retail rapidly evolving global the retail pie. And as pure online players environments—giving customers more With the entire world now serving as marketplace, brands increasingly look to enter into—and reasons than ever to get out the door our real-time research lab, what lessons disrupt—new categories, such as grocery, and into the store. can Western brands learn from Eastern must be more agile, the penetration of e-commerce will brands—and vice versa? What can flexible, and responsive continue to impact traditional retail. Knowing that many retailers are dominant big box retailers learn from still searching for the most effective brands that have learned to thrive in than ever before. Is this the end? Well, it depends how omnichannel strategy, the 2014 Best dense urban centers at a smaller scale? you look at it. At Interbrand, we do Retail Brands report highlights what Which consumer behaviors reflect Consistency still matters, but it’s not not say “The world has the power to successful retailers are doing to meet universal human tendencies, and enough. Living brands adapt and change brands”—we say, “Brands swiftly evolving consumer expectations— which are a variable product of culture? that means testing, experimenting, have the power to change the world.” online and off. We also share key findings (To help you answer some of these stretching, and understanding the Introduct And we stand by that proclamation. on digital trends, insights on enhancing questions, please refer to the following cultures and communities you’re In this Darwinian struggle playing out the in-store experience, snapshots of pages, which will provide you with operating within. The structural shift in the malls, shopping centers, and seven major retail sectors, and overviews an at-a-glance cross-cultural guide from physical to digital retail has not internet retail hubs of the world, a great of retail activity in four global regions: to building retail value.) been painless—and reinvention is a turning is afoot which brings with it Asia-Pacific, Europe, Latin America, must. But we know that extraordinary

a historical opportunity. and North America. retail brands will not only survive the i on transition—they will become more Digital, which currently While digital has brought more extraordinary because of it. commonality to brand management and #BESTRETAILBRANDS threatens all that retail the issues, challenges, and opportunities once was, also promises brands face across these regions, our report reveals that what works in one to make it what it was region does not necessarily work in destined to become: a all. In many markets, expansion is the du jour living theater, a crucible strategy but, as The Home Depot found in its forays into China, more of human creativity, and stores do not always equal success. Jez Frampton the field where brands and Others are expanding their reach and Global Chief Executive Officer broadening their appeal through mergers Interbrand consumers meet to foster and acquisitions. But, in a finite world, prosperity and co-create expansion has its limits. In a diverse, fast-moving world, consolidation and a new reality. “colossalization” has its disadvantages.

4 Best Retail Brands 2014 Lessons for all Latin America The regions at a glance • Digital must be used strategically to bridge a compelling in-store experience with Emerging trends a multi-dimensional digital strategy • With a growing middle class and an increase (omnichannel selling, seamless access in consumer spending, most retailers are North America Lessons for all and transactions, etc). seeing strong financial results. • While e-commerce sales continue to Emerging trends grow 10 percent each year, questions • Retailers must use data to gain a true • Supermarket and apparel brands are • Amazon continues its relentless growth to about the role of brick and mortar seem understanding of shopper insights and particularly strong in the region. become “the everything store.” Analysts to be largely resolved. create a frictionless shopper journey, predict Amazon will soon carry more than putting their brands at the cornerstone • To meet rising consumer expectations, 85 percent of the products sold at leading • The store is now a brand experience that of that journey to achieve engagement, brands are improving service in both retailers—including groceries with Amazon drives revenues across all channels. responsiveness, authenticity, and relevance. traditional and digital channels. Fresh—at better prices, with more delivery methods and payment options. • Nearly all North American retail brands • Major retailers such as Renner, Casas Bahia, on our list this year offer competitive Asia-Pacific Lojas Americanas, and Extra, are using • A fully functional mobile presence is a given pricing, convenient purchasing and lending (credit cards and financing) to for every brand; the new omnichannel payment options, a pleasant shopping Emerging trends increase revenue as well as customer loyalty. reality has led to a rise in “connected stores experience, offerings that are meaningful • Home to approximately half the world’s for connected customers.” and relevant, and demonstrate that they population and witnessing rapid • Many brands are taking advantage of understand the complex and challenging urbanization and income growth, with the region’s increased internet and • Health clinics inside retail chain stores have relationships between analog and digital, China set to overtake the U.S. as the world’s broadband penetration. doubled over the last six years led by CVS, retail and the shopper. biggest retail market by 2016. which, in a move to strengthen its image Challenges and Risks as a healthcare retailer, will remove tobacco • Online retailing is giving traditional retailers • Economic uncertainty and a degree from its stores this year. Europe the opportunity to expand more rapidly; of political and social turmoil. multichannel retailing is finally starting • Increased cross-border activity (e.g., Target Emerging trends to take hold; innovation is everywhere. • Devaluation of local currencies, which can #BESTRETAILBRANDS arrived in Canada this past year; Saks Fifth • E-commerce accounts for an estimated 5 have a negative impact on brand value. Avenue will go north in 2015). percent of retail sales in European retail; • China has the world’s largest online traditional retailers such as Zara, John population and Asia's most vibrant • Bureaucratization continues to pose Challenges and Risks Lewis, Carrefour, and Fnac are catching up e-commerce sector. obstacles. • Electronics retailers are facing increased with digital pure players. pressure due to showrooming. Challenges and Risks Lessons for all • The drive-through hypermarket format has • Adapting to diverse cultural preferences and • Adapting retail formats to accommodate • The general merchandise department become one of the secret weapons for food languages as well as navigating a variety the shift in consumer preferences for store is facing challenges; Sears and retailers to protect their business and build of regulatory hurdles. e-commerce is proving to be the key JCPenney are in decline. on the strength of their brand; Walmart to success for many retailers. is replicating this format in the U.S. with • Increased competitive threat from more • North American brands with an Walmart To Go. agile online retailers. • Brands must become more responsive to overabundance of stores may not be able stay relevant and add differentiating value, to withstand declining top-line revenue Challenges and Risks Lessons for all especially when it comes to integrating the growth for long. • Brands must be willing to invest to take • Online and offline offerings need to work online and physical retail experience. advantage of the omnichannel revolution in harmony. • Online retail is rapidly taking share in and work harder to ensure that convergence • The winning retail brands are those many retail categories. benefits consumers and increases • Retailers must innovate, or suffer a that provide a consistent and pleasant satisfaction online and off. potential decline to their dominant customer experience. • As one of the highest consumption, high positions as competition broadens. output regions in the world, sustainability • Retailers must bridge their brand must be a priority. proposition with customers’ needs and • Use back-end data to know the customer desires and pursue growth sustainably. and gain competitive advantage.

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FILL SCREEN By Alison Cardy, Managing Director, HMKM & WITH THE Colin Melia, Creative Director, HMKM DOUBLE PAGE HMKM is an Interbrand Group Company

BLIPP... THE IMAGES WILL JUMP The concept of the store is evolvingTO LIFE and the ‘retail experience’ is anything but standard—it is now limited only by the human imagination. From social media to social spaces, from digital touchpoints to “art malls,” smart retailers are bringing their brands to life by engaging customers’ lives and the desire for social, connected meaning.

Pop-up, omnichannel, immersive, Shoppers’ desire for a remarkable destination, online, brick and clicks— branded shopping experience is today’s retail experiences are multi- revolutionizing the way retailers deliver dimensional. Incorporating taste, touch, brand propositions across all touchpoints. smell and sound, they are also rich, Gone are the days when shopping tactile and exciting. This is the language was a mundane chore to check off today’s retail brands are speaking—a one’s to-do list. Today, consumers new vocabulary that unites art, design, have an overwhelming array of options commerce, digital technology, and to consider when making a retail consumer psychology. It is a very specific purchase, so it is paramount for brands language, combining practical, aesthetic, to express the true essence of who they and high-tech elements, and one that has are and give customers a unique and evolved in response to a changing retail memorable experience. landscape and a more complex range of consumer expectations.

8 Best Retail Brands 2014 The evolving art of presentation Theater—the art of dramatic presentation—is the key to creating a One word captures today’s retail zeitgeist: differentiating retail experience that whets the shopper’s appetite, incites Theater. It’s what’s being action, and keeps customers coming back for more. It is these spaces that sought after by all of our generate word of mouth both pictorially clients across the globe. and verbally via a plethora of social media platforms and also hit the design news More than ever, consumers are seeking in printed press. Some brands that have a point of difference and are eager to successfully managed this include Nike, become “fans” of a brand that makes a Dover Street Market, Hermès, and H&M. positive impression by inspiring them, engaging their imagination, and making them happy. Such a fan, of course, is Igniting the imagination much more likely to share his or her RETAIL OF MAGIC THEATRE THE interest via social media or physically Our firm, HMKM, approaches its design through conversations with friends, for large (and we mean big!), multi- which is why brands, as many celebrities floor destination stores as if they were a know these days, must engage audiences boutique-scale client, bringing custom and cultivate a fan base. details and a personal touch to larger spaces that are ordinarily experienced Retail brands that provide the most only in smaller store concepts. This novel, interesting, or convenient physical approach is exemplified by our work interaction are the ones that tend to win with Selfridges in the U.K., Tsvetnoy hearts and mindshare. These brands in Moscow, and the soon to launch give people compelling reasons to leave Emporium in Bangkok—each an iconic the comfort of their homes (and the department store that fully embodies the #BESTRETAILBRANDS ease of online and, increasingly, mobile “retail theater” concept. shopping) and venture into a brick and mortar retail space. Selfridges’ Festival Of The Imagination event, that ran in January and February earlier this year, invited customers to experience Selfridges not only as a store, but also as a “portal into the the recently revamped Regent Street creative mind.” From its “No Noise” flagship in London. Further, their logo-free retail experiment in 2013 to FW2014 collection was streamed live and the interactive style and fit digital table customers were able to select and shop featured in our Denim Studio concept, straight from the catwalk, with the Selfridges has long sought to innovate added bonus of gleaning free shopper and reinvent the shopping experience. insights by crowdsourcing reactions to And it’s not just Selfridges that’s creating filter through to the commercial buy. a connected world. Clever stuff!

Burberry is leading the pack by being the first retailer (and a heritage one at that) One-of-a-kind social experiences to be recognized today as a forerunner in digital experimentation—consider the While social media platforms, home brand’s amazing holographic catwalk entertainment systems, and online presentation in Beijing in 2011—and shopping keep many of us entertained digital implementation, as seen at and socially engaged indoors, even when

10 Best Retail Brands 2014 we’re alone retailers are finding creative With creative architecture, high-end The new luxury leadership ways to get us out the door and into the boutiques, and displays of local artists’ store by connecting to others who share work at every turn, engaging food Today, true luxury brands are adding similar interests. We are, after all, social options—some sourced from organic value through impeccable service and creatures by nature. produce grown inside the mall—are delivering all the frills a hefty price tag also a big attraction. implies. But we believe that to remain Counteracting any tendencies toward relevant, luxury brands should also pave isolation in this high-tech world we the way for the next-generation retailing live in, more retailers are responding Posh pampering experience. Augmented Reality, 3D with community-driven experiences printing, digital presentation, bespoke hosted by their stores. NikeTown offers Breuninger, the aspirational German detailing, limited edition collaborative fitness classes in Berlin and running department store, also differentiates product lines—much of this technology clubs around the globe. Reebok’s Fifth itself through its Stuttgart dining is still too expensive for many retailers Avenue store in New York has a CrossFit offer, (karls) kitchen, an upscale to fully integrate and realize, leaving studio. Lululemon stores worldwide food court that is as glamorous as it room for luxury retailers to innovate have long offered yoga classes.Beyond is convenient. A trio of seating areas and pioneer with high tech. RETAIL OF MAGIC THEATRE THE sport retailers, hybrid retail concepts are features luxurious materials and stylish creating communal spaces to bring their décor, each with its own distinct Luxe brands have a window of brands to life. Shed, a sustainable “food character. Open kitchens feature large opportunity to create spaces that truly community” and kitchen/garden retail fridges stacked with fresh produce, which reflect their brand ethos across all space in Healdsburg, California, offers double as display cases. The kitchen and platforms in a connected seamless a fabulous café, workshops, talks and bar areas serve sandwiches, juices, and manner. By creating the kinds of gathering areas in addition to its pastries alongside made-to-order local, experiences others feel moved to blog, unique merchandise. Asian, and European specialties. There is tweet, and spread the word about, luxury even a private space for events, parties, brands can benefit in a big way, even In China, K11 “art malls” in and workshops. as they reward their high-spending customers with unique interactions. Hong Kong and Shanghai It’s a smart strategy because shoppers #BESTRETAILBRANDS are bringing “art, people don’t always venture into a dining At the top end of the spectrum, luxury From boutiques to malls, from area simply because their stomachs are retailers are reinventing what true luxury department stores to meta-luxury brands, and nature together in growling—their souls are hungry, too. shopping should be about. As emerging the leading retail brands today are casting harmony” to create a truly They come because they want to be social, markets become increasingly brand magical spells within the theaters of unique shopping and soak up the ambiance, linger over coffee, savvy and quicker to embrace affordable their physical stores. If a brand sets the and be part of something special. designer brands, the Kering- and LVMH- stage right, ordinary happenings can be dining destination. owned brands are losing out to newer kids transformed into extraordinary ones that on the block such as Michael Kors, Tory captivate customers, influencing them to Burch, Furla, and Isabel Marant. keep choosing your brand from among so many others, again and again.

S UmmARY

• Retail brands that provide the most • One-of-a-kind social experiences, novel, interesting, or convenient ambiance, and eateries also add physical interaction win hearts value. and mindshare. • Luxury retailers are paving the way • Theater—the art of dramatic for high tech innovation. presentation—is the key to creating a differentiating retail experience.

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FILL SCREEN By Paul Phillips, Digital Director, Interbrand WITHEurope THE DOUBLE PAGE

BLIPP... In a remarkably short period ofTHE IMAGES time, WILL JUMP the social web and mobile technologyTO LIFE have transformed the way consumers live, work, play, and shop. Against this high-tech, hyperconnected backdrop, retail brands are innovating continually in order to remain relevant.

retail brands are using digital your organization up to speed digitally, to transform the shopping we’re sharing some findings on digital experience trends and highlighting what successful retailers are doing to meet swiftly As internet use has grown, retailers evolving consumer expectations. have launched—and relaunched—their websites. As consumers began to adopt mobile technology, retailers responded Shopping is everywhere—and it’s with mobile-ready shopping experiences. going mobile But, increasingly, consumers are looking to integrate their physical and digital Building a digital presence worlds into a seamless experience that is no longer an “extra”— will allow them to get the benefits of value and convenience wherever they are. it’s a must.

While many retailers are still searching Consumer behaviors are changing fast, for the best ways to integrate digital into and retailers that want to stay ahead a holistic brand experience, others are will have to keep up. Accenture’s report, already using digital channels to delight Energizing Global Growth, puts the retail customers, win fans, build loyalty, and landscape into sharp relief: generate brand value. To help you get

14 Best Retail Brands 2014 • 73 percent of consumers researched Google’s The New Multi-screen World study or purchased online more than they revealed that consumers are juggling did 5 years ago, with social media an mobile devices: 65 percent of people important part in the process start the online shopping journey on a mobile device, usually a smartphone, but • 68 percent say it’s important for them increasingly they’re starting on a tablet. to be able to buy what they want, when If the purchase is not completed via they want it smartphone, shopping then continues on a laptop, PC, or tablet. • 63 percent want to customize products or services to their exact specifications However, the adoption of mobile phones is what has really shifted behavior. As • 51 percent say they consider the consumers realize that mobile web lets environmental impact of a product them fulfill their most spontaneous before buying shopping desires instantaneously— What to digitalretail means anywhere, anytime—mobile shopping • 73 percent of business executives has become irresistible. The Digital recognized a marked change in Marketers United research by Econsultancy Laid out just as they’d be in a traditional the offline gap between consumer behavior in the last three confirms just how much people are using shop, Tesco created 22 virtual stores the Tesco-owned brand years, but 74 percent admitted they did mobile to shop. As one might expect, in subway stations and bus stops. The not fully understand those changes, among people aged 18-34, 44 percent in product images on the “shelves” featured and emart; and its app has and 80 percent believe their companies the U.K. and 42 percent in the U.S. are QR codes that could be scanned by the been downloaded more were not taking full advantage of shopping via mobile. However, among Homeplus app, allowing the shopper than one million times. current trends and opportunities those aged 35-54, 21 percent in the U.K. to fill a virtual cart and have groceries and 28 percent in the U.S. are also using delivered home in minutes or hours—not Making its mark in the offline world last According to Forrester’s U.S. Online Retail mobile to shop. As retailers master the days—later. year, eBay debuted connected digital Forecast, 2012 to 2017, e-commerce, which mobile shopping experience and mobile storefronts for shoppers at the Westfield accounts for about 8 percent of total retail payment systems improve, this mode of Mall in San Francisco. Integrating #BESTRETAILBRANDS While many big sales in the U.S., is expected to outpace purchasing will only continue to grow. shoppable windows, mobile technology, brick and mortar retail sales to reach supermarkets have and digital payments, this partnership USD $370 billion in sales by 2017. Digital mobile-optimized gives Westfield brands Sony, TOMS, and research firm eMarketer projects that Virtual shops bring the store to Rebecca Minkoff the ability to sell from e-commerce growth will be greatest in the customer websites for online virtual storefronts. the Asia-Pacific region, followed by North shopping, Homeplus’s America and Europe, where it will reach Innovative digital shopping experiences Cannes Lion-winning Aiming to bring itself closer to where the nearly 40 percent of total sales in the are accelerating as physical retailers majority of transactions are happening— business to consumer sector. increasingly go virtual. When Tesco, for virtual store pushed the in stores—eBay has tested similar instance, wanted to gain market share idea of mobile shopping ventures with Kate Spade’s Saturday In order to design the best shopping in South Korea, it had to take on emart, brand in New York. If these trials experience, it’s imperative to understand the country’s leading supermarket into the minds of people continue to see success, it could help eBay which devices people are using, as well and discount retailer. Though Tesco’s who could use it on the build its offline presence and its eBay as the context in which they’re using Homeplus retail chain is second to emart Now delivery service. The screens also them. The type of device shoppers choose in market share, Tesco had to innovate go. The result? According allow eBay (and participating retailers) to is primarily determined by opportunities, to stand out and impress the one-fifth of to The Telegraph, collect shopping metrics and sales data. location, and economic status followed by the population who use smartphones. Homeplus’s online sales context—what mood they are in, where In a brilliant move, it brought the Whether we see virtual stores as a they are, what time of day it is, what they convenience of mobile shopping to increased 130 percent in display advertising campaign or a new want to accomplish, and how much time commuters waiting for trains and buses. three months. It’s now way of building mini-stores in spaces they have for the task. that already exist, either way, it’s a the number one e-grocer completely new way to shop and a leap in the market, narrowing in retail innovation.

16 Best Retail Brands 2014 Keep it personal for its members, the company maintains than an email. On average, 98 percent share information, swap tools, and an Inspiration Wall where members of SMS communications in the U.S. address neighborhood issues. While Email is still the key marketing channel can upload and share design inspirations are opened and read, according to encouraging DIY skill sharing and whereas social is still in its experimental and a “Live Feed,” which enables users LogMyCalls tool borrowing might not sound phase, but when enhanced by content to share what they are buying, liking, like a smart way to do business, and personalization, social media is and tweeting on Fab.com. Selling an • Increasingly, many brands are using B&Q sees its initiative as one that is a force to be reckoned with. In the average of 5.4 products per minute, digital technology to help customers contributing to a greener economy, fashion world, perhaps no brand is Fab has found a winning approach—and personalize products. Clinique, for future-proofing its business, and using social platforms as effectively as has even ventured offline with its own instance, has created a custom-fit building its reputation as a community Burberry. In 2011, the success of its first retail stores. beauty experience at its counters using resource and innovation leader. Tweetwalk sent the #Burberry hashtag iPads and exclusive software. The self- trending worldwide on Twitter—and Personal recommendation is still guided skin care diagnostic tool helps • Sephora is taking advantage of social showed retailers a whole new way to one of the most effective ways to consumers identify skin care concerns media in a different way: by launching excite and engage consumers. From sell something—a fact perhaps best and processes over 180,000 product a Pinterest-like community called its HD live stream of the catwalk—and demonstrated today by Amazon’s combinations that precisely match The Beauty Board, which is integrated What to digitalretail means accompanying tweets, Instagram shots, recommendation engines’ ability to drive each consumer’s personal needs. At the with the Sephora to Go mobile app. song tracks, and animated GIFs of key sales. Brands such as Burberry and Fab end of the analysis, consumers receive Fans can pin a photo that will be looks—Burberry’s mastery of digital are successfully using social media and a printout or email with a list of very linked directly to Sephora.com for technology is reaching consumers in social communities to step outside of specific product recommendations. As an opportunity to buy the products more territories and on more platforms the traditional advertising model and the Clinique example also illustrates, necessary to get the look. than ever before. allow customers to help build the brand more retailers are seeking to create a through their own discussions and physical shopping experience that is as recommendations. intuitive as the best web sites. Be customer-centric, not channel-centric Clearly, social technologies present a • Virtual fitting rooms and augmented key opportunity for retailers to build reality mobile apps are another Creating a single relationships with their consumers. growing digital trend in retail. IKEA’s customer-centric view There are, however, different levels mobile app helps consumers visualize #BESTRETAILBRANDS of activation and engagement. Here what furniture items might look like in with an integrated multi- are a few ways retail brands are using their own home—exactly to scale and touchpoint customer digital to make the shopping experience where one would want each item to more personal: fit—directly from the digital versions journey will make the of its catalog. shopping experience more Fab, online purveyor of everyday design • From Burberry to Walmart, brands enjoyable—and your retail products, built the world’s fastest are using customer data to help staff growing e-commerce site using a know their customers—by name, brand more valuable. Here combined approach, bringing together preferences, and previous purchases— are some examples of direct email and content marketing. to help them find what they want. According to Mashable, Fab had attracted how retailers are joining 10 million customers across 26 countries • Retailers are also using email, social up online and offline within its first 18 months. Kicking media, and mobile to keep customers off the effort with a 200,000 member informed about sales and in-store channels to deliver better pre-launch list, the site’s reputation events. Geofencing, for example, customer experiences and member base grew through social a location-based service that sends • Social media is also allowing retailers and greater business and sharing, which is how most customers messages to smartphone users who to explore new models of collaborative discover the brand. enter a defined geographic area, is a consumption. B&Q, the largest home brand value: way to deliver alerts, relevant offers, improvement and garden center Fab has also integrated analytics to and information about coupons retailer in the U.K., has created the • Emailing receipts at the point of understand its customers and track and discounts. Text messaging has Streetclub social network, which aims sale to grab customer data for future their purchase behaviors, which helps proven to be an effective way to reach to build communities, virtual and real. communications and eliminate the brand curate its offer. Further consumers, especially younger ones With over 1,000 clubs set up, members printing—saving cost in the long run personalizing the shopping experience who are more likely to read a text are using Streetclub to talk, and a plus for the environment.

18 Best Retail Brands 2014 • Furnishing staff with tablets to enhance U.S. As Apple’s senior vice president of customer service by helping customers retail has stated, “Online, offline, it’s see more products than are displayed gotta be the same.” in-store, personalize items, and get information on stock availability. The customer journey is still • Offering remote customer service and what matters most collaboration technology—including interactive kiosks—that help bring The shopping experience retail services, support, and remote will continue to change product expertise closer to the consumer. Nationwide Insurance in as many retailers reduce the U.S., for instance, has teamed their physical presence up with Cisco to provide high-tech mortgage service. and invest more in What to digitalretail means experiential, digital- • Using mobile to boost in-store service. enabled spaces. Today, The Neiman Marcus brand in the U.S. has launched a number of apps, such retailers will have to as the NM Service app, which included constantly think of new QR codes, plus NM Gifts, and NM action. The latest: the NM app, which ways to meet customer allows iPhone users to text, email, call needs and fulfill desires— or FaceTime favorite sales staff, track loyalty rewards points, and stay on top better and faster than of promotional events. ever before.

• Experiential stores and showrooms In many cases, retailers are benefiting #BESTRETAILBRANDS like Audi City, the auto brand’s new from working with partners to help digital car showroom format that uses innovate their offer and make it S UmmARY state-of-the-art technology to make more relevant, differentiating, and clever use of precious city space. Under valuable. By making purchasing easier, Building a digital presence is no longer lens. Consumers, meanwhile, are Armour’s shop in Shanghai employs stepping up service, using storytelling, an “extra”—it’s a must. From mobile looking to integrate their physical “storytailing”—a new way of conceiving and integrating the physical and shopping and augmented reality and digital worlds into a seamless shops as 80 percent story and 20 virtual, brands are reimagining the apps to virtual storefronts and fitting experience that will allow them to get percent store. Hointer, the Seattle- “final mile” and creating unique rooms, retail brands are reimagining the benefits of value and convenience based high-tech apparel store that uses experiences for consumers that the customer journey through a digital wherever they are. robots to deliver jeans to fitting rooms, convert browsers into buyers. has deftly merged the physical and • Retailers must master mobile to • Social technologies present a key digital. Showing the way forward for Branded service innovation is the key to it make purchasing easier, step up opportunity for retailers to build brands that must adapt in the age of all, which means designing experiences service, emphasize storytelling and relationships with their consumers Amazon, Hointer is now helping other that capture the core idea of a brand and personalization, and integrate the retailers disrupt and reinvent the world bring it to life across the entire customer physical and virtual to create better • As traditional retailers go of shopping with technology. Digital journey. The experiences retailers create customer experiences increasingly virtual, digital players, on the other hand, will also be must work at each touchpoint—and also players are building up their building up their physical presence as in combination—to constantly reinforce • Innovative digital shopping physical presence illustrated by eBay’s click-and-collect the brand and build value for customers, experiences like virtual shelves, deal with Argos and Google’s 2013 staff, partners, and shareholders alike. storefronts, and fitting rooms Winter Wonderlab pop-up stores in the are accelerating

20 Best Retail Brands 2014 Scte or overviews

A cross-regional look at trends, innovations and opportunities for seven key retail sectors

To remain relevant in an increasingly competitive marketplace, top brands in the apparel, consumer electronics, department store, grocery, home improvement, drugstore, and mass merchandise sectors are experimenting with technology, exploring new formats, and creating meaningful experiences for their customers. As apparel category leaders continue to explore the use of technology in their retail spaces and improve service across channels, they are well-positioned to maintain their market shares.

24 Best Retail Brands 2014 Despite the extra supply chain inventory, it is available to sample, T rADITIonal stores scrutiny, traditional brick and mortar highly relevant, and affordable. By brands continue to build flagships as serving a narrower consumer base with expand, e-commerce exciting destinations and high-volume more specific needs and desires, these performers, move into new areas, and young brands are delivering high returns innovates encourage sharing through social media to their investors. marketing efforts. Hering will expand into kids’ clothing, Mango plans to One particularly clever brick and mortar push into plus sizes, and Bershka hopes innovation comes from Hointer, a The remarkable success of apparel to see success with exclusive wardrobe retailer that makes shopping for jeans a maximizing capsule collections. Asia’s breeze, especially for men. In Hointer’s retailers can be attributed to scale biggest clothing retailer, Uniqlo, has Seattle pilot store, shoppers use their ambitious goals to become the world’s smartphones to scan a floor sample rather than any unique associations largest retailer by 2020—with or without instead of rummaging through racks and a big acquisition. shelves. The app directs the shopper to a with their brands. H&M alone has dressing room where the appropriate size over 3,000 stores in 53 countries and For the past several years, innovations is delivered robotically within 30 seconds. in the apparel category have come from A purchase transaction can be completed continues to increase its number of online-only companies, such as fashion on a tablet in the fitting room. Store eyewear retailer, Warby Parker, and expenses are minimized and shopper

stores by 10 to 15 percent annually. Bonobos, known for superior fitting convenience is maximized. el App slacks. While such retailers have limited

By the end of 2014, it will have three a multi-storey flagships in Manhattan r in an apparent attempt to capture

#BESTRETAILBRANDS market share from competitors like Zara and Forever 21.

The remarkable success of apparel and cost-effectively, continues to keep retailers can be attributed to scale rather prices low and inventory fresh. than any unique associations with their brands. H&M alone has over 3,000 While there have been rumblings of a stores in 53 countries and continues to slowdown in fast fashion growth due to increase its number of stores by 10 to 15 lack of sustainability and unfair/unsafe percent annually. By the end of 2014, it labor practices, consumer spending will have three multi-storey flagships in has not slowed significantly so far. Manhattan in an apparent attempt to Nevertheless, in the wake of garment capture market share from competitors factory disasters in Bangladesh, most like Zara and Forever 21. notably the 2013 factory collapse at Rana Plaza that killed more than 1,000 people, Beyond real estate dominance, these global fashion companies—from H&M big players ably manage to stay on and Inditex to Primark and Tesco—pulled top of trends while feeding shoppers’ together to sign the Bangladesh Fire and social media appetites. The fast fashion Safety Accord. Many of these same brands model, in which companies design and have also won green plaudits for pledging manufacture their own product quickly to detox garment production.

26 Best Retail Brands 2014 Apparel Innovations and Online players need stores too Opportunities A growing number of online companies believe the future of retail is at the A mobile app that puts a new spin intersection of brick and mortar and on showrooming e-commerce. For example, Bonobos, Japan’s largest online fashion brand, an online technology-driven men’s Zozotown, launched a mobile-social clothing brand, opened Guideshops in app called Wear to drive fashion lovers eight U.S. cities. These Guideshops, or into stores by leveraging data from its 5 showrooms, enable consumers to sample million consumers and 500,000 product and later purchase online. By increasing code numbers from its merchants. Wear real world interaction with customers is described as a mobile Facebook for through showrooms, kiosks, and pop-up fashion. Users share one another’s looks shops, online players are not reverting for inspiration, create wish lists, and scan to a traditional offline model, but rather the barcodes of items they find in brick using offline to enhance the overall and mortar stores to share or purchase. customer journey. If purchased on Zozotown.com, the showroomed store gets a commission. An entire lifestyle revolving around a brand Shoppable store windows, Taking the idea of a flagship one

immediate delivery giant step farther, Urban Outfitters el App In partnership with eBay, Kate Spade unveiled plans for a 6.5 acre “lifestyle

Saturday experimented with interactivity experience” in Pennsylvania, similar a r and same-day delivery via 24/7 “window to the “mini-cities” developed by IKEA. shops” placed in vacant stores in New It will feature Urban Outfitters and York. Shoppers made their selections Anthropologie stores, a Terrain garden from a touch screen, entered their center, eateries, and a boutique hotel. phone numbers, and a messenger was In a world in which consumers are faced #BESTRETAILBRANDS dispatched with their goods for which with a plethora of choices every time they they paid upon delivery. shop, apparel brands that go the extra mile to deliver service, convenience, or an extraordinary experience will gain competitive advantage.

28 Best Retail Brands 2014 Although the biggest still have name recognition, the traditional department store format is largely fading away. As a group, the category is perceived as lacking in innovation, relevance, and youthful appeal.

30 Best Retail Brands 2014 Wean k i Mature Markets, Strong in Developing Economies

Retail analysts in North America have long had department stores on the endangered species list. Given the very public decline of JCPenney and Sears, it’s tough to imagine how these legendary retailers will be able Department store to recover. While the remarkable performance of Macy’s can be attributed to its unrelenting focus on brand, clarity, and relevance, it’s also likely

#BESTRETAILBRANDS picking up the slack from its fallen

competitors. Macy’s now dominates the By strategically expanding in Asia, enables cash advances to cardholders. department store brands such as Falabella also has its own bank, department store category in the U.S. Indonesia’s Matahari—Southeast Asia’s tapping into a niche market of lower- largest department store operator— income consumers with scant access to are seeing strong growth. The SM traditional lines of credit. Even though its brand value slipped a bit Venerable British retailers Marks & retail group is a top department store this year, Nordstrom remains in a class Spencer and Debenhams, meanwhile, operator in the Philippines and China, In general, department stores react by itself, catering to the moneyed crowd saw little growth in their European with enormous potential to expand its more slowly to trends than specialty with exceptional service. Not afraid to stores. In fact, for the first time, Marks footprint. High smartphone penetration retailers. The format is still distinguished adapt to changing times, Nordstrom has & Spencer’s 2013 profits were eclipsed by throughout Asia continues to energize by a high level of departmentalization, altered its merchandise mix to attract a rival Next, which already boasts a higher the category, along with the population’s which makes it difficult to create a younger demographic and is preparing stock market value than the 130 year-old strong affinity for social networking. unified brand experience. However, its New York flagship debut. By getting retailer. Department store growth is also The ensuing rapid spread of information rather than attempting wieldy chain- bricks and clicks to work hand-in- flat in markets such as Japan, Australia, influences preference, which, in turn, is wide implementations to address glove, the U.K.’s upmarket department and Korea, indicating the need for fresh feeding aspirations and driving demand. this issue, department stores would store, John Lewis, gets plaudits for its brand appeal to new consumer segments. benefit more from experimenting with performance—the brand managed to Yet there are bright spots. South America’s biggest retailer in terms brand experience in individual stores. beat analysts’ expectations for the fifth of market value is also a department store While the category is bouncing back Christmas in a row in 2013. brand: Falabella. It may be a century somewhat, getting the “fleet” to deliver old, but it’s not showing its age. It the energy and initiatives of the flagship competes on the loyalty created through remains a challenge. its installment-payment store card which

32 Best Retail Brands 2014 Department Store Innovations and Opportunities

Flagships make a comeback Small risks, displays that pop The department store model can Some department stores are using “pop- only work if it plays to its strengths. in” stores, the in-store version of the That means a finely curated mix of short-term “pop-up” format, to generate options that keep shoppers in the store excitement and traffic. One successful and an experience that makes them feel 2013 collaboration saw the über cool valued and included. A new era of high- I.T Group, the unique Hong Kong-based profile flagship storefronts in city centers fashion house, “pop in” to Selfridges have made brick and mortar exciting London with an exclusive collection of once again, and the internet has helped seven streetwear brands. Additionally, boost the reach and appeal that such with more in-store emphasis on design places lost to the suburbs decades ago. than ever before, window display Nordstrom’s planned Manhattan artists are reaching new creative heights flagship store, for example, fits in their efforts to impress customers. this new integrated retail model. Clever interactive digital window

displays, striking art installations, and Department store Adding new brand dimensions live tableaux such as designers dressing Retail innovations often include models, swanky evening parties, and service features that fit the brand, other provocations behind the glass are suit the audience, and even benefit pulling eyes away from mobile devices. the community. Debenhams decided to answer its shoppers’ question “What Tearing down remaining silos should we do this weekend?” by offering a Aiming for a complete convergence of ticketing service for anything from music online and in-store, Macy’s no longer and theater events to beauty treatments. breaks out web sales from store sales It adds another dimension to the brand’s when it reports financial results. #BESTRETAILBRANDS “life made fabulous” promise. Macy’s believes the old method of financial reporting does not accurately capture the movements of today’s shopper. Hundreds of its stores already ship web orders to consumers, eliminating the need for separate online fulfillment centers, while it’s also testing in-store pickup of online orders. In its drive to leverage its stores and online channel, the brand’s robust mobile initiatives are also helping Macy’s achieve omnichannel dominance.

Image courtesy of Nordstrom, Inc.

34 Best Retail Brands 2014 While the traditional drugstore format continues to carry health and beauty products, the pharmacy is moving away from simple prescription dispensing to an active healthcare service function.

36 Best Retail Brands 2014 convenience and transparent pricing of by smartphone, manage one’s rewards Aa d ptINg to aging in-store clinics will present an attractive program, or send pictures to in-store alternative for consumers seeking health photo centers for printing. Customers populations and the care and solutions. who engage with Walgreens online and via mobile applications spend six times growing demand for In Asia, Australia, France, and Germany, more than those who only visit stores. the drugstore sector is divvied up among health service smaller players and independently The end of the printed circular owned shops. Language barriers, To reach a younger demographic and cultural differences, and regulatory prepare for a future without printed hurdles continue to keep many global sales circulars, CVS/pharmacy took a big Two critical market trends continue brands from entering these markets and step forward in online personalization. consolidating, but the presence of so few Data gathered from loyalty cards to impact the growth of the drugstore truly regional brands signals opportunity. generates a customized version of weekly sales, savings, and rewards. category. First, is the world’s aging The U.K.’s Alliance Boots, in the midst A potential downside to consider: With of acquiring Walgreens, inked an such personalized ads, some shoppers population, which is accompanied by agreement in early 2013 with generic are concerned they might miss out on rising levels of health consciousness. drug wholesaler AmerisourceBergen— savings if they’re only able to see some,

a deal that brought both companies rather than all, deals. Drugstore (In Japan, for example, sales of adult purchasing power and cost savings. Similarly, in early 2014, McKesson Corp., No place for tobacco products diapers have exceeded sales of baby a leading North American healthcare In many countries, it’s common for services and information technology drugstores to sell cigarettes. But that diapers—and, globally, the probiotics company, acquired Celesio, a Germany- practice may be coming to an end. market is on track to reach nearly based wholesaler supplying 65,000 It is already prohibited in most of pharmacies and hospitals with up to Canada and in some parts of California 130,000 pharmaceutical products. The and Massachusetts. CVS/pharmacy #BESTRETAILBRANDS USD $24 billion by 2017.) Second, there’s union enhances McKesson’s chances is removing tobacco from its stores a rising demand for affordable and of becoming a global leader in drugs to strengthen its image as a distribution. Reflecting a growing healthcare retailer. accessible healthcare worldwide. trend, these examples show how pharmaceutical producers and suppliers A new retail category: are intersecting with retail pharmacy. specialty pharmacy For the past several years, top drugstore more from their drugstores. In response, As retail pharmacies and clinics expand, The use of specialty medications (which chains have been making the front- top brands such as Farmacia Benavides they have an opportunity to play a greater include injectibles and biologic agents) end of their stores more productive and Raia Drogasil are staying open 24 role in the healthcare ecosystem, support for complex diseases such as cancer will with fresh food, redesigned health hours, conducting home deliveries, and the healthier lifestyles of customers, and continue to rise and outpace traditional and beauty departments, expanded offering outpatient services. Shoppers drive down the overall cost of healthcare. (usually oral) drugs. Because patients photo services, more private labels, increasingly count on these retailers for taking specialty drugs face substantial and exclusive offerings. Additionally, information about medicines, living risk for high out-of-pocket spending, major investments have been made in healthier, and new beauty products. Drugstore Innovations and collaborations between retailers, health information technology (HIT) Opportunities hospitals and manufacturers are likely to infrastructure. HIT is helping transform In the U.S., expansion plans for category become more commonplace to reduce cost the pharmacy as it assumes a more leaders Walgreens and CVS/pharmacy, Opportunity in mobile and make administering medications central role in healthcare. driven by the Affordable Care Act, are set When it comes to effectively utilizing more convenient. Walgreens, for to have a major impact on the drugstore mobile applications, Walgreens and CVS/ example, plans to have its retail clinics In Latin America, older consumers and retail market. With physicians expecting pharmacy lead the way. These brands assist consumers in the management of the growing middle class—an estimated to see a surge in new patients—perhaps makes it easy to fill a prescription, shop chronic conditions. 50 percent of the population—want more than many clinics can handle—the

38 Best Retail Brands 2014 Most consumer electronics brands dropped in brand value this year. The category continues to lose relevance as lowest price trumps everything—a sign the industry needs to take retail brand experience more seriously.

40 Best Retail Brands 2014 Traditional retailers are scrambling to Consumer Electronics Th e bATTLE for find ways to transform the expensive Innovations and Opportunities liabilities of physical locations into assets. tmarke share moves The best of them, such as France’s Fnac, Bring online payment options in-store which boasts one the country’s most- RadioShack is allowing customers to t o e-commerce visited retail websites, is adopting hybrid use PayPal as a form of payment in its models by focusing on a competitive (shrinking number of) physical stores. online channel, developing its mobile RadioShack’s shoppers get the same experience, and digitally enhancing the convenience and efficiency in-store As recently as 2009, Best Buy was the in-store experience with features such as they would conducting mobile or as interactive kiosks. Aiming to break online purchases. second most valuable retail brand down all barriers between its stores and its internet and mobile sites, the goal Match competitors’ online in the U.S. after Walmart. Consumer is to be omnipresent. Fnac continues to prices in-store expand its store network, mainly through Based on the fact that it commands electronics was the fastest growing new formats for high-traffic areas (such a market share more than four times retail sector, with Best Buy far out as airports) and smaller proximity format larger than Amazon, Best Buy is banking stores—which all benefit from the brand’s on a comeback. Amazon will soon be front. Two years later, however, weak omnichannel functionalities. charging state sales taxes across half the U.S. market and raising Amazon electronics sales and online competition chipped China’s Suning is working to de- Prime to USD $99, stripping it of some emphasize its consumer electronics of its price advantage. Meanwhile, Best away at the company’s dominion and, image in favor of becoming a multi- Buy claims to be closing more in-store by 2013, Best Buy had lost more than category retailer with a fully integrated sales by immediately matching any online/in-store presence. Like Germany- online price—an attempt to muscle 50 percent of its brand value. This year, based Media Markt, whose stores spread in on Amazon’s share. across 14 countries, Suning is giving itself a makeover in the hopes of Add services to create value

#BESTRETAILBRANDS its brand value drops 42 percent. becoming a “youthful and daring” brand. for shoppers Media Markt only launched its online In Australia, JB Hi-Fi, with its “always The Best Buy story illustrates that many as 14 online sources for product store in 2012 and is busily trying to cheapest prices” and energetically chaotic consumer electronics has become a information before buying and the recover lost ground with younger, brand persona, had a decent year. In mature industry. The sector expects e-tailer that “upended the book industry tech-savvy shoppers. addition to its online/in-store sales of some growth in the Asia-Pacific region and displaced electronics merchants” electronics and appliances, the retailer and softening demand in most developed typically lands high on their search In general, when it comes to retail, has found a way to profit from the demise countries. Korea’s Himart, even with lists. Furthermore, like many online there’s not as much innovation as and consolidation of the traditional a market share of 47 percent and high players, Amazon has enormous pricing one might expect from the consumer music category with the 2011 launch of its awareness, saw its brand value dip in advantages—not just due to low electronics sector. Consumers are liable JB Hi-Fi NOW subscription-based music this year’s report. Retailers around overhead, but also due to its ability to get far more excited about the product streaming service and the 2013 addition the globe face a fiercely competitive to make millions of price changes per itself than they are by the in-store of e-book sales. environment. Ongoing challenges day compared to traditional retailers’ experience they have when actually include waning customer loyalty and thousands a month. These price changes purchasing the product. Expand by creating a franchise shrinking profit margins. have begun escalating at brick and mortar French retailer Darty has charted an stores as retailers fight for consumer interesting new course to steer itself out Online competition—coming primarily dollars. Best Buy, for example, has of the doldrums. With its stores mainly from Amazon—is price-centric and begun matching any online price for the in urban areas, the European electronics notoriously fierce. Shoppers visit as products it sells in its physical stores. giant is exploring a franchising model to extend its multichannel capabilities to France’s 2,000 small independent electronic retailers.

42 Best Retail Brands 2014 Grocery retailers are reinventing themselves according to how consumers want to shop. Trends driving change include mobile technology, home delivery, consumer income disparity, and the strategic necessity of e-commerce.

44 Best Retail Brands 2014 place of happy people.” Rather than Better experience with mobile Fierce competition, priding itself on value or quality alone, technology the brand brings an added emotional Natural Market Food Group, a fast- fragmentation, and dimension to grocery shopping. growing chain of natural/specialty stores in Canada and the U.S., seeks to format challenges In North America, competition from educate and inspire communities to eat nontraditional food retailers—such and live well. At the company’s Richtree as warehouse clubs, supercenters, Natural Market venue in Toronto, which drugstores, and discount retailers—is features 11 different foodservice stations, Grocery retail continues to move blurring the grocery segment’s retail customers can shop from any of the boundaries. In the U.S., price-conscious stations by scanning QR codes with their rapidly away from a one-size-fits-all consumers buy more food from these smartphones. This allows customers to nontraditional retailers than traditional pay for as many other members of their approach to a vigorous search for the supermarkets. Further, the average group or their family as they like—even U.S. supermarket shopper buys only if they are separated within the store. store of the future. While brands are 260 different products per year, ignoring experimenting with new formats, the 99.3 percent of the in-store options. A full suite of digital shopping platforms success of today’s grocery leaders seems If selection is not a real draw and value is Showcasing its leadership in both still top priority, subscription shopping digital and brick and mortar, Big C, with

to be less about format and more about starts to make more sense. Amazon multiple formats in Laos, Thailand, and grocery Fresh and long-time online players like Vietnam, sells its wares via e-commerce, a brand’s style of doing business. FreshDirect and Peapod are filling that mobile app, QR code-based virtual stores, niche—and as they find ways to deliver and call centers. As a result of its strong preferred products profitably on a larger omnichannel engagement strategies, Big In pursuit of the smartphone-savvy, dynamic, modern, and scale, they will further challenge brick C is enjoying a massive increase in sales. city-dwelling consumer who is grappling multichannel. Already, and mortar supermarkets. with inflation and valuing price and Reinvent the center store #BESTRETAILBRANDS convenience ahead of quality, some Aldi has lost ground to As the segment that most closely reflects Giant Eagle is experimenting with an of the largest chains are expanding by competitor Lidl, which economy and society, grocery will in-store greenhouse, using the center getting smaller. France-based Carrefour, has a trendier image continue to evolve as time passes and of its store to grow fresh products for example, is now opening more conditions shift. Based on the macro hydroponically. The coming shift of small-format grocery concepts than and a thriving online trends that are redefining the game, merchandise from in-store to online hypermarkets. In the U.K., Sainsbury’s marketplace. however, the next few years promise will open up opportunities to offer new convenience stores will outnumber its some very dramatic changes. services, experiences, and features that grocery stores by the end of the year. In At the other end of the spectrum, for will enhance the in-store experience. France, there are now over 2,500 drive- those who can afford to pay more, there through supermarket units for consumers are still small regional players offering Grocery Innovations and Making service more personal who shop online and prefer pickup to more upscale grocery experiences that Opportunities The tailored recommendations consumers home delivery. emphasize service, selection, quality, can find so easily online are still missing organics, fair trade, and locally grown Food as a lifestyle destination from supermarkets. Grocers that use German-based Aldi, the foods. Epitomizing this kind of shopping Québec-based Provigo Le Marché, owned technology to inspire ideas around food, experience in Britain, Waitrose opened by Canada’s Loblaw Cos., wants to personal preferences, and occasions— world’s top discount the U.K.’s first supermarket farm shop, nourish shoppers’ joie de vivre through and help shoppers manage their pantry grocery chain, may have which offers produce grown on its a full-service grocery store with a replenishment with mobile data—will be 4,000-acre farm estate, as well as goods distinctive market style layout. It’s an the brands that matter most in the lives to update its business from vendors within a 30-mile radius. expansive showcase for products grown of customers. model from a single In Brazil, premium grocer Pão de Açúcar and made in Québec and supports healthy channel, single format has found another way to stand out in eating through its proprietary nutrition- an undifferentiated function-driven labeling program and on-staff dietician. grocer to one that is more landscape by positioning itself at “the

46 Best Retail Brands 2014 To remain relevant in an increasingly competitive sector, top home improvement brands are creating meaningful experiences for their customers and communities. Shoppers are encouraged, inspired, and supported with service and instruction. Internationally, companies continue to experiment with the best way to expand.

48 a fixture—such as a shelf, reading light, Collect shopper insights continuously M odERATE growth, or closet rod—on the other. As soon as the Leroy Merlin launched a Housing campaign ended, locals were free to use Observatory to identify new trends and immense potential these signs to improve their homes. spur innovations. Insights gained into its customers’ lives will help the brand Bunnings Warehouse continues to inspire its customers, stay relevant, capitalize on Australia’s fascination with and adapt to local markets. The global home improvement market home improvement. Recently recognized as one of the country’s most trusted Differentiate via display techniques is growing. Mexico is emerging as brands, it has built its reputation on Recognizing that big box home community and authenticity. This year, improvement stores can be hard a fertile and important market, Bunnings took a big, much-needed step to shop, U.S.-based Lowe’s has changed in developing its e-commerce channel, is merchandising strategy to focus on thanks to its growing middle class. bringing it more in line with the brand’s highly innovative products, significant The Home Depot, the leading home in-store experience. An omnichannel values, and its exclusive private and presence will help Bunnings compete national brands. To remain relevant improvement retailer in the U.S., is against new entrant, Masters Home and drive high-margin sales, the

Improvement, a joint venture between retailer also revamped its seasonal improvement Home strengthening its existing operations Woolworths and U.S.-based Lowe’s. promotional spaces.

south of the border in the expectation While promotions and low-price offers Dynamic price tags lure shoppers that Mexico is projected to add 14 are still the norm, brands in this sector are putting more effort into developing French DIY chain million homes over the next 25 years. emotional connections with consumers Castorama is using to take advantage of the “IKEA effect,” the high value consumers place on products dynamic price tags to Despite global opportunity for the sector presentation style. Besides the usual they partially create and projects they do change the price of a based on population growth and an home improvement tools and supplies, themselves. High service levels are a must #BESTRETAILBRANDS product based on demand increase in dual income families, The the store also carries home furnishings, as is mobile technology, which gives Home Depot has only been successful ensuring that any household project— customers and store associates access to and time of day. Not only in North America. It found its big box from renovation to redecorating—has a more products and information. Overall, is the task of manually format to be a logistics challenge as high probability of ending in a shopping the global home improvement retail well as a cultural mismatch in both trip to Leroy Merlin. market will continue to grow, while its adjusting price stickers China and South America. In China, for leading players get even better at meeting eliminated, the electronic example, consumers aren’t particularly The biggest home improvement brand in consumer demand. interested in DIY, how-to videos, or in- Asia is Thailand’s HomePro. It stands out tags can be changed store remodeling forums. After closing its in an increasingly competitive market in real time. Items can Home Improvement Innovations big box stores in the country, the chain with an extensive footprint, as well as be made cheaper during is now shifting its focus to e-commerce a commitment to meaningful customer and Opportunities in the hopes of winning over younger service that helps do-it-yourselfers make off-peak hours to Chinese customers. more informed choices and get better Engage the imagination with 3D encourage shoppers results. It builds community through visualization In Latin America, France-based Leroy its quirky advertising as well as clever Latin America’s Sodimac created a mobile to visit at those times. Merlin is one of the largest home promotions like The Other Side Project, app that lets shoppers view its catalog in improvement brands based on sales, which was created to help local poor 3D. Thailand’s HomePro helps aspiring even though it has fewer stores than people who use sidewalk billboards to home improvers via its in-house design competitors C&C, Telhanorte, and build or repair their street shelters. In consultation service, which features a Sodimac. Leroy Merlin credits its this dual-purpose campaign, HomePro 3D system for improved visualization. success to a rich merchandise mix, its created billboards with its advertising online channel, and a clean, unique message on one side, and wallpaper and

50 Best Retail Brands 2014 Consumers still love big, everyday- low-price stores filled to the rafters with consumer goods and groceries. But behaviors are changing. Mass merchants must fight harder to attract the low-income and fixed- income shoppers that built some of the world’s biggest retail brands.

52 In Australia, the mass battle is brewing Mass Merchandise Innovations Tnaki g the store online between three players that make the and Opportunities list: Big W, Target, and a recently and into smaller boxes reinvigorated Kmart (the latter two, not Expand into new categories to be confused with their North American Besides its famous experiment with counterparts, are locally owned and same-day delivery via drones, Amazon operated in Australia). All three have made news by adding a number of You know it’s a tough year for mass potential to improve their experiences niche stores, including flowers and online, where they face increasing fine art, to its e-commerce empire. merchants when Walmart, the competition from direct competitors The online retailer also made it easier and other e-tailers. for consumers to find and manage world’s most valuable retail brand, magazine subscriptions with its new One of the brightest spots in mass can one-click feature. drops a few percentage points in be found in South Korea at emart. brand value. Walmart faces the same The retailer doesn’t have a cookie-cutter Augmented reality, digital beacons format but every location seems to be Argos began life as a catalog-based challenges as its peers around the neat, colorful, and lively. Its electronics retailer, and then pioneered the click- megastore in Seoul’s Yongsan district and-collect format in the U.K. This year,

globe: price competition from pure has nine levels, each floor dedicated to a it introduced digital concept stores— merchant mass single category such as cameras, TVs, or where tablets take the place of catalogs— e-commerce brands—in particular, computers. Advertising and promotions so items can be selected in-store, picked Amazon—and the growing popularity are both clever and whimsical. up, and paid for in minutes. For those who order online, Argos is testing the of small-box discount stores in the Recently, emart sent use of short-range wireless to inform customers when orders are ready to dollar and convenience categories. remote-controlled be picked up. To make the experience helium balloons with more engaging, the catalog also features augmented reality. #BESTRETAILBRANDS For the past several years, Europe’s mass revamping its site search capabilities to Wi-Fi capability out leaders Carrefour, Auchan, and Casino raise conversion rates by 20 percent. into the streets. These Add some high-end excitement have been exploring new formats for balloons, in the shape of Following a series of acquisitions that their hypermarkets in combination Generally, traditional mass retailers have have made it the biggest sports retailer in with smaller stores and new services. been slow to make their online channels the company’s mascot, Canada, Canadian Tire opened “ProShop” Carrefour City, Auchan’s A 2 pas, and as effective and efficient as their brick enabled customers to mini-boutiques in 50 of its big box Petit Casino respond to local markets and mortar stores. Kaufland, Germany’s suburban stores, including higher end, and serve shoppers close to home, saving leading hypermarket brand, is a relative wirelessly download higher margin merchandise from rival them transportation costs. Traditional newcomer to TV advertising and engaging coupons via the brand’s retailer Sport Chek. big box formats have also been redesigned its customers in social media, but will for better shopping experiences, some not launch e-commerce until 2015. With mobile app. The delightful Tap into employee and customer with drive-through options. Amazon launching grocery delivery in experience led to a surge creativity Germany, Kaufland’s online experience in online and offline Auchan has put innovation at the center In North America, small-format stores will need to be best in class. of its business strategy. Its “Creative have proliferated to take advantage sales, with a 157 Attitude” crowdsourcing initiative solicits of new shopping habits. Low-income Lojas Americanas wants to be Latin percent increase in the thousands of ideas from employees shoppers, unsure of the next paycheck, America’s Amazon, and has invested and customers for improvements and typically make more trips closer to home heavily in e-commerce to complement its e-commerce channel. product suggestions, with the best ideas and spend less per trip. In response, brick and mortar and catalog channels. implemented in its stores. Walmart has doubled the number of The brand developed its own scalable 12,000-square-foot Walmart Express logistics system, able to deliver orders in stores it plans to open. It’s taking 48 hours throughout Brazil. an offensive stance online as well,

54 Best Retail Brands 2014 REGIONAL OVERVIEWS -6% +8% +12% +27% +12% nt or h AMERICA $131,877M $27,123M $25,696M $23,620M $17,779M

+8% 0% +20% -21% +2% $15,519M $13,543M $13,162M $11,588M $10,157M While e-commerce sales continue to grow 10 percent each year and some sectors are facing definite challenges, traditional North +9% -12% +13% +8% +2% $9,634M $8,957M $8,286M $7,711M $6,249M American retailers remain strong. Nearly all brands in this region offer competitive pricing; convenient purchasing and payment +383% +3% +5% -11% -41% options; a pleasant shopping experience; $6,084M $5,825M $5,440M $4,931M $4,793M offerings that are meaningful and relevant; and demonstrate that they understand the +7% -11% +173% +5% +6% complex relationships between analog and $4,669M $4,610M $4,166M $3,920M $3,860M digital, retail and the shopper.

+15% +15% -5% -13% +16% $3,214M $3,118M $3,111M $3,087M $2,444M

-8% +22% +4% +19% +3% $2,336M $2,123M $2,035M $2,028M $1,868M

+10% +2% -3% +7% +14% $1,812M $1,795M $1,760M $1,528M $1,496M

+16% +7% +8% +17% -5% $1,492M $1,421M $1,294M $1,183M $1,122M

NEW +6% +27% +15% NEW $1,109M $1,082M $1,066M $983M $932M Amazon itself continues its relentless Drugstores must become health No rth America overview growth to become “the everything care providers store.” While CEO Jeff Bezos considers his brand to be without competitors, In the U.S., health clinics inside retail By Lee Carpenter, CEO, Interbrand North America & most retailers have come to see they are chain stores have doubled over the last Dirk Defenbaugh, Managing Director, Interbrand Design Forum locked in battle with the e-commerce six years led by CVS, the pioneering juggernaut. Analysts predict Amazon cigarette-quitting pharmacy giant that will soon carry more than 85 percent plans to have 1,500 in 35 states by 2017. Rebounding from five years of economic of the product sold at leading retailers, Walgreens, meanwhile, is projecting at better prices, with more delivery double-digit growth, confident that turmoil, technology changes and altered methods and payment options. simple care delivered by licensed pharmacists and nurse practitioners consumer behaviors, North America’s Today a fully functional mobile presence will increase trips and spend. is a given for every brand. Knowing this, leading retailers are still recovering The Home Depot has armed its store The Patient Protection and Affordable their balance, making major moves to associates with handheld technology to Care Act drove this year’s retail help them track inventory, aid shoppers, expansion plans in the U.S. As more reassert their relevance. The mad race to and share new problem-solving tips both consumers obtain insurance coverage,

in the store and online as a result of that an inevitable shortage of physicians, america North throw money at e-commerce, apps, QR shopper interaction. It conveys the “more in conjunction with the convenience of doing” brand essence while adapting store hours, makes retail an attractive codes, and interactive screens has come to a customer’s particular needs in real alternative to slow traditional systems. to an end. “Omnichannel” is already time. The Home Depot remains ahead Even in Canada where residents have of Amazon in brand value this year. received publicly financed health care an old buzzword. This new reality has led to a rise in “connected stores for

#BESTRETAILBRANDS connected customers” as evidenced by our top 50 North American brands.

This year, the total value of the top Digital is no longer a separate 50 North American retail brands is conversation up slightly, by USD $18 billion, with striking increases in value by Macy’s The North American retail brand with and Whole Foods Market. The threshold the greatest percentage increase in brand for the league table rose 11 percent value this year is a master at achieving compared to last year. relevance at scale. Macy’s is recognized as something of a hybrid superstar. With While e-commerce sales continue to bona fides in both digital and brick and grow 10 percent each year, questions mortar, it has set the standard for highly about the role of brick and mortar seem personalized shopping, harnessing to be largely resolved. The store is now some of Amazon’s key strengths while a brand experience that drives revenues heightening the in-store experience. across all channels.

60 Best Retail Brands 2014 since the 1960s, Walmart Canada targets Hudson’s Bay Co. will bring Saks Fifth shoppers through its nearly 30 retail Avenue north in late 2015, making health clinics, anticipating a need for some of America’s favorite brands more easier access to convenient medical care continental than national. Within as the population ages. Canada’s borders, grocery giant Loblaw Companies Ltd. shook up the retail scene Fashionable mass merchant Target also by paying USD $12.4 billion to acquire houses retail health clinics in about 70 Shopper’s Drug Mart 1,250+ stores, many of its stores in the U.S. Target stopped of them in profitable urban locations. selling cigarettes in 1996 without crippling its bottom line, which suggests It was once said there were only three that CVS will recover from the USD kinds of retailers: those that compete on $2 billion loss it expects after removing price, those that compete with a unique tobacco from its stores this year. The experience, and those that can’t compete. move will strengthen CVS’s image as Now even dollar stores are improving a healthcare retailer. Pressure is now their environments with offerings that certainly on Walgreens, with its “Happy & are meaningful and relevant. For the Walmart Healthy” brand promise, to do the same. brands on our list, actions based on USA lessons learned from the last five years Mass Merchant are paying off. There’s a greater $131,877M -6% Increased cross-border activity understanding of the complex and challenging relationships between Target arrived in Canada this past year, analog and digital, retail and the It’s been a tough year for the world’s bribery probes, as the retail giant has with Nordstrom planning its own shopper. Judging from the overall biggest retailer. Its U.S. stores reported struggled internationally, closing stores cross-border activity beginning in the increase in brand value, consumers sluggish sales as customers cut back or in Brazil and China and reassessing its fall of 2014. Canadian retail icon The are rewarding those actions. turned to dollar stores. Stuck with excess India strategy. With a new U.S. CEO inventory, it trimmed orders and staff, (Douglas McMillon) and international even while expanding domestically with CEO (David Cheesewright) to get the smaller stores in urban areas. The U.S. business back on track, it’s also investing S UmmARY is still its strongest market, one that’s in mobile, smaller stores and e-commerce seemingly impervious to negative press to keep up with the 10 percent annual • Online retail is rapidly taking • Health clinics inside retail chain such as wage protests at home or internal growth rate of U.S. online spending. share in many retail categories, stores have doubled over the last six led by Amazon years, with CVS—which, notably, Target will drop tobacco from its stores— USA • A mobile presence is a must; the leading the trend Mass Merchant new omnichannel reality has $27,123M +8% given way to “connected stores for • Electronics retailers are facing connected customers” increased pressure due to showrooming; department stores Never mind catching flack for refusing and Monster on an exclusive headphone are facing challenges—but increased to sell Beyonce’s album. The biggest design, and introduced a family-friendly cross-border activity may lead to challenge to Target’s brand in the past movie streaming service. Rounding out a gains for brands like Target year was the massive data breach during busy year, it also launched a subscription the holiday season, which sent store service for baby goods, acquired CHEFS traffic and confidence plummeting. Yet Catalog and Cooking.com, and opened the brand stayed true to its reputation for 120-plus new stores in Canada—where creativity and innovation. The retailer it’s still finding its footing. Coming soon partnered with Wired magazine on a in the U.S.—Target Express, a quick-trip curated line of electronics, collaborated store format, and more secure pin-and- with Latin music producer Emilio Estefan chip Redcard technology.

62 Best Retail Brands 2014 The Home Depot Walgreens USA USA Home Improvement Drugstore $25,696M $15,519M +12% +8%

The DIY retailer surprised Wall Street private labels differentiated the brand Walgreens is shifting its brand image, community. In the long-term, that with impressive sales and earnings, not from competitors. Expanding beyond store design, and inventory to better means a renewed focus on its in-store just maintaining its lead in a fragmented its core home improvement customer compete with rival drugstore brands, as pharmacy, immunizations, clinics, category serving an ever-fluctuating base, it successfully introduced services well as Walmart and Amazon. However, vitamins, as well as beauty and skincare market—but thriving. Credit strategic to support contractors, with professional rather than making sweeping changes offerings. Helping position it for growth, use of key assets: store location, tech business and construction now across its 8,500+ U.S. locations, the brand 2013 net earnings soared thanks to success innovation, and in-store moves including accounting for 35 percent of sales. On top is proceeding with care. The “general in the company’s pharmacy business, lower pricing, simpler merchandising, of its commanding brand presence and merchandise with pharmacy” format its loyalty program, and its new 10- and improved customer service. impressive agility, The Home Depot has is slowly transforming into a health- year distribution agreement with drug Investments in digital retail systems succeeded in responding to marketplace and-wellness experience, in which the wholesaler AmerisourceBergen to help significantly increased in-store purchases changes, climate fluctuations, and pharmacy is perceived as part of the offset pressures from generic drugs. this year, while well-managed exclusive consumers’ changing needs.

Amazon Sam’s Club USA USA Mass Merchant Warehouse Club $23,620M $13,543M +27% 0%

The world’s biggest e-tailer saw 2013 net video service (with a streaming set-top Walmart-owned Sam’s Club has over in-store Wi-Fi capability, expanded self- sales increase 22 percent, even while box in the works), it’s becoming a 47 million members and serves over checkouts, and convertible cash registers, it lost a staggering USD $3.5 billion on force to be reckoned with in the 600,000 small business owners every day. as well as new brands and ways to save. shipping—which it aims to address entertainment industry. While its storage The warehouse club has been focusing The retailer’s mobile app, Scan & Go, by hiking the cost of Amazon Prime lockers with other retailers met with on innovation to make the shopping differentiates its shopping experience membership to USD $99. It also made mixed success, its presence inside P&G experience more efficient, especially for by allowing customers to scan and headlines with its plan to test same-day and other CPG partners’ warehouses small business owners, by offering small total their own purchases as they shop. delivery via drones, showing its focus helped reduce costs, while it’s continuing business loans, invoice comparison, Transitioning gracefully into the digital on innovation and long-term thinking. to build infrastructure for same-day instant savings, and earlier hours. era, Sam’s Club has managed to remain Expanding into online advertising and delivery of perishables. For general consumers, it’s promoting a top retailer by adapting to changing original programming for its streaming e-commerce and mobile apps, greater times and changing customer needs.

CVS/pharmacy eBay USA USA Drugstore Mass Merchant $17,779M $13,162M +12% +20%

Its network of more than 7,600 stores its parent company have boosted sales Faced with competition from the likes glass storefronts to a mall in San gives CVS/pharmacy a competitive online and in-store. Ever-evolving private of Amazon, Google, and Apple, eBay is Francisco and partnered with Kate Spade edge throughout the U.S., making it labels continue to improve front-of- shaking off its established role as the Saturday to bring 24-hour shoppable pop- the nation’s second-largest pharmacy store margins, while its MinuteClinic web’s communal auction house and up storefronts to New York, showcasing chain. Shopper research is helping the format holds the lead in the retail clinic merchant partner. Its aim: to be a global its mobile tech, same-day delivery brand improve adjacencies and localize space. With pharmacy making up 70 commerce platform and payments leader via eBay Now and its mobile payment assortments in its brick-and-mortar percent of sales, CVS is looking for that enables shopping and transactions solution, PayPal Here. With a zeal for stores, while city locations are being ways to help customers achieve health virtually anytime, anywhere. It’s a innovation and a willingness to reinvent updated. In addition to gaining consumer goals, including its recently announced grand, but achievable, goal. Proving it itself, and a global mobile commerce insights, profitable long-term pharmacy landmark ban on cigarette sales. can create exciting end-to-end customer advantage by owning PayPal, eBay looks benefits management contracts won by experiences, in 2013 it brought connected poised to fend off its formidable rivals.

64 Best Retail Brands 2014 Coach Nordstrom USA USA Apparel Department Store $11,588M $8,957M -21% -12%

Fierce competition has knocked Coach company plans to expand in online The specialty retailer known for high- hip, quirky online campaign, Youphoria. off its perch, and the brand was slow to sales, men’s collections, and its overseas end merchandise and impeccable service New “of the moment brands” are being respond when its customers migrated markets—holiday sales were up 25 percent improved its brand experience with sold at lower price points. The retailer to competitors like Michael Kors, Kate in China—but must address the fact digital tablets in-store, 3D imaging also shifted attention to its off-price Spade, and Tori Burch. Unexpected that customers are flocking to its outlet software to aid online shoe fitting, and Nordstrom Rack division, expansion weakness led to a change in leadership stores. Despite falling sales, Coach will “pop-in” stores described as in-store into Canada, and its upcoming New York and a parting of the ways with creative open 20 new stores in North America and celebrations with different themes, flagship debut, slated to open in 2018. director Reed Krakoff. To recover, Coach expand 20 more, displaying its bags in the such as French designers. To attract its Soft sales in its full-line stores, of which is transforming itself into a lifestyle context of new outerwear and ready-to- key demographic of men and women only one opened in 2013, were offset brand. Besides adding categories, the wear offerings. aged 25 to 35, Nordstrom partnered with by strong direct sales and increases at Bonobos and Topshop and launched a Nordstrom Rack.

Publix Co sTCo USA USA Grocery Warehouse Club $10,157M $8,286M +2% +13%

Since 1930, the Publix brand has been to economic conditions and consumer Costco is the world’s dominant service and Corporate Citizenship, recognized for excellent customer service research and trends. Recognizing the warehouse club operator, with more than including respect for suppliers, livable and stellar employee treatment. In need for a quicker and more efficient 72 million members worldwide and record wages, and health care for its employees fact, only employees may own shares shopping experience, tests continue for sales in 2013. Despite limited marketing, (it’s one of the few retailers to support in this privately held company. Fortune an online/mobile ordering system that Costco’s store experience and product mix raising the minimum wage), Costco also magazine has named Publix a “Best will reduce long wait times at its deli keeps demand for its quality, low-priced rewards shareholders. Perhaps because Company to Work for” for fifteen years counters. Overall, its competitive pricing, goods high. It has opened 26 warehouses of its overall strength, the brand appears running, citing educational and training highly refined private label program, in seven countries and continues its untarnished by recent legal tussles with opportunities among other perks for and community involvement keep expansion—next stop, Spain—while the Michael Kors, Tiffany & Co., and the employees. In addition to looking after shoppers loyal and happy, leading—not U.K. and Mexico can now shop Costco settling of a gender-bias class action suit. its employees, Publix pays close attention surprisingly—to an increase in 2013 sales. online. Known for excellent customer

Lowe’s Dollar General USA USA Home Improvement Dollar Store $9,634M $7,711M +9% +8%

The home improvement giant delivered tagline and its internal call to action for Dollar General is the clear category leader and fixed-income shopper. It also entered consistently on its brand promise while innovating and improving the brand when it comes to presence, even though a new line of sales this year, testing a fuel growing in both financials and size, experience, which it did by improving its the no-frills experience continues to lack offering in partnership with Mansfield although it’s still trailing its rival, The MyLowe’s online project management true differentiation from its competitors. Oil. Dollar General continued to sponsor Home Depot. This past year Lowe’s tool, along with the mobile technology This extreme-value, small-box player NASCAR and invest in community acquired 72 stores from Orchard Supply that allows employees to spend more time ended 2013 with strong numbers, a bright programs for youth education and Hardware, a purchase that boosted with shoppers, strengthening the brand outlook and more than 11,000 stores in literacy, but was hit with fair labor and sales in California, home of the small- value of partnership with the customer. 40 U.S. states. Spurred by sales of tobacco discriminatory lawsuits, which may format neighborhood stores that will Lowe's continues its commitment to and grocery, its stores saw more traffic negatively affect its brand image, and complement Lowe’s big box strengths. energy efficiency and was named Energy from the brand’s targeted low-, middle-, possibly employee engagement. “Never Stop Improving” is both Lowe’s Star of the Year.

66 Best Retail Brands 2014 Victoria’s Secret Tiffany & Co. USA USA Apparel Jeweler $6,249M $5,440M +2% +5%

Despite increased competition in the are routinely consolidated, and new Following up a celebrated 175th ring and a reinterpretation of its iconic women’s intimates category and a soft openings are carefully considered. The anniversary year that saw new Atlas collection. Steadily expanding market for apparel, Victoria’s Secret 120+ franchised beauty and accessory collections, global expansion, and internationally, the brand opened 28 shows no sign of weakness. The brand shops in airports from Kuala Lumpur Hollywood exposure via Baz Luhrmann’s stores in Brazil, the Czech Republic, and reported comparable store sales growth to Athens generate double the chain The Great Gatsby starring Leonardo China—all growth markets. It is also thanks to creative product offerings, average. And, after nearly 20 years, the DiCaprio, Tiffany & Co. exceeded opening its largest European boutique, widespread media exposure, and a Victoria’s Secret annual fashion show performance expectations in 2013. As part a multi-story flagship on Paris’ Champs- dynamic online presence. Its fleet of still captivates audiences. Even a protest of the year-long celebration, the iconic Élysées. Not surprisingly, Tiffany & Co. 1,000+ stores in the U.S., Canada, over the store’s racy PINK spring break luxury brand also renewed its two-decade shares are performing well, prompting and the U.K. are smartly managed collection led to a bump in sales after the long collaboration with Italian designer Forbes to declare in an admiring headline, for productivity, underperformers collection was pulled. Elsa Peretti and introduced the Ziegfeld “Tiffany Looks like a Jewel for the Bulls.” collection, the Harmony engagement

Macy’s Sat ples USA USA Department Store Office Supplies $6,084M $4,931M +383% -11%

Macy’s continues to work its magic, America’s Omnichannel Store. Adopting Following a profitable decade, Staples is Internet Retailer listed it second from the defying forecasts for the death of a “digital hybrid” model, Macy’s uses firmly established as the office supply top in its U.S. e-commerce rankings, department stores with three consecutive technology to create a tailored shopping leader in North America and Europe, and indeed Staples has prioritized its years of significant sales growth. experience within an environment that and making headway in South America, continued online growth. Building its Indicative of its strength, its brand value is fashion-forward, celebrity-infused, Asia and Australia. The second-biggest reputation as an upstanding Corporate rose again by a large margin. Macy’s is and luxurious. To grow its brand, Macy’s online retailer in the world expanded its Citizen, its Staples Soul platform aims indeed a leader worth studying for its is elevating the store experience and inventory (from 70,000 to 300,000 SKUs) to both differentiate and establish strategy and the relentless dedication pushing into new areas via its USD $400 in the past year, a fact it’s playing up in a the brand as socially conscious with a that brings the brand to life. Referring million Herald Square flagship renovation social media-savvy campaign (What’s the positive impact on employees, customers, to its rapid response to shoppers’ new in New York, scheduled to open in 2015. L?) that removed the “L” from its signage. communities, and the planet. digital behaviors, the retailer calls itself

Kohl’s Best Buy USA USA Department Store Electronics $5,825M $4,793M +3% -41%

The good news is family-focused value such as Lauren Conrad and Jennifer Lopez While it is still the dominant player in its online presence remains a top department store Kohl’s is keeping pace remains lucrative. While Kohl’s new chief consumer electronics, Best Buy struggles priority along with mobile and creating with the competition. The not-so-good customer officer, Michelle Gass, raised to live up to its name. Its turnaround a seamless omnichannel experience. news is that fighting for share in the eyebrows when she opened stores on strategy included cost-cutting, more Ship-from-store, in-store pickup, and a deal/trend space makes brand a less Thanksgiving evening and stayed open for competitive pricing and efforts to loyalty program were more immediate distinguishing factor in maintaining 108 straight hours leading into Christmas enhance the shopping experience wins for the brand. The success of its margins and inspiring customer loyalty. Eve, she continues the work of evolving in 2013, while a new store prototype in-store Samsung boutique will serve as a However, the retailer’s practice of the Kohl’s brand in its e-commerce was scrapped in favor of boosting its model, overtaking floor space devoted to exclusive collaborations with famous channel, recommitting the retailer to e-commerce capability. Although online low-margin physical media, as the brand fashion designers like Catherine the creation of a “total omnichannel sales increased this past holiday season attempts to continue to turn around Malandrino and Vera Wang and celebrities experience” for its shoppers. by 23.5 percent year-over-year, expanding its fortunes.

68 Best Retail Brands 2014 AutoZone Gap USA USA Auto Parts Apparel $4,669M $3,920M +7% +5%

In 2013, AutoZone’s net income and than competitors’ stores, and in some Gap saw financial growth for its fiscal on a reserve-in-store feature. Soon, earnings per share grew significantly, locations stay open until midnight, year 2013, but must work to keep pace shoppers will be able to scan items with making it the leader in its category. seven days a week. AutoZone’s strong with—or stay ahead of—nimbler rivals. a smartphone for outfit suggestions as While the DIY car repair category is customer base, including its B2B Looking to differentiate with consistently well. Parent Gap Inc. is moving to rapid- thriving, competition is stiff. It spent segment, appreciates customer-friendly great products, compelling marketing, response manufacturing to navigate this year integrating AutoAnything.com, services such as its Z-net digital inventory and a seamless customer experience, Gap fashion, color, and design trends, which an online marketplace for auto and information catalog, tool loans, is building an integrated omnichannel will improve speed to market, minimize accessories and aftermarket automotive free diagnostics and advice. With more experience and true personalization. risks with assortment, and make it easier parts it acquired in 2012—a smart fit, than 5,200 stores in North America, the Its Styld.by co-creation platform for to restock merchandise and increase as both brands put customers first. For company is venturing abroad, recently fashion, music, and lifestyle influencers orders of popular items across Gap and its example, AutoZone stores open earlier opening three stores in Brazil. is going global, while tests are underway sibling brands.

Avon Bed Bath & Beyond USA USA Specialist Specialist $4,610M $3,860M -11% +6%

Loyal customers still appreciate Avon’s customers and representatives to connect Despite Amazon’s ability to undercut Its online sales channel, representing values, philanthropic work, and through social media. The international prices, Bed Bath & Beyond continues just 3 percent of overall revenues, commitment to empowering women. beauty brand’s makeover plan includes to capitalize on consumers’ desire to needs a boost. It’s thus investing in IT But recent setbacks mean the next exiting the Vietnamese, South Korean, shop for home goods in a specialty development, analytics, and e-commerce few years will be a crucial test for the and Irish markets. It also announced environment. While its stores haven’t improvements, with plans to make point- 126-year-old brand as it dramatically cuts the steeply discounted sale of its Silpada undergone full redesigns, the focus on of-sale improvements in its stores. With costs and prioritizes what matters most. jewelry home party business. With extensive selection and merchandise a global network of 7,800 suppliers, lack That includes investing in technology, focus, discipline, and recommitment to displays that encourage impulse buys of quality control of its supply chain also providing digital tools to its six million its values and heritage, Avon could reach still serves it well, although analysts are leaves it vulnerable to recalls, such as the representatives worldwide, and creating its goal of single-digit percentage revenue skeptical about its reliance on coupons. 34,000 baby bath seats recalled in June. mobile apps and more opportunities for growth by 2016.

Whole Foods Market Old Navy USA USA Grocery Apparel $4,166M $3,214M +173% +15%

The leader in the natural foods/organic company sees enough demand Gap Inc.’s family fashion brand is performing well, and also has plans for grocery category delivered 2013 results to justify operating 1,000 stores in continues to engage shoppers with its stores in the Philippines. The company that included a continuation of increases the U.S. alone. To keep its brand value, nostalgically quirky ads, and an made a few stumbles recently, finding in comparable store sales and gains in robust, Whole Foods is betting on interactive music-and-fashion brand itself accused of patent infringement market share. While others try to nose experimentation, such as its store in experience that extends across stores, for boardshorts, selling graphic t-shirts into the space, Whole Foods continues Detroit that’s testing a new product mix online, television, and mobile. Old with typographical errors, and offering a to dominate mind share and draw and pricing structure that may help Navy’s target shoppers are mothers in coupon program that irritated customers. ever more consumers into its sphere reposition it as a provider of everyday their 30s, busy juggling children and Nevertheless, the brand achieved of healthy eating. With more than 350 staples for cost-conscious consumers. work, who like to buy for the entire respectable gains and benefits from its stores in North America and the U.K., the family in one trip. As promised, the parent’s e-commerce and cross-branded brand has opened stores in Japan where it digital sales sophistication.

70 Best Retail Brands 2014 Sherwin-Williams Ross Dress for Less USA USA Home Improvement Apparel $3,118M $2,444M +15% +16%

Sherwin-Williams boasts remarkably interaction with customers. Consumer- In strictly operational terms, America’s strategic focus includes maintaining the high brand recognition and loyalty directed ad campaigns declare its love second largest off-price department store right mix of name brands and fashions, from both paint professionals and home for color, as does its HGTV® HOME by chain is a clear success. Comparable localizing store assortments, managing improvement consumers. The global Sherwin-Williams line, partnerships stores sales are solid and the outlook for real estate growth effectively, and paint and coatings specialist added 20 with Williams-Sonoma and Pottery Barn, the category remains strong. Though delivering an experience that is in line new stores to its U.S. fleet this past year, and the introduction of clever website mostly present in Western and Southern with shopper expectations. Its challenge: staffing them with paint-knowledgeable and mobile capabilities, like its app for states, Ross Dress for Less is expanding retain its core base of treasure hunters, associates who can help contractors Google Glass, called ColorSnap Glass. in Chicago and the Midwest. It’s not who love bargains enough to tolerate improve margins and give DIYers valuable The company continues on the path apparent that the company operates endless racks, understaffed checkout advice. The company’s controlled to growth, reaching over USD $9 billion from a strong set of brand values, yet counters, and general untidiness. distribution platform gives it a distinct in sales in 2013. its shoppers are clear on its offering. Its competitive advantage and allows direct

Shoppers Drug Mart Gamestop Canada USA Drugstore Specialist $3,111M $2,336M -5% -8%

Despite ongoing prescription drug reform sell Loblaws’ market-leading private The retailer engages gamers through its in point: its business got a boost in 2013 in Canada, Shoppers Drug Mart (SDM) label food brand, President's Choice, sizeable network of stores, e-commerce, from the release of next-generation game started 2013 with a rise in earnings and and SDM's market-leading health and print and online magazines, and loyalty consoles, Microsoft Xbox One and Sony higher sales driven by its non-pharmacy wellness Life brand in each other’s stores program. The brand serves as a marketing PlayStation 4. Both consoles allow gamers business. With many profitable urban could provide the synergies to justify the outpost for enthusiasts, keeping them to play used games, which are crucial to locations, the leading pharmacy and purchase price (and also shelved Loblaw’s informed about newly available and GameStop’s appeal and profitability as food retailer was an attractive acquisition planned Nutshell health store concept). highly anticipated games. Because of its customers routinely sell old games to target and in July, grocery giant Loblaw Let’s see how consumers react after the this intense customer relationship, the afford new ones. But with gaming’s shift Companies Ltd. shook up the retail world recently approved merger closes and the company is optimistic about its ability to digital downloads, GameStop will need by paying CAD $12.4 billion (USD $11.93 integration plans are set in motion. to remain relevant in the future. Case to adapt its business model to survive. billion) for SDM. The ability to cross-

Lululemon Athletica T.J.Maxx Canada USA Apparel Apparel $3,087M $2,123M -13% +22%

The yoga-inspired athletic brand known of 2013 was spent in damage control, In a testament to consistency, T.J.Maxx customer traffic for the fifth consecutive for its meteoric rise and impressive Lululemon continued to open stores in and Marshalls, the two brands that make year, with more young people shopping growth suffered a year of turmoil. A North America, a showroom in Hong up The TJX Companies’ Marmaxx Group, the brand. After an eight-year hiatus, it much publicized product recall and Kong, and diversified its product offering again occupy nearly adjacent spots on relaunched its e-commerce site, spending attempted correction caused supply through new swimming and ballet lines Best Retail Brands. The off-price apparel USD $200 million to acquire e-tailer Sierra chain delays, late inventory, and for women and cycling and running lines and home goods leaders are thriving by Trading for its technology and expertise. quality complaints. The product recall for men. It will not be easy for Lululemon updating merchandise and responding Now that the inventory challenges of also resulted in major changes in its to recover its premium brand cachet, but quickly to current trends thanks to what’s selling close-out merchandise online have leadership team—most notably with the company maintains a solid financial been described as “a brilliantly run” been addressed, T.J.Maxx expects the founder Chip Wilson and CEO Christine position and a passionate customer base. buying operation. T.J.Maxx increased channel to be a new profit center. Day stepping aside. Although much

72 Best Retail Brands 2014 Michaels PetSmart USA USA Specialist Specialist $2,035M $1,812M +4% +10%

In the third quarter of fiscal 2013, partnerships and product associations The largest player in the pet supplies new set of leaders in its C-suites—CEO, Michaels reported a 66 percent jump that connect with customers. Although industry with USD $7 billion in annual COO, and CFO—and unveiled plans for in net income. The leading specialty it has yet to offer true e-commerce, the sales, PetSmart has added 55 new stores smaller urban locations with inventories retailer of arts and crafts attributes this company’s website is rich with project and 3 pet boarding locations for a total of below the 11,000 items typically carried impressive growth to additional stores, inspiration, personalized photo-printed more than 1,314 PetSmart stores and over in its big box stores. PetSmart’s annual more business, bigger transactions, merchandise, a blog, and plenty of 196 PetsHotels in the U.S., Canada, and revenue is growing at slightly more than and higher margins. The company printable and mobile coupons. While it Puerto Rico. According to the company, 10 percent, helped by new store openings. has also benefited from its unique is a highly seasonal business, Michaels broader foreign expansion “isn’t needed Comparable store sales, meanwhile, customer engagement strategy, which continually refreshes key areas of the yet.” This year, the service-oriented increased by more than three percent. emphasizes crafting classes, products, store to stay relevant to its core audience one-stop-shop for pet parents put a and promotions. Michaels differentiates and attract infrequent shoppers. its brand through exclusive merchandise,

Marshalls Banana Republic USA USA Apparel Apparel $2,028M $1,795M +19% +2%

Marshalls is the smaller of the two tends to be capricious, but its value- Through its 700 stores in North and for Oracle Team USA, the sailboat racing Marmaxx Group brands, with slightly seeking customers expect it. The brand South America, Europe, and Asia, and syndicate defending the 34th America’s fewer stores and a different product mix. has a clean, fresh online presence at an e-commerce platform serving 80 Cup. In pursuit of a seamless brand As one reviewer put it, “it’s like T.J.Maxx the Marshalls & T.J.Maxx Newsroom, countries, Gap Inc.’s Banana Republic experience, Banana Republic consolidated is Banana Republic and Marshalls complete with Instagram and Pinterest brand offers professionals work wear all channels under a single global brand. is Gap.” Still only brick and mortar, lookbooks along with fun advice from that can be styled for any occasion, “from However, the U.S. apparel retail market Marshalls’ “no walls” store set-up gives style and trend experts. Based on growth desk to dinner.” This past year, it snagged has been particularly weak due to it flexibility to make the quick changes opportunities in the U.S. and Europe, the spotlight with designer collections cautious consumer spending, which had necessary for the daily arrival of new TJX hopes to significantly increase the in collaboration with L’Wren Scott and an offsetting impact on financials as the merchandise. The shopping experience Marshalls store count. Kate Middleton-favored Issa London, and brand registered negative growth. was also chosen as formal attire supplier

J.Crew Canadian Tire USA Canada Apparel Mass Merchant $1,868M $1,760M +3% -3%

As a purveyor of well-made classic as well as from J.Crew Factory sales. Canadian Tire held its own in a field experiences to better align with clothing cut to the latest trends, J.Crew Comparable store sales, however, crowded by new U.S. entrant Target its brand positioning and remain excels in defining and defending its increased only slightly. The brand has a and the expanding footprint of both competitive in the marketplace. spot in specialty apparel. Evidencing tongue-in-chic presence in social media Walmart and Amazon in Canada. Major initiatives include a lifestyle hub the brand’s success, sales and revenue with a cult-like following of bloggers and The iconic retailer and one-stop shop called The Canadian Way, testing a new increased this year, it opened a London fashionistas for brand president Jenna for everything from sporting goods rewards strategy, and the launch of flagship store with great fanfare—and Lyons, a fall collection that debuted and hardware to housewares and Canadian Tire Express for urban centers. made headlines as a potential acquisition on Pinterest, Instagram in-store style auto accessories has long played to These initiatives demonstrate that target for Uniqlo owner Fast Retailing. sessions, and a Fashion Week diary on its its Canadian heritage in advertising. Canadian Tire is proactively defending Most of its growth came online via the lively Tumblr blog. However, Canadian Tire has recently its market position and will not let go 100+ countries served by jcrew.com, started to reshape its in-store and online without a fight.

74 Best Retail Brands 2014 Dick’s Sporting Goods Bath & Body Works USA USA Specialist Specialist $1,528M $1,421M +7% +7%

The sporting goods leader had a busy expenditures, the retailer is confident the Bath & Body Works aims to improve abroad have led to plans to open more 2013, opening two Field & Stream stores, result will sustain long-term advantages. consumers’ emotional and physical international franchises in the near 40 Dick’s Sporting Goods stores, one Meanwhile, net sales were flat in 2013 well-being with enticing fragrances for future. Also indicative of change on Golf Galaxy store, and two True Runner compared to the 4.3 percent increase their bodies, hands, and homes. Judging the horizon, the brand’s long-running locations. In addition, 75 existing Dick’s in consolidated same-store sales a year by the loyalty of its young female fans, signature country-inspired gingham stores underwent partial remodeling. earlier. To reach its USD $10 billion sales the brand is succeeding. The company’s motif is being remade into a “modern The company poured resources into target, the retailer plans to add 300 stores frequent and innovative product day apothecary of beauty.” Judging by the its omnichannel strategy, including in the next four years to total more than launches keep the customer engaged numbers, Bath & Body Works remains improved mobile capabilities, a click- 800 Dick’s Sporting Goods and 55 Field & and lower-priced and mass competitors relevant as an affordable indulgence: in and-collect in-store pilot, and a stronger Stream stores. at bay. Successful ventures in taking 2013, sales increased by 9 percent and e-commerce team. Despite high capital the Bath & Body Works experience operating income by 19 percent.

Dollar Tree American Eagle Outfitters USA USA Dollar Store Apparel $1,496M $1,294M +14% +8%

Dollar stores have been battling both sales, drive traffic, and improve A leading retailer of casual wear for the shuttering of underperforming stores a weak economy and big box discount market share, the retailer remixed tweens through college-age shoppers, in favor of new stores in underserved chains competing for discount shoppers. assortments to include fast-turning items American Eagle Outfitters continues markets, and aggressive expansion of Against tough odds, the world's leading people need every day, in addition to to prove itself resilient in the face of its factory stores are lifting profit margins operator of $1 price-point variety stores seasonal and discretionary merchandise. fickle audience and their over-reliance and boosting earnings. A robust online continues to grow, enjoying another Dollar Tree’s positive performance may on promotions. While past efforts to store accounts for about 13 percent of healthy jump in value. The company owe less to a recent initiative to create expand into different target audiences via sales. With over 1,000 mall-based stores opened over 300 stores in the U.S. and a branded experience that’s “bright, Aerie, 77kids, and Little 77 seem to have in North America, American Eagle Canada for over 40 million square feet of fun and friendly” than reigning had little impact, more recent company Outfitters plans to raise its total store selling space total, and reported record macroeconomic conditions. initiatives led to modest growth this past count closer to 1,250. sales in the first half of 2013. To increase year. Improved inventory management,

Tractor Supply co Family Dollar USA USA Home Improvement Dollar Store $1,492M $1,183M +16% +17%

To say the rural lifestyle retailer had a have never heard of it, Tractor Supply 2013 saw a major milestone for the Family 25 percent of total sales for the extreme good year would be putting it mildly. impresses with its strong earnings, solid Dollar brand with its 8,000th store value retailer. Yet, as the brand continues Tractor Supply Co. continues to thrive by financial position and a sustained focus opening. Even so, it lags in presence to gain market share and increase serving its target market: recreational on productivity. In 2013 the company behind chief rival Dollar General, which sales, it struggles to maintain profit farmers and ranchers and those who opened more than 100 new stores, and is boasts a fleet of 11,000. Nevertheless, levels. Customers living from paycheck enjoy the “Out Here” lifestyle. Its stores, expanding into the western region of the Family Dollar has been working to to paycheck continue to be stretched, website, magazine, and advertising U.S. While its e-commerce channel is still differentiate its brand through updated sticking to basic necessities and buying clearly differentiate the brand from relatively young, it’s learning fast how store layouts, expanded consumable fewer high-margin items. In response, general merchandisers and home best to fulfill its customers’ needs when it categories, and an increased selection Family Dollar is clearing out unproductive centers. Although many consumers comes to property and animal ownership. of health and beauty. Its private labels merchandise while strengthening are popular, representing more than consumables and basic necessities.

76 Best Retail Brands 2014 Urban Outfitters Cabela’s USA USA Apparel Specialist $1,122M $1,066M -5% +27%

It was another year of healthy sales for Its tradition of riling up critics endures Famed as a tourist destination, outdoor stores (due to their size and expense) tend Anthropologie’s Urban Outfitters brand. with the bad PR-generating graphic sports retailer, and direct marketer, to slow expansion, which has led Cabela’s It announced plans for an additional T-shirts bearing outrageous slogans Cabela’s is the acknowledged leader in to explore smaller footprints of 70,000 distribution center to feed its almost 200 its rebellious customers expect. In the hunting and fishing categories. Its to 125,000 square feet with more flexible stores in North America and Europe, as October, Urban Outfitters unveiled enormous legacy stores at 180,000 to floor plans. Even though these Outpost well as web and catalog sales. The hip plans for a 6.5 acre “lifestyle experience” 250,000 square feet draw millions with stores serve smaller U.S. towns, they 18-to-30 crowd connects with the brand in Pennsylvania, (similar to the museum-quality displays of taxidermied consistently outperform the legacy stores through its eccentric but entertaining “mini-cities” developed by IKEA) that game and aquariums—often including and are expected to be an important omnichannel shopping experience and will include Urban Outfitters and a restaurant, travel service, gun library, growth driver. The company plans to merchandise that’s stylish to some, Anthropologie stores, a Terrain garden and an archery range. However, such open 14 more in the next two years. eclectic and slightly bizarre to others. center, eateries, and a boutique hotel.

Advance Auto Parts Express USA USA Auto Parts Apparel $1,109M $983M NEW +15%

This year, Advance Auto Parts pushed cars, the move aims to boost Advance Sales increased in 2013, along with the clothing. However, the brand’s greater past AutoZone to become the largest Auto’s footprint in the commercial repair number of stores that are strategically commitment to fashion and design seems retailer of automotive replacement industry, as well as extend its geographic strengthening the brand’s presence. to have sparked interest in its balanced parts and accessories in the U.S. With reach throughout North America. It It now operates over 600 stores in the assortment and quality/value sweet its USD $2 billion acquisition of the also serves to future-proof the brand, as U.S., Canada, and Puerto Rico, and spot. Fashion bloggers recommend it Carquest chain of over 1,400 outlets, the forecasts for the industry predict sales is expanding in the Middle East and for office staples. While its stores tend combined company will have annual to commercial customers will outpace Latin America. Even so, this 30-year-old to have a generic feel and do little to sales of USD $9.2 billion. With parts sales sales to do-it-yourselfers as cars get more specialty apparel retailer lacks a well- tell a compelling brand story, Express in the brand’s more than 4,000 stores complicated and younger people involve defined brand heritage. For its target remains consistent, over time and across slipping as more Americans buy new themselves less with DIY repairs. 20- to 30-year-old shopper, it’s an “also- touchpoints. shopped ” option for work and weekend

Buckle Chico’s USA USA Apparel Apparel $1,082M $932M +6% NEW

Coming off a record year in 2012, on customer service. Its associates are The specialty apparel brand popularized sold in more than 600 boutiques in small the specialty retailer known for its well-educated “personal stylists” and by Debbie Phelps, mom of Olympic markets and destination centers in the exceptional service and denim selection “denim fit specialists” dedicated to athlete Michael Phelps, has turned 30 U.S. Assortments are localized, a loyalty saw sales remain essentially flat in fulfilling the brand promise of “the most with style. Chico’s success with Baby program adds value, and associates are 2013—but not for lack of trying. It enjoyable shopping experience possible.” Boomer females comes from a flattering highly attentive to shoppers in-store, opened a dozen new stores, added youth Positioning, however, remains muddled, but ingenious sizing formula that begins online, and on social media. Although apparel, and extended its interactive since it describes its offering as casual at 000 and ends at 4.5. It translates to sales were modest in 2013, a share brand-building online. It now operates apparel and delivers on branded and conventional sizes 0-22 but the size- repurchase program indicates a healthy over 450 locations in 43 states, where private label denim, the latter accounting shrinking illusion works, as does its cash flow and favorable prospects, it’s one of the rare brands that invests for more than 40 percent of net sales. trademark “Most Amazing Personal including plans to expand into Canada. in employee training and differentiates Service.” Its private label fashions are

78 Best Retail Brands 2014 NEW NEW NEW 0% -16% Europe $18,168M $13,818M $10,821M $10,299M $9,042M

-14% +7% +2% +1% +20% $5,633M $3,697M $3,376M $2,940M $2,143M European retail brands now have the power to be both in the pocket of customers (via mobile devices) and create sensory engagements (via +2% +7% +15% +5% +2% $2,039M $1,791M $1,750M $1,668M $1,543M the physical store experience). It is by leveraging innovation, co-creation, and conversations that leading retail brands in Europe will build and +4% NEW NEW NEW +12% defend their value in consumers’ minds and hearts $1,424M $1,277M $1,268M $1,221M $1,192M as they embark on, and enable, the digital retail transition together. NEW -14% +1% +4% NEW $1,115M $1,110M $1,083M $1,027M $907M

NEW +1% NEW +59% -8% $866M $813M $778M $661M $622M

+11% +32% +13% +13% +1% $610M $566M $548M $518M $508M

+9% -2% -5% +36% +3% $492M $475M $437M $427M $417M

NEW NEW +3% NEW -12% $368M $308M $308M $272M $267M

NEW +24% NEW NEW NEW $231M $212M $209M $204M $202M As a proof of success, Walmart is starting Tows ard a frictionless shopper Boey nd commerce, to replicate this format in the U.S. with journey Walmart To Go. A same-day online make the experience delivery service, Walmart To Go may Whatever the platform, European counteract Amazon Fresh, which will retailers are learning that the key is to frictionless make its non-U.S. debut and European maintain brand consistency and pay launch in Germany this year. attention to details. If format convergence and consolidation are moving forward By Bertrand Chovet, Managing Director, Interbrand Paris Grocery e-commerce sites that include upstream, omnichannel is elevating home delivery have not taken off change downstream. While 20 percent everywhere, however. In some regions, of shoppers already use a mobile device In today’s exciting new world of customers are often unwilling to pay during the purchase funnel, 4 out of delivery costs (or higher prices) and 5 European consumers are using their commerce, we see more opportunities many do not want to block out time to smartphones in-store. wait for their goods. In such areas, the than risks for strong leading brands. Drive (or drive-through) concept offers a When it comes to mobile, shoppers are convenient alternative. Though the Drive seeking a customized approach, and Leading retail brands have limitless format has to consolidate its profitability, the future will be paved with mobile/ possibilities to take advantage of it is giving leading brands a competitive point of sale interactions. Mobile advantage and securing customer loyalty. commerce, whether RFID, NFC, or

this new landscape. MEMS, will accelerate adoption and Europ Lastly, by developing hybrid models strengthen shoppers’ preference for such such as Zara/Zara.com, John Lewis/ transactions. Success will belong to those Digital must be used strategically to Closing the gap on omnichannel johnlewis.com or Fnac/Fnac.com, retailers who embrace simplicity and e bridge a compelling in-store experience European brands are not only proving immediacy in their mobile channels. with the devices that now run our While e-commerce accounts for an their inventiveness, but also their ability lives, creating a digital strategy that estimated share of 5 percent in total to meet shoppers’ expectations: being For retailers, the omnichannel incorporates omnichannel selling, mobile European retail, the traditional retailers on the purchase funnel before, during revolution involves investments and #BESTRETAILBRANDS shopper digitalization, conversations are back in the game and catching up and after, with better service leading to necessitates questioning regarding between brands and consumers, with digital pure players. Zara, John improved customer satisfaction. It is now the ROI of those investments and their augmented experiences through digital Lewis, Fnac, Leroy Merlin, Carrefour, or clear that the digital gap will narrow, if scalability. But all are gamely embarking interfaces, and a brand architecture built Tesco (to name a few) are now part of the not disappear, if leading retail brands on this journey, and it is time to connect on seamless access and transactions. most visited e-commerce websites. use their brand assets to impose a strong the dots more deeply. landmark, defend their premium, and This environment necessitates a true The battle also takes place in the physical engender loyalty. understanding of shopper insights by space. A representative example is the making sense of data and behavior. This success of the drive-through hypermarket approach also requires pragmatism, format in France (representing 2,500 efficiency, and a dose of enchantment to units on top of the 6,650 hyper/ deliver an engaging shopper journey and supermarkets in 2013), which Auchan a strong business performance. It is both pioneered in 2000. It has become one of a structural revolution and a business the secret weapons for food retailers to challenge, and today most European protect their business and build on the retailers are working hard to make the strength of their brand. transition with style and intelligence.

82 Best Retail Brands 2014 Beauty retailers such as Sephora, with the brand is a critical factor in the L’Occitane, and The Body Shop are well purchase decision. In the near future, on their way, while other categories need the substance of retail brands will grow to approach it in a more comprehensive through the ability to deliver functional way to deliver a fully “on-brand” shopper expectations seamlessly and engage journey. Europe’s leading retailers must shoppers in an emotional experience. make their brands the cornerstone of this strategy, and articulate their The most successful retailers are already, goals in order to address the challenges and will indeed continue, deploying an of engagement, responsiveness, omnichannel strategy. Availability of authenticity, and relevance. inventory will be paramount and allow retailers to develop online distribution, while physical retail combined with A more holistic brand experience experiential touchpoints will enable them to serve eager consumers. Despite the e-commerce boom, the majority of commerce for the next Both online and offline, European H&M decade will still occur in the traditional retailers will have to work harder Sweden manner: through the physical, in-store to ensure that convergence benefits Apparel retail experience. Omnichannel is customers and increases satisfaction. $18,168M NEW really about making relevant emotional connections—and a strong brand is the Retail brands now have the power to key lever to drive the success of in-store/ be both in the pocket of customers The fast fashion giant keeps exciting the WWF aims to improve stewardship online retail integration. (via mobile devices) and create sensory consumers worldwide with its brand of its water supply. The world’s second- engagements (via the physical store promise of stylish apparel at affordable biggest clothing retailer behind Zara Today, European retail brands must be experience). It is by leveraging prices, such as a USD $99 wedding dress owner Inditex, H&M opened a new store more responsive than ever before. They innovation, co-creation, and and collaborations with designers such nearly every day in 2013, with the U.S. and must listen to shoppers and be incredibly conversations that leading retail brands as Isabel Marant. Its “Conscious” eco- China its biggest focus for expansion. As consistent at every level of the purchase will build and defend their value in clothing line also drove buzz and sales. it expands into India, Australia and the funnel if they want to bridge their brand consumers’ minds and hearts as they The world’s biggest buyer of organic Philippines this year, H&M will extend proposition with customers’ needs and embark on, and enable, the digital cotton plans to use 100 percent sustainable e-commerce beyond select European desires and achieve sustainable growth. retail transition together. cotton by 2020, while a partnership with markets and the U.S. After all, the customer’s experience IKEA Sweden home furnishings S UmmARY $13,818M NEW

• E-commerce accounts for an • Brands must invest in omnichannel estimated 5 percent total of solutions and ensure that The world’s largest furniture retailer received 9.7 million downloads in 2013). European retail; traditional convergence benefits consumers operates 349 (and counting) stores in Although forced to pull food items in the retailers such as Zara, Carrefour, and increases satisfaction both 42 countries, and is holding true to wake of the horsemeat scandal and an elk and Fnac are catching up with online and off its brand promise of offering stylish meat mix-up, its Corporate Citizenship digital pure players products at affordable prices. Focused commitment efforts are commendable, • Retailers must bridge their on customer experience and value, IKEA including electric vehicle charging, • The drive-through hypermarket brand proposition with customers’ is trying to keep up with its on-the-go, geothermal energy tests, donating format has become one of the secret needs and desires and pursue design-conscious brand loyalists. It’s flatpack shelters to UNHCR for refugees, weapons for food retailers growth sustainably busy expanding e-commerce, now in and giving the proceeds of soft toy sales half of its global markets, and investing to UNICEF and Save the Children. in digital (its innovative catalog app

84 Best Retail Brands 2014 ZARA M&S Spain U.K. Apparel Apparel $10,821M $5,633M NEW -14%

Inditex, the world’s largest clothing hubs and e-commerce to 21 countries The traditional British high street services. Its revamped website, which retailer with revenue of USD $21.7 billion including China, Russia, and Canada retailer aims to transform into a global offers free delivery to the U.S., Canada its last fiscal ear,y continues to expand (and soon, Mexico and South Korea). Its multichannel brand, with 766 stores and Australia without having stores the Zara global empire—opening 110 new debut on Interbrand’s 2013 Best Global U.K. stores and 400 locations in Europe in those markets, aims to replicate its stores in 2013 and at least that many this Green Brands report indicates that Inditex and Asia—including small-format stores reputation for superior customer service year—and increase its brand value. While realizes the importance of sustainability in Hong Kong and Singapore—and and product knowledge. The eight-year- Spain is still its biggest market, China last to a brand’s credibility. Inditex also signed Australia in its sights. Yet Marks & old Plan A sustainability platform, year passed France to become its second- the Bangladesh Fire and Building Safety Spencer’s performance still primarily which helped it escape the horsemeat biggest market by store count. It’s driving pact, and promised Greenpeace it would hinges on its private-label apparel for and Bangladesh factory fire scandals online sales by expanding distribution “detox” its garment production. the family as a gateway to its line of that plagued competitors, is also home goods, food, flowers, and banking integral to the brand’s turnaround plan.

Carrefour Auchan France France Grocery Grocery $10,299M $3,697M 0% +7%

The world’s second-largest retailer by 2013 saw better than expected operating The world’s 11th largest food retailer (and partnership with Quirky invited the sales is in the midst of a turnaround growth of 5.3 percent and organic growth France’s second-largest after Carrefour), public to propose products, with the plan. Internally, the global hypermarket of 2.5 percent overall and 3.5 percent Auchan saw 2013 sales increase by 5.8 best ideas to be produced and sold in operator is refining its vision, internationally (including a robust 12.6 percent. Expanding globally, with China Auchan stores. The hypermarket operator reorganizing to respond to local markets, percent in Latin America). While sales and Russia as key markets, it’s putting is further adapting to customer needs and developing a more relevant product slowed in China and Brazil, its largest innovation at the center of its business with, for example, fresh products priced offering. Externally, the priorities are market after France, domestic sales rose strategy with an employee engagement at less than 1 € (USD $1.37). Corporate a multi-format, multi-local model; for the first time in two years. Now it program called “Creative Attitude” that Citizenship is another focus, with an strict financial discipline; managing must stick to its action plan in order to selects 26 projects out of 1,000+ ideas ethics and sustainability charter for DOWNLOAD decentralization; and upgrading stores. increase its flat brand value this year. submitted for implementation. It’s also suppliers adopted on January 1. tapping into customers’ creativity—a

LOOK FOR THE Tesco Boots BLIPPAR LOGO ON EACH PAGE U.K. U.K. Grocery Drugstore $9,042M $3,376M

FILL SCREEN -16% +2% WITH THE DOUBLE PAGE 2013 was a turbulent year for Tesco, as and trust in the brand eroded. It was Boots is in the midst of finalizing a full biggest market in Asia, its 2,500 U.K. the biggest U.K. grocer lost ground to voted worst UK supermarket in a key sale to U.S. pharmacy giant Walgreens, shops continue to focus on core brand BLIPP... THE IMAGES competitors. It pulled out of the U.S., poll and apologized for using horsemeat. which paid USD $6.7 billion in 2012 for values: superlative customer service, WILL JUMP TO LIFE created five U.K. hubs to support online Even its stake in the “indie” Harris & a 45 percent stake in the iconic British unique product and service offerings sales, and opened 150 convenience Hoole café chain was criticized, while high street drugstore chain with the goal (such as partnering with Diabetes stores, but struggled to differentiate Tesco.com was hacked in early 2014. But of creating “the first global pharmacy- UK to offer in-store assessments) and beyond price. Its revamped brand don’t discount Tesco—it still claims more led health and wellbeing enterprise.” As enhancing its flagship product brands proposition—from “every little helps” than £1 in every £8 spent in UK shops, parent Alliance Boots looks to expand in through innovations such as the digital to “we make what matters better, and 2014 could be a defining year. China (where it’s eyeing a joint venture No7 Foundation Match Made Service. together”—failed to win consumers, with a domestic retailer) and India, its

86 Best Retail Brands 2014 Aldi Asda Germany U.K. Grocery Grocery $2,940M $1,791M +1% +7%

Increasing competition is forcing the brand at home, with Aldi Nord and Value-oriented Asda is fighting to keep low on food and non-food items such as global discount supermarket chain to Aldi Süd dividing the German market, money-conscious consumers from fleeing clothing, lingerie, and flowers, part of rethink its model of selling primarily remains an issue. Nevertheless, Aldi to rivals after a tough 2013 holiday season. the “everyday low prices” positioning private label products, which accounts continues to be a strong performer and The 2nd biggest supermarket in the inherited from its parent. Partnering for about 95 percent of inventory (with expanded its new businesses in 2013, U.K. behind Tesco is seeing Sainsbury’s with Barclays and Subways outlets at a smidgen of space to the likes of Coca- including launching a budget intercity nipping at its heels and other competitors key superstores has helped, as has the Cola). Winning accolades such as Grocer bus service in Germany and putting moving into its low-price territory. The introduction of online click-and-collect of the Year in the U.K. and with a global Nestlé’s Nespresso brand on notice by Walmart-owned brand is fighting rivals’ functionality, with e-commerce revenue footprint that includes more than 1,200 promoting Expressi, its rival capsule sales gimmicks with its “Price Lock” projected to reach USD $4.9 billion stores in the U.S., the split of the Aldi coffee system. commitment. A USD $164.5 million (£100 (£3 billion) by 2018. million) investment is helping keep prices

Sephora Lidl France Germany Specialist Grocery $2,143M $1,750M +20% +15%

LVMH reported “exceptional” the brand launched the Sephora to Go app In 2013, Lidl managed to further close the range of products other discounters are performance for its global beauty retailer and m-commerce payment system in the gap with Aldi, its main grocery rival. If it offering. Lidl aims to achieve this goal in 2013, which gained market share, U.S., and has been equipping its sales continues on this track, it’s projected to by not only introducing more branded posted a 14 percent sales increase, and associates with smartphones in France. replace Aldi as the biggest global discount and higher quality products, but also by extended its lead as a digital innovator. In tandem with upgrading its global retailer by 2016. As customers not only successfully promoting its private label Innovation, increased personalization of distribution network, Sephora opened demand extremely low prices but also items. Boosting employee salaries in 2013 customer relations, and strengthening its first store in Thailand, expanded in high quality, Lidl is pursuing its growth is also helping shore up internal brand of service offerings, both in store and India and Brazil, and launched its biggest strategy by raising the quality of goods engagement. online (with Sephora.com the world’s top flagship store in China, where it now on offer, moving away from the typical beauty site), are at the core of Sephora’s operates 133 stores. strategy. A pioneer in mobile shopping,

Leroy Merlin L’Occitane France France Home Improvement Specialist $2,039M $1,668M +2% +5%

A major player in the global DIY market to stay relevant and offer a consistent The French cosmetics retailer reported L’Occitane is adapting its offer in with more than 300 locations in 13 offering, even as it’s adapting to local a modest increase of 9.3 percent in net Brazil with L’Occitane au Brésil, a new countries, France’s Leroy Merlin has a markets and working with partners. sales from April through December sub-brand at a lower price point. It’s clear positioning externally that is shared It’s committed to Corporate Citizenship, 2013, and is in the midst of a strategic also investing in online and digital internally: to “help each homeowner with 68 active projects and more than 100 global expansion plan, opening stores marketing, and extending its Corporate dream up a house and realize it.” To sustainable products. Growing its global in the Asia-Pacific region and beyond. Citizenship commitment to Fair Trade fulfill its mission, the brand’s Housing revenue by 5.9 percent last year, Leroy In addition to bringing its natural sourcing for its iconic shea butter Observatory helps gain insights into its Merlin is still a market leader in France, ingredients luxury products to the products. To that end, it’s working with customers, identify new trends, and where it’s perceived as a premium brand. world, the brand opened a research and unions and cooperatives representing spur innovation. It also allows the brand development lab with 100 employees about 15,000 women in Burkina Faso. focused on fostering innovation.

88 Best Retail Brands 2014 Edeka Bershka Germany Spain Grocery Apparel $1,543M $1,268M +2% NEW

Offering three different price tiers, consistent and authentic way. Beyond Zara’s cooler, more tech-savvy kid sister fast-fashion with street cred. The Edeka is Germany’s top supermarket tongue-in-cheek advertising, it’s looking has increased in brand value, reflecting garments stand out in a user-friendly brand for customer satisfaction and best to private-label products such as its SoYes the evolution of the teen-oriented label as shopping experience that invites visitors shopping experience. But the mid-market soy-based organic pasta line and artisanal it grows up. With nearly 1,000 stores in 66 to watch videos on LCD screens and plug supermarket brand isn’t resting on its in-store bakeries to reach more upmarket countries, Bershka is at its most creative in digitally. This emotional connection laurels. It’s investing 1.6 billion euros consumers. Scoring high points for in Asia, where its hip store in Tokyo to teens’ sweet spots can now be found (USD $2.1 billion) in a modernization Corporate Citizenship, with sustainable shows the shape of things to come. The in all its touchpoints, from lookbooks on plan in the hope that Germans will pay fish and fair trade products now a staple modern Bershka, as seen in the trendy bershka.com to its Instagram feed, with more for higher quality products and in its stores, it’s still playing catch-up in Shibuya district features open spaces e-commerce rapidly expanding to new an improved in-store experience that one key area: e-commerce. with illuminated signage highlighting markets including Russia. will transmit the brand’s values in a

Next El Corte Inglés U.K. Spain Apparel Department Store $1,424M $1,221M +4% NEW

Pioneering home delivery in 1988, Next while a brisk year-end holiday period saw El Corte Inglés, Spain’s largest backed by the debts of more than 14 enjoys a loyal base of cost-conscious an 11.9 percent in sales increase despite department store chain, is struggling to percent of the Spanish population. New customers who value quality, reliability tough conditions. Largely regarded as remain competitive. Experiencing one CEO Dimas Gimeno clearly values the and convenience. With more than 500 safe and reliable (instead of fashion- of the biggest brand value declines in longstanding merits of the store: its wide U.K. retail stores, a solid online channel, forward) with mass market appeal, its its history, in 2013 it sold the majority variety of brands, localization, added and a well-established phone and mail shoppers are increasingly demanding and of its most lucrative asset, its consumer value services, and return policy. He’s order business, its blend of fashion for wooed by competitors that excel in speed finance arm, to Spanish bank Santander. also focusing on e-commerce, turning to the entire family and homewares keeps to market and fast fashion. Next needs to Pressured by creditors to take steps to domestic suppliers, and repositioning its ringing up business. The brand saw innovate more to future-proof its brand restructure 5 billion euros (USD $6.9 Opencor brand, now Supercor Express, to 2013 sales rise 9.4 percent year over year, and win new customers. billion) of debt, it issued bonds in a deal offer more products at attractive prices.

Mango Sainsbury’s Spain U.K. Apparel GrocerY $1,277M $1,192M NEW +12%

Mango’s 10-year goal is to unseat Spanish plus-size women, Rebels for teenagers, Sainsbury’s boasts 17 percent of the tool. In 2013 it took full ownership of its rival Zara as the world’s biggest fast and a Sport&Intimates lingerie line. UK’s grocery market despite intense bank, launched a mobile brand, and saw fashion retailer, and within a decade These lines will be available in new competition. CEO Justin King, who is its Sainsbury’s Local convenience stores it hopes to quintuple sales (to 10 billion megastores now in development. Its stepping down in July, just saw the brand surpass its supermarkets. The RSPCA’s euros or USD $14 billion) and produce 300 online and digital experience is helping through its busiest ever holiday season retailer of the year escaped the 2013 million garments annually. With more boost sales and loyalty. The fast fashion and its 36th consecutive quarter of year- horsemeat scandal, while its “Live Well than 2,600 stores in 107 countries, it’s retailer was slow to respond on the over-year growth. Its beefed up online For Less” tagline is evident in campaigns on its way, particularly in markets like Bangladesh factory fire crisis last year, entertainment hub will make it the that feature real people instead of China, where it’s opening 800 stores. It’s making Corporate Citizenship an area first retailer to bundle books with movie celebrities, such as long-time spokesman also diversifying, launching Violeta for that still needs some work. downloads this year, while it’s seeking Jamie Oliver, who parted ways with the to patent its Brand Match comparison brand in 2011.

90 Best Retail Brands 2014 Mercadona Decathlon Spain France Grocery Specialist $1,115M $1,027M NEW +4%

Mercadona’s strong business model and new sections (i.e. fresh products), which Decathlon sticks to its brand positioning international revenue represents 56.5 ability to keep prices low in order to adapt shows the store’s intention to return to and heritage by making the pleasure percent of revenue, while e-commerce to clients’ financial needs in times of quality products and supporting local and benefits of sports accessible to sales increased 43 percent. It continues to crisis, has made the supermarket one of producers and creating new jobs. To keep all by offering innovative products at impress its core customers with products Spain’s most profitable stores and one succeeding and growing as a business unbeatable value. The leading European such as Tilt, a foldable bike. It was of the retail brands with biggest growth and remaining relevant to consumers sporting goods retailer had a solid 2013. recognized for customer service, taking in terms of brand value in the market. amongst increasing competition, Revenue increased 7.2 percent in a year 2nd place in a Qualiweb trophy, and Mercadona continues to grow in terms however, Mercadona’s future that saw it add 58 locations, including scoring high for loyalty in its homeland of scale and offer, opening new stores challenges include internationalization, 15 in China, 8 in Italy, and 6 in France, of France in an OC&C survey. in Spanish regions such as el País Vasco omnichannel selling and sustainability. to reach 653 stores. Now in 20 countries, and increasing its product offer through

Media Markt Massimo Dutti Germany Spain Electronics Apparel $1,110M $907M -14% NEW

Europe’s number one consumer to match online and in-store sales in the Yet another Zara sibling and member the lifestyle it inspires, but also in the electronics retailer is highly focused Netherlands. Parent Media-Saturn Group of the Inditex group, Massimo Dutti look and feel in its stores, as well as on proximity to its customers. As the has also acquired online retailer redcoon has grown in brand value thanks to the personalized tailoring service and German-based brand is geographically to create synergies and potentially its increase in 2013 sales, its constant made-to-measure shoes—closer to that spread across 14 countries with 750 improve the performance of Media Markt. contribution to the group (around 7 of a boutique than a fast–fashion chain. physical stores, it intensively invests in The lack of online presence and the percent), and its reinforcement as a Its international growth, especially advertising campaigns that continuously decision to pull out of China both led to premium brand which fits in with the in the U.S., Canada, and Taiwan, and underline its low pricing and positioning. financial losses that were reflected in the global group strategy of offering quality its increasing presence online in new Relatively late to omnichannel selling overall decrease of Media Markt’s profit products. This repositioning is not only markets are other signs the brand by launching an online store in 2012, it in the past year. reflected in a more refined concept and is on track. has introduced electronic shelf pricing

Conforama Albert Heijn France Netherlands Home Improvement Grocery $1,083M $866M +1% NEW

Owned by South African furniture gain market share in the furniture and The largest grocery retailer in the and collect-and-click technology, retailer Steinhoff, Conforama’s 266 home decoration discount segment and Netherlands, at more than 850 stores, caters to time-pressed shoppers with stores in eight countries posted more in European countries where competition Albert Heijn is making significant collection points inside and outside than USD $2.1 billion (3 billion euros) is fragmented; optimize the supply inroads into Germany and Belgium. stores—including at Amsterdam’s in revenue last year. Its three store chain and distribution costs to improve Founded in 1887, the namesake founder’s Schiphol airport. In an increasingly formats—Conforama, Confo Déco and gross margin and benefit from group motto, “to make the ordinary affordable competitive space, where competitors Confo Dépôt—are expanding in Turkey, scale consolidation, global sourcing, and the extraordinary attainable,” is are sharpening the nature of their Switzerland, Spain, and France. Despite and supplier management; and extend still highly relevant today. The brand’s proposition, the leading Dutch economic challenges, Conforama gained multichannel strategies such as click- loyalty program added personalized supermarket will need to continue to market share in Europe, even with a sales and-collect service to expand e-commerce offers to its Bonus Card program, while innovate and ensure customers clearly dip of 3 percent. Its strategy is threefold: sales beyond 5 percent of total sales. a variety of store formats and digital understand why the brand is in touch services, including in-store connectivity with their specific needs.

92 Best Retail Brands 2014 DOWNLOAD

LOOK FOR THE Argos Darty BLIPPAR LOGO ON EACH PAGE U.K. France Mass Merchant Electronics $813M $622M

FILL SCREEN +1% -8% WITH THE DOUBLE PAGE In 2013, British value merchant Argos and next-day pick-up, and expanding The French retail brand formerly known digitalize Darty, develop our brand launched a five-year plan to become a its tablet range (its private-label £99 as Kesa is in the midst of a turnaround and deflate our cost base.” Nevertheless, BLIPP... THE IMAGES digital retail leader. After refreshing (USD $163) Mytablet proved a year-end plan under new CEO Régis Schultz. Darty has a strong reputation with WILL JUMP TO LIFE its website with click-and-collect bestseller). Six Wi-Fi enhanced digital While Darty claims 40 percent market its “Contrat de Confiance” (contract functionality, 2013 e-commerce sales concept stores wooed holiday shoppers share among French home appliance and of confidence) and a solid reputation grew to 42 percent while online and by replacing traditional laminated electronics retailers, it is refocusing its for customer service. With its stores mobile visits rose 24 percent year- catalogues with iPads, digital screens, business to address challenges ranging mainly in urban areas, Schultz is over-year. In addition to testing a new and voice-activated computer systems for from undercutting by online retailers to also exploring a franchising model to hub-and-spoke distribution system and warehouse personnel, enabling quicker a tough economic climate. In response, extend its multichannel capabilities catalog format, the brand refreshed product retrieval in a bid to reposition the Schultz is implementing what he calls to France’s 2,000+ small independent its product lines, making more online brand in shoppers’ minds. Expect more a four D’s strategy: “drive trading, electronics retailers. inventory available for immediate digital innovations in 2014.

Dia Kaufland Spain Germany Grocery Grocery $778M $610M NEW +11%

The world’s third-largest discount grocer holistically. It has not only invested in Kaufland, a German hypermarket brand, markets and regions across Germany, survived the economic crisis in markets upgrading its stores, packaging and its remains customer-focused and service- it’s also engaging customers on a such as Spain, Portugal, and Argentina private-label products, but also expanded oriented, offering a full range of products variety of social media channels. by separating from the French group the brand through the Dia Maxi, Dia that runs the gamut from discount to The management team has also Carrefour and going public in 2011. Market, and Dia Fresh store formats. Its premium items. The brand launched its assembled a taskforce to launch what Strategic management and diversification diversification plan includes increasing first TV advertising campaign in 2013, they hope will be a best-in-class of products are steadily increasing the its presence internationally and smart aiming to strengthen its positioning as e-commerce experience in 2015—a top supermarket’s sales, with net profit acquisitions, including its 2013 purchase a “discounter for everyone” externally. priority, with Amazon looking to sell increasing 32.6 percent in 2013 over a year of Spain’s Schlecker chain, since Responsive to customer needs, its stores fresh produce in Germany, its second earlier. Madrid-based Dia understands rebranded as Clarel, which specializes are stocking more vegan items, for biggest market outside the U.S.,DOWNLOAD this the importance of managing its brand in household and beauty products. example. As the brand scales to new year with the launch of Amazon Fresh.

ASOS Waitrose LOOK FOR THE U.K. U.K. BLIPPAR LOGO Apparel Grocery ON EACH PAGE $661M $566M +59% +32% FILL SCREEN WITH THE DOUBLE PAGE Online retailer ASOS aims to surprise percent of transactions; continuous The food division of Britain’s largest last year. The premium retailer is catering and delight teens and twentysomethings innovation; constantly refreshed employee-owned retailer, the John Lewis to busy consumers with the expansion with a fashion-forward trove of more designer collaborations; and engaging Partnership, is expanding (creating 2,000 of Little Waitrose convenience storesBLIPP... and THE IMAGES than 40,000 items. Now available from content. Lookbooks and witty feeds new jobs this year) while upholding its in-store self-checkout, leading toWILL high JUMP China to the US, sales in the U.K., its inspire its audience to collect, curate, promise of quality and excellent service. customer satisfaction scores. ItsTO Corporate LIFE biggest market, jumped 37 percent in and share, as does the brand’s focus on The sixth largest grocery retailer in the Citizenship platform, The Waitrose Way, the last quarter of 2013. The brand is sustainability (it was the first fashion U.K., its market share rose to 4.9 percent also earned the upmarket retailer a Big characterized by a series of strategic e-tailer to achieve Carbon Neutral status) in 2013, helped by a record-breaking Tick Award in the Sustainable Supply pushes including savvy social marketing and Corporate Citizenship, including holiday period, while free online delivery Chain category at the 2013 Responsible (it was the top retailer on Pinterest last a project in rural Kenya. and click-and-collect technology made it Business Awards. year); mobile, which accounts for 30 the fastest-growing e-grocer in the U.K.

94 Best Retail Brands 2014 dm Morrisons Germany U.K. drugstore Grocery $548M $492M +13% +9%

The dm (Drogerie Markt) drugstore brand labels. It’s also active across social media The U.K.’s fourth-largest food retailer, which slumped 5.6 percent over a year strengthened its market leader position and engaged in Corporate Citizenship struggling Morrisons continued its earlier. Investing £1bn (USD $1.65bn) in its segment in 2013. The German activities such as protecting children “Fit for the Future” strategy in 2013 over the next three years, the brand brand managed to increase its revenue from melanoma. Its various accolades by expanding stores, addressing has high hopes for online deliveries, and opened 135 new stores in Europe. include its private brands, Alverde infrastructure, and finally catching up which started in January 2014 and will According to Kundenmonitor, dm was and Alana, winning GREEN BRAND with rivals by opening an online store. reach half the UK by 2015. Still, investor the most popular drugstore chain last Germany 2013/14 awards. In perhaps its Launched in partnership with Ocado, concerns persist following a run of year in Germany. Management’s biggest biggest missed opportunity, however Morrisons.com aims to be “the closest quarterly declines, while its late entry priority is to not only anticipate but also dm lacks an online store, having ended thing on the Internet to being in store” into smaller convenience stores puts it fulfill customers’ needs by offering a a two-year deal with Amazon due to including a virtual butcher—but it was at a disadvantage with higher-end peers wide range of high quality private disappointing sales. introduced too late to boost holiday sales, Waitrose and Sainsbury’s.

Rewe Casino Germany France Grocery Grocery $518M $475M +13% -2%

German mid-market supermarket $2.2 billion) in 2014 to expand stores, Groupe Casino’s branded revenue percent last year, of which 3.6 percent Rewe is investing in order to live up to upgrade product, and improve the retail accounted for less than one-third of represented food sales. Its latest sales it brand value proposition of “Besser experience to keep up with rivals, it’s global revenue in 2013. It operates 10,000 figures show it’s increasingly competitive leben” (“Better Living”). While its also launching concept stores in upper stores worldwide but is primarily located with Carrefour and Auchan. Casino is private-label brands target low budget middle-class communities. The social in France, where it’s reducing non- continuing its strategy of “Back to Basics” to gourmet tastes and offer a wide range media savvy brand also maintains a large food surfaces in stores and working to in France with competitive pricing, of organic products, it’s at the upper commitment to Corporate Citizenship, keep prices low on 3,000 products. Its more efficiencies through operational end that the brand is focused. Plans including CSR activities such as Fair Trade formats run from Superettes to Franprix excellence and structure optimization, include creating in-store bistros and sushi Products, sustainable fish products, and convenience stores to the Monoprix urban store renovations, and other evolutions of bars, with events like caviar and oyster rainforest projects. variety chain and Géant hypermarket the brand, including a focus on locally- tastings. Investing 1.6 billion euros (USD format—which saw sales decline 7.7 sourced fresh product.

Fnac Migros France Switzerland Specialist Grocery $508M $437M +1% -5%

In the wake of closing underperforming unit and is now launching a streaming More than 2 million Swiss residents are of its comprehensive Generation M stores, Fnac’s brand is moving ahead, service, Fnac Jukebox, starting at 2 euros members of the Migros cooperative, the sustainability program, which offers reporting rapid growth in 2013 of (less than USD $3) per month to compete country’s biggest retailer, supermarket a variety of commitments, including omnichannel sales (up 29 percent, with with Deezer and Spotify. Diversifying its chain, and employer. Its grocery sales adopting MSC-certified tuna in 2013 and Fnac.com now France’s #2 e-commerce inventory to include new categories such increased by 9.1 percent in 2013, including becoming “bee-friendly” in 2014. Keeping site) and the development of its online as connected devices, it’s still viewed as a record 2 billion Swiss francs (USD $2.2 prices low while increasing efficiency and marketplace sales (which increased 30 a destination brand and looking to grow billion) in sustainable product sales. profitability in 2013, the “orange giant” percent). While still fighting to increase by thinking small, including developing Switzerland’s biggest online food retailer engages customers via the Migipedia.ch relevance in the face of declining smaller stores in high-traffic areas such saw its LeShop.ch site boost sales 5.1 platform, which crowdsources ways to markets, such as books and music, the as near train stations. percent last year. It also opened its first constantly improve its offering. 60-year-old retailer downsized its music organic supermarket in Zurich as part

96 Best Retail Brands 2014 John Lewis Coop U.K. Switzerland Department Store Grocery $427M $308M +36% NEW

The veteran British retailer, which following a year-end holiday season that Switzerland's number two grocer held that rose 13.3 percent in 2013 to a record opened on London’s famed Oxford saw it test in-store check-outs using its own in a highly competitive year, 1 billion Swiss francs (USD $1 billion), Street in 1864, continues to embody its tablets and generate social media buzz with Coop Supermarket sales up 1.5 or 5.5 percent of its total sales for 2013. 89-year-old tagline, “Never Knowingly for the heartwarming “The Bear and the percent. The Coop Group of retail brands, While the backbone of the company Undersold.” Named the U.K.’s favorite Hare” holiday campaign. Owner John which includes Coop City department remains its physical stores, with six new brand in a 2013 customer experience Lewis Partnership (which also operates stores, makes sustainability a priority, supermarkets for a total of 828 locations, survey by Nunwood, its Corporate Waitrose) is eager to expand its flagship with a goal to be CO2-neutral by 2023. 2013 online sales grew 15.4 percent via Citizenship commitment includes brand across the UK and digital via The 20th anniversary of Coop’s organic the coop@home website and a mobile developing renewable energy sources. localized e-commerce in Europe and the private label Naturaplan was celebrated app connecting shoppers to 13,000 In 2013 it posted monthly sales in excess JLab tech incubator to spur innovation, with an advertising campaign and sales grocery items. of USD $164 million (£100 million) all the better to meet customers’ needs.

B&Q The Body Shop U.K. U.K. Home Improvement Specialist $417M $308M +3% +3%

As the largest home improvement and and the Queen’s Award. Its DIY.com site Part of the L'Oréal family, The Body younger in 2012 with Millennial-geared garden center retailer in the U.K., has updated product ranges, improved Shop has a clearly articulated vision and items such as colored hair chalk, its B&Q enjoys high brand awareness. home delivery, and added reserve-and- set of values that govern the business Beauty With Heart platform creates The DIY specialist, originally known as click, while the in-store experience is strategy and the consumer-facing brand a more relevant brand experience, Block & Quayle, has won recognition being enhanced through shops within proposition dating back to its days under including giving customers a choice of for partnerships such as Children in shops. Its social network, Streetclub, founder Anita Roddick. Renowned for charitable causes which their purchase Need and for sustainability initiatives. aims to build communities, virtual being cruelty-free and pro-Fair Trade, can go towards. The brand experience Delivering on its environmental and real. Further enhancements to wits global Corporate Citizenship is consistent across channels, with an commitments as part of parent company the omnichannel experience will make platform differentiates the offer, from ongoing effort to align the in-store and Kingfisher’s Net Positive platform has led the B&Q range even more shoppable, Europe to North America, from Asia to online experience and its “Pulse” concept to awards from The Guardian, Retail Week whether at DIY.com or in-person. Latin America. Repositioning to skew governing store design.

. BIM Magnit Turkey Russia Grocery Convenience Store $368M $272M NEW NEW

BİM pioneered hard-discount retailing in aggressive growth goals, it’s streamlining Russia’s biggest grocer by store count lower performance of competitors, its Turkey when it launched in 1995 with 21 its business from procurement to and sales volume, overtaking rival X5 by store traffic has increased in the past stores. Reporting year-over-year growth operations. The brand has passed revenue last year, primarily operates in year and it posted record profitability, since, it accounts for the majority (12.5 4,000 stores in Turkey, opening 345 communities of up to 500,000 citizens. sending its stock price soaring 65 percent percent) of FMCG sales in the country. new locations and four regional offices Since 1998, it has opened more than in 2013. While it may be competing Driven by efficient cost management and last year. It also expanded in Morocco, 8,000 stores operating in four main with more upmarket competitors in key a commitment to customer satisfaction, opening 54 stores for a total of 164 in formats: hypermarkets, convenience markets such as Moscow, it continues its stores sell a narrow range of products the market, and made Egypt its second stores, Magnit Family stores, and to adapt to consumer demands and (600 SKUs) in order to keeping quality international outpost, with 35 stores Magnit-branded cosmetic stores. is reportedly eyeing acquisitions as a high and prices low. In order to meet open by year-end. Its strategy is in line with the brand strategy to fuel growth. promise, “Always low prices.” Due to

98 Best Retail Brands 2014 Debenhams Desigual U.K. Spain Department Store Apparel $267M $209M -12% NEW

Debenhams is focused on omnichannel Oxford Street store in London. Its 200th Bright colors, edgy designs, and bold hotels, and other locations to double retailing and moving seamlessly into the anniversary and Life Made Fabulous marketing that gives free clothes to sales annually over the next four years. online selling space. Digital investments campaigns resonated with customers and underwear-clad shoppers are some of Under its “La vida es chula” (“life is cool”) include mobile apps for Android, Apple drove perception of the brand, supported the cheeky traits of the Barcelona-based tagline, new lines include perfume, and Windows; online box office ticket by clothing lines, some exclusive, by Desigual, which prides itself on being cosmetics, home goods, and shoes. sales; and next day delivery, resulting designers such as Julien Macdonald and “Atypical.” While Asia’s a challenge, it It’s confidently targeting sales of 1 billion in online sales leaping 46.2 percent in Matthew Williamson. Its private label has rapidly expanded to 60 new countries euros (USD $1.4 billion) in 2014, up 22% 2013. The U.K. department store brand range also accounts for more than 50 and 400 stores in the past three years, over 2013, and increasing online sales is expanding internationally (and percent of sales, helped by the brand’s and aims to open 100 stores a year and to 25 percent from 10 percent currently. delivers to 66 countries) while updating clear identification of its target audience. expand in department stores, airports, its U.K. stores, including its flagship

Carphone Warehouse SportsDirect.com U.K. U.K. Electronics Specialist $231M $204M NEW NEW

Carphone Warehouse posted six push spurred record online holiday SportsDirect.com is new to Best name that suits a website but not a store. consecutive quarters of growth, traffic, while an investment of £10 Retail Brands this year, emerging On the plus side, a sound pricing strategy increasing its U.K. market share by million (USD $16.7 million) this past year as a clear market leader following has helped differentiate the brand the end of 2013. Investors and rivals helped double its online budget, revamp the demise of main rival JJB. While on the High Street, leading to a gross are closely watching merger talks with its 785 U.K. stores and even woo model ostensibly championing consumers, profit increase of 35.1 percent in 2013. Dixons, which owns Currys and PC Kate Moss to design a first-of-its-kind it fails to articulate its values, vision, Responding to criticism of the in-store World. CEO Andrew Harrison credits “fashion tech” line. Its focus is customer- or personality. The tone of voice is experience, SportsDirect.com invested the mobile retailer’s resilience to oriented growth, including opening more purely functional and focused on low in staff training (via workshops with “strong brand awareness” and “excellent than 60 standalone Samsung stores across prices, while the visual impression is Nike) and extended London 2012 in-store retail execution,” including upselling Europe this year, where it operates more inconsistent, in keeping with a brand specialist areas to solidify its expertise. customers to 4G. A multichannel sales than 2,000 stores.

Primark Tous U.K. Spain Apparel SpecialIST $212M $202M +24% NEW

Priding itself on having the lowest prices 2014. Dipping into social marketing with Barcelona’s family-owned jeweler offers It’s also customizing jewelry and leather among high street retailers, Primark’s the launch of a Twitter feed in November, affordable luxury, selling handmade products through TOUS by YOU, which is brand awareness remains high as it’s avoiding its own e-commerce channel products designed and produced in its sold through tous.com along with other owner Associated British Foods looks due to small margins, despite a successful own workshops. Its strategy has evolved accessories, watches, and perfumes. to add a million square feet of selling online test with ASOS in 2013. ABF from reducing the presence of its iconic Corporate Citizenship is a big priority, space in Europe this year and expand its makes Corporate Citizenship a priority “teddy bear” mascot to creating more with founder Rosa Oriol active in the flagship Oxford Street store in London. for the brand, signing the Bangladesh evolved and mature jewelry. As part of fight against breast cancer and other The Dublin-based retailer reported an Safety Agreement and Greenpeace’s that maturation, it’s revitalizing the look causes. Despite the brand’s wide presence impressive 22 percent year-over-year toxic-free pact as part of its ethical and feel of its 450 stores and its website in Latin America, growing in China and increase in November thanks to 19 new business commitment. to offer a better customer experience. the U.S. is still a priority. European stores, with 20 more planned in

100 Best Retail Brands 2014 +8% +14% +11% -8% NEW AsiP a- acific $4,948M $4,160M $4,061M $1,840M $1,834M

+1% +13% +6% +11% +11% $1,519M $1,313M $1,169M $1,041M $963M In the Asia-Pacific region, online retailing is giving traditional retailers the opportunity to expand more rapidly, multichannel retailing is finally starting -32% +17% NEW +15% +28% $801M $755M $670M $653M $630M to take hold—and innovation is everywhere. Home to approximately half the world’s population, with China set to overtake the U.S. as the world's biggest -3% NEW +1% -7% +3% retail market by 2016, the potential of this region is $620M $613M $601M $584M $579M practically boundless.

+8% -7% -5% -17% +22% $555M $511M $511M $426M $403M

+17% +13% NEW NEW +10% $402M $378M $350M $348M $334M threat from more agile online retailers. for sophisticated engagement. For example, Tsreime a changing in Although there are no pure-play Asia-Pacific Bangkok saw the launch of a (literally mobile) online retailers on Best Retail Brands (yet!), it virtual store—the first in Asia—when a BTS tAiahe s -Pacific market— is striking that many of the region’s leading SkyTrain was converted into a Big C store, e-commerce players such as Japan’s Rakuten, where consumers could shop by snapping but retail basics still India’s Flipkart, and China’s Taobao, Tmall or QR codes placed inside the train. JD.com are web-only. hold true While some Asia-Pacific traditional retailers Across the region, multichannel retailing is are gamely joining this brave new world, finally starting to take hold, as traditional others appear to be trying to turn back the By Stuart Green, CEO, Interbrand Asia-Pacific players realize that their online and offline clock. 2013 saw one of Japan’s leading online offerings need to orkw in harmony. In fashion commerce sites launch WEAR, Japan, Rakuten and Amazon are forcing a “showrooming” mobile app allowing Home to approximately half the world’s population and the traditional stores to do more and in shoppers to scan barcodes in-store and witnessing rapid urbanization and income-growth, the the concentrated and relatively protected purchase online, with the offline retailer market of Australia, department stores David receiving a commission. The response Asia-Pacific region is an appetizing retail market for Jones and Myers are only now beginning to this innovative solution was mixed: some domestic and international players alike. to build-out omnichannel strategies due Japanese retailers attempted to ban in-store to competitive threats. Indeed, the major mobile use, while established department

supermarkets such as Coles and Woolworths stores such as Parco actively participated. P Asi This growing critical mass of consumers is brands are those that actively expanded may find themselves being forced to certainly enticing, with China set to overtake beyond their home base, either regionally innovate, or suffer a potential decline to their a Targeting matters -

the U.S. as the world’s biggest retail market or internationally. Leading Japanese retail dominant positions as competition broadens. a

by 2016. However, as our analysis highlights, brands such as Uniqlo and FamilyMart are c ific there are few truly regional brands to looking beyond their domestic customer China’s Suning, the nation’s largest home The real story here is not the eye-catching emerge despite the APAC region’s incredible base to younger, dynamic markets in China appliance retailer, is transforming itself into execution—rather, it is back-end data potential—not surprising, perhaps, given and Southeast Asia to fuel future growth. an e-tailer so that it doesn't suffer the same capabilities. This is where true competitive the challenges of adapting to diverse Meanwhile, brands such as Chinese jeweler decline as some of the brick-and-mortar stores advantage will accrue. The less-hyped aspect #BESTRETAILBRANDS cultural preferences and languages as well as Chow Tai Fook are finding that expansion in the U.S. and Europe. China has the world’s of the WEAR app is its potential as a massive navigating a variety of regulatory hurdles. into third- and fourth-tier domestic cities largest online population and Asia's most database of personalized clothing preferences offers new sources of revenue. SM, the vibrant e-commerce sector, where virtually and its ability to suggest coordinated apparel leading retail brand in the Philippines, also anything can be bought and sold online. With based on what the shopper likes and may A fragmented landscape sees enormous potential for expanding its 70 percent of e-tailing in China being peer own, not just to sell a single item of clothing. footprint. to peer and a consumer class with money to From Lawson’s 57 million-strong loyalty Asia’s consumer markets remain highly spend, e-tailing is leaping ahead of brick-and- card database to the local corner shop, at fragmented, both as a whole and within mortar stores in many parts of the country. least one rule of successful retailing remains individual markets. Genuine liberalization Digital driving expansion Rapid digital adoption also means that unchanged—know your customer. is patchy at best, with traditional and local market maturity is no longer a prerequisite retailing dominating in many markets. At The rise of smartphone penetration continues one extreme, there are highly concentrated to revolutionize the retail sector. Already markets such as Singapore, where FairPrice a region of early social media adopters, S UmmARY commands over 50 percent market share in the availability of faster mobile broadband the grocery category; at the other, markets in Asia has facilitated a rapid spread of • The Asia-Pacific region is home • Adapting to diverse cultural such as India, where modern retail brands information, influencing preference, and in to approximately half the world’s preferences and languages as well remain dwarfed by traditional local retailers. many cases, driving greater demand. population; China is set to overtake as regulatory hurdles may prove the U.S. as the world's biggest retail challenging for What’s more, by lowering barriers to entry market by 2016. brands in this region. Winners expanding and removing the need for a physical presence in remote or underdeveloped areas, • China has the world’s largest online • Retailers must innovate and use Despite the challenges, and against online retailing is giving traditional retailers population and Asia's most vibrant data strategically to understand this fragmented backdrop, some of the opportunity to expand more rapidly. This, e-commerce sector. the customer—or suffer potential this year’s most valuable Asian retail of course, also increases the competitive decline as competition increases.

104 Best Retail Brands 2014 Wo oolw rths Lotte Department Store Australia Korea Grocery Department Store $4,948M $1,840M +8% -8%

Drawn into a price war with its closest efficiencies, building new growth Since 1979, Lotte has modernized sustainability commitment includes competitor, Coles, the launch of “more businesses, and online sales, which distribution and the department store reducing paper use by promoting its savings every day” has Australia’s largest exceeded A$1 billion (USD $915) for the business in Korea. Customer service, online “eco flyer,” which has since grocer working against the premium first time in 2013, it’s also in the midst marketing, Corporate Citizenship, and evolved since 2011 to a mobile app, as image it’s been crafting since its last of converting its liquor stores to its BWS accessibility—including a valet service well as launching an eco-shop that sells rebrand. However, the introduction of (Beer Wine Spirits) format. Forays into for pregnant women and videophones a range of earth-friendly products and more health-conscious fare and a new selling insurance and mobile phone for hearing impaired customers—are donates proceeds to an environmental partnership with celebrity chef Jamie plans have been less successful, however, cornerstones of the Lotte brand. As a fund. Owner Lotte Shopping Corp. Oliver shows Woolworths living up suggesting that the Woolworths brand result of its efforts to accommodate (which acquired discount electronics to its “Australia’s Fresh Food People” may not be completely aligned with the customers with disabilities and limited retailer Himart in 2012) is the world's positioning. With a focus on driving business vision. mobility, its stores received “Barrier-free third-largest department store operator, Building Certification.” Its wide-ranging according to Forbes.

Uniqlo Chow Tai Fook Japan China Apparel Specialist $4,160M $1,834M +14% NEW

Japan’s most valuable retail brand region are vital in that plan. So is the Founded in 1929, the Hong Kong-based brand has taken bold steps to expand its continues its impressive growth. With U.S., where Forever21 veteran Larry Meyer Chow Tai Fook is the world’s largest business, from investing in production, a solid base in its home country and is overseeing an aggressive rollout of 100 jeweler, with about US$7.4 billion in expanding its sales network in third a growing global presence of over 500 stores and tweaking its “Made For All” sales in 2013 and over 2,000 points of and fourth tier cities, to co-branding stores, Uniqlo aims to become the world’s sizing for America. With plans to localize sale, primarily in China, Singapore, with leading players in the fashion biggest apparel retailer by 2020 (hence 10 percent of its designs and test price and Malaysia. Offering items at all price industry. Facing a booming e-commerce parent Fast Retailing’s interest in adding points in Asia, it faces a key challenge: to points, from mass to luxury, it has long market, Chow Tai Fook has developed an brands such as J.Crew to its stable). maintain its brand promise of affordable enjoyed a reputation for superior quality, e-commerce platform and is exploring As the brand’s new Shanghai flagship fashion without diminishing quality. partly driven by its iconic 99.99 percent social channels like Weixin to better indicates, China and the Asia-Pacific pure gold products. In recent years, the engage with customers.

Coles FairPrice Australia Singapore Grocery Grocery $4,061M $1,519M +11% +1%

Coles has firmly cemented its position People” tagline, Coles is promoting the Singapore’s largest domestic competes strongly on value, but also around lowest prices with its “Down, quality of its produce and more ethically supermarket, FairPrice continues to stay continues to strengthen its brand down, prices are down” campaign. This sourced products. As the century-old true to its purpose four decades after it image through such efforts as an online perception has dominated the grocery retailer embarks on a massive USD was founded as a social enterprise that video channel, “Food for Life.” These brand for the last year and is giving $985 million (A$1.1 billion) expansion aims to temper the cost of living. “A initiatives, on top of continuous efforts to Coles an edge in its price war with rival program, its challenge will be to world-class retailer with a heart,” the stay relevant by offering more convenient Woolworths. However, Germany’s rapidly maintain its price positioning and quality brand manifests its Corporate Citizenship payment options and passing along the growing supermarket chain, Aldi, is also food commitment, without having to commitment through the way it treats savings from self-checkout counters and a player in Australia’s low-cost space. switch awkwardly between the two, its employees, charitable giving, and warehouse automation—the first of its adding to the competition. In an effort to as it is currently. its affordable private-label products. In kind in Asia-Pacific—are cementing the challenge Woolworths on its “Fresh Food a largely price-driven sector, FairPrice brand’s positioning.

106 Best Retail Brands 2014 Lawson Matahari Japan Indonesia Convenience Store Department Store $1,313M $963M +13% +11%

Differentiating itself from competitors boon to Japan’s aging population. It has Indonesia’s oldest and largest department is popular with young people and has remains a key component of Lawson’s also entered the agricultural market store, operating 125 stores in 61 cities, increased Matahari’s relevancy to this strategy. With food products being the with Lawson Farms, a cooperative effort Matahari continues to stay ahead of segment. In 2013, Matahari was also brand’s main offering, understanding to procure and produce its own raw competitors. Targeting the middle- recognized as a provider of quality service consumer preferences in this area has materials, as opposed to just selling. income segment, Matahari is known for and customer satisfaction. Reporting that become critical to delivering a unique To achieve high levels of responsiveness, offering stylish, high quality products net profit for 2013 was up 49 percent over a and relevant experience. Lawson has Lawson relies on sophisticated analytics at affordable prices. Its improved year earlier, the brand continues to meet expanded its MACHI café fresh-brew from the point card data of over 57 million merchandising strategy includes the expectations of customers across the coffee offering and is increasing the customers to manage store performance, Indonesia-sourced merchandise and country through new and refurbished number of in-store kitchen facilities optimize individual store offerings, and private-label brands such as Nevada—an stores and the opening of a customer call that provide freshly prepared meals—a identify new store opening opportunities. exclusive brand sold in Matahari that service center.

Bunnings Warehouse Parkson Australia Malaysia Home Improvement Department Store $1,169M $801M +6% -32%

Well-positioned to capitalize on capabilities, its website was revamped Malaysian retailer Parkson is working closure of three Malaysian stores for Australians’ passion for DIY home this year with a focus on two areas, toward its vision of becoming Asia’s renovations. Going forward, Parkson projects, Bunnings Warehouse continues “Our product range” and “DIY advice,” leading department store operator. With must maintain the efficiency of its to dominate the home improvement to reflect the in-store experience. With a diverse footprint that reaches across operations and work to stay relevant category. The brand’s only challenge an impressive presence and community China, Vietnam, Indonesia, Sri Lanka, and differentiated in various markets. has come from Woolworths’ Masters engagement strategy, Bunnings must Myanmar, and soon, Cambodia, Parkson Making progress in that direction, brand, but it’s not worried. As part of the be mindful of competitors that seek to is facing the continual challenge of the brand launched the Parkson Star Wesfarmers group, the big box retailer emulate its success and business model, adapting to its regional audiences while e-learning program in 2013 to train has built an enviable reputation based as this could dilute the brand’s image if it managing the costs of its overseas employees in order to improve internal on strong community and consumer expands (as it’s doing in Queensland) but expansion. The brand’s 2013 performance brand engagement and the customer engagement. To fortify its multichannel does not evolve. was affected by the decline in operating experience. margins from China and the temporary

SM FamilyMart The Philippines Japan Department Store Convenience Store $1,041M $755M +11% +17%

SM has performed well despite the game with the 48 malls it operates in the Although currently the third largest there are opportunities to expand in growing strength of local competitors Philippines and five malls in China. At convenience store chain in Japan, China and fast-growing Southeast Asian and the emergence of both regional and home, the 2013 opening of the SM Aura FamilyMart has an aggressive goal to markets. Given the intense competition international players. As the leading Premier mall generated buzz as “The New become the world’s number one chain. in Japan, continuing to differentiate retailer in the Philippines, SM continues Urban Market,” offering international With a presence in eight countries and through a strengthened private brand to expand and now has over 200 stores gourmet fare as well as locally produced over half of its 20,000 plus stores outside lineup, distinctive food items like consisting of The SM Store (department favorites from different provinces, its home market, there is a solid platform Famima Premium Chicken, and high stores), supermarkets, hypermarkets, providing an around-the-world shopping in place to make this possible. While quality service standards are crucial and neighborhood grocery stores. With experience—a unique and much the brand already has a strong presence to solidifying its position within the a clear goal to become a world-class welcomed concept in the Philippines. in South Korea, Taiwan, and Thailand, domestic market and beyond. Filipino retailer, SM is stepping up its

108 Best Retail Brands 2014 Tanishq Harvey Norman India Australia Specialist Department Store $670M $620M NEW -3%

The world’s largest gold-consuming trust and purity were natural key Harvey Norman’s home furniture and ultimately the brand lacks humanity. nation had no national jewelry chain messages at launch. However, the brand electrical stores face the challenge of Toward the end of 2013, a marketing until 1994, when Tanishq launched quickly moved to design-led themes managing a coherent and consistent campaign focused on “real” customers and helped create a branded jewelry that helped change the way India brand across a franchise model. With a and staff (instead of financing) market in India. The brand initially looked at jewelry. The lightweight and proposition focused on making financing demonstrated that Harvey Norman targeted the American and European inexpensive Mia Collection, for instance, easily accessible, the Australian-based may have recognized the need to bring markets before focusing on its home made jewelry an everyday item for chain is less known for its product offer more warmth to its brand. However, market, where it now operates a robust women, not just something for special or customer service standards. The store’s such communications will have little website and 157 stores in 89 cities. Part occasions. As a result, its marketing and founder, entrepreneur Gerry Harvey, meaningful impact if no effort is made of the Tata corporate family, which communications campaigns have been has gained some recognition for the to create a valuable customer experience emphasizes “leadership with trust,” recognized at India’s Effie Awards. brand from his media appearances, but to back up such claims.

Big C emart Thailand Korea Grocery Mass Merchant $653M $613M +15% NEW

Big C made big strides in the past year. was converted into a Big C store, with The leading Korean discount retailer while its “sunny sale” campaign featured Internally, the Thai supermarket brand mobile shopping enabled by QR codes. has been a pioneer for more than 20 the world's first shadow-generated QR launched its Big C Academy to improve Showcasing leadership in retail and years. Aiming to benefit producers and code: The sun’s shadow at noon forms training and improve the level of digital, Big C launched a full suite of consumers through improvements to a QR code, allowing smartphone users service delivery across its retail formats. digital shopping platforms, including distribution, its Fresh Center is the to connect to the emart mall and receive Externally, Big C doubled its convenience a website, mobile app/QR code and call nation’s largest agricultural products coupons. In another innovation, its store presence and launched Asia’s first centers—and its effort has been rewarded distribution and storage center, stabilizing Flying Store brought free Wi-Fi to malls moving virtual store. A local BTS SkyTrain with a massive increase in online sales. prices and enabling longer food storage. via helium-filled balloons to encourage It’s also aligning loyalty, promotion and shoppers to use their smartphones— payments via mobile. Using GPS, its app and connect them, naturally, to its literally guides shoppers to in-store sales, e-commerce site.

Muji Hyundai Department Store Japan Korea Specialist Department Store $630M $601M +28% +1%

As Muji successfully grows its global clever executions. One iteration of the Established in 1971, the Korean blood cancer. In-store, the brand has presence including expanding in the campaign saw Muji and Japan’s ANA department store chain has shifted pursued differentiated food-court zoning, US, China remains a key focus for the airline using 3D printing to interesting its focus from providing shopping strengthening its bakery shop and Japanese home and lifestyle brand. This effect—scanning shoppers and flying a convenience to improving the quality dessert offering. Overall, it has focused fiscal year, Muji opened a flagship store family to meet miniature 3D versions of people's lives. It operates the nation’s on developing a differentiated, premium in Shanghai, launched an e-commerce of themselves. Increasing its digital oldest community-based cultural center image to improve competitiveness, site, and set the goal to grow its presence presence, the retailer’s “MUJI Passport” and regularly hosts events such as a relying on foreign luxury branded goods to 100 stores. Meanwhile, cross- app, which enables in-store and online blood donation drive that saw more to create high-end appeal. As a result, it platform promotions are bearing fruit. shopping, has passed more than 750,000 than 10,000 people participate and a is the number one shopping destination Campaigns such as the “MUJI to GO” downloads since launching in May 2013. “green market” whose proceeds support in Seoul’s upmarket Gangnam district. effort married marketing efficiency with the medical expenses of children with

110 Best Retail Brands 2014 Myer Suning Australia China Department Store Electronics $584M $511M -7% -7%

As competition increases from overseas previous edge with its brand exclusivity Suning aims to transform from China’s competitors by successfully embodying giants Zara and Topshop, with new model has been undermined by the web, biggest home appliance and electronics a new brand proposition, “young and entrants H&M and Uniqlo entering yet significant investment in its own retailer into a multi-category supplier daring.” Through its sponsorship of Australia this year, Myer must work website has not boosted its e-commerce of insurance, international express entertainment programs, celebrity hard to keep itself from losing relevance. sales and it has only reached parity with delivery, and other services with a more endorsements, and the “Dream Come Perceived as being more premium than other online retailers. The company fully integrated online/offline presence. True” short film, the brand appeals mid-tier Target, but not as premium expanded its “MYER one” loyalty program It’s stepping up the pace of store to the dreams and aspirations of its as direct competitor David Jones, Myer to other chains, while it remains to be upgrades and investing in cloud-based customers. Suning’s brand value has has not delivered on the proposition “to seen if chatter of a merger with rival computing technology to seamlessly dropped slightly, however, mostly delight and inspire our customers.” Its David Jones comes to fruition. integrate its online channel and various due to increased competition in the brick and mortar store formats. Suning marketplace and lower profit margins has further differentiated itself from after standardizing its prices.

Big W Target Australia Australia Mass Merchant Mass Merchant $579M $511M +3% -5%

Woolworths has stated that it is brand. However, its late 2013 “Fashion at The Wesfarmers-owned Target Australia This suggests that Target has lost touch transforming its Big W brand, but there low prices” campaign introduced a look is struggling to find a foothold in the with its customers, who want quality is not much sign of change externally, and feel that did not seem to align with country’s competitive retail environment. design and affordability. Its urban- as the business model and store formats its family-oriented image. Big W needs Perceived as a mid-tier department store, focused marketing doesn’t align with its remain the same and its CEO admits to first decide what defines its brand and the fashion cues that have defined the strong rural presence, revealing another results have been “patchy.” Building on positioning, and then adopt a platform brand in the past no longer resonate area where the brand lacks relevance. The its “Australia’s lowest prices” positioning, that is truly distinctive and stick with with consumers. British celebrity stylist size of the chain may protect it, but the Big W continued to use its “Cha-ching” it—especially with competitors such as Gok Wan was hired in 2013 to rebuild the brand needs to reconnect with customers catchphrase and hired Eric Stonestreet of Kmart nipping at its heels. brand’s fashion credentials, but the move to thrive in an increasingly turbulent the TV show Modern Family to endorse the was undermined by a messaging faux retail environment. pas and continued discounting.

Kmart David Jones Australia Australia Mass Merchant Department Store $555M $426M +8% -17%

Kmart Australia’s new focus is paying range. With advertising highlighting In business since 1838, the high-end omnichannel strategy has progressed off. Its shift toward perceived value for the value of Kmart products and as department store leans heavily on with its online channel upgrading essentials is a welcome change for the the only Australian apparel retailer to heritage to drive sales. Yet increasing delivery convenience, generating more country’s family-oriented retail market. disclose its Bangladeshi factories, the competition from overseas retailers, traffic, and ranking more prominently This has led to more thoughtful curation brand is winning over new consumers both online and offline, and a waning on search results. But, overall, headway of its private label product range and a and gaining mind share. After four years reputation for customer service is is slow going and these steps alone will revamped in-store experience. While of double-digit earnings growth, if the rendering David Jone’s “house of brands” not compensate for the competitive not all stores have been upgraded, Wesfarmers-owned Kmart can retain its proposition less relevant. However, there challenges that David Jones faces, this marked a visible change from focus in Australia, it will continue to pull are signs that indicate the brand may which may make rival Myer’s case for a presenting products in quantity to a away from competitors. be making some constructive changes, merger between the brands all the more focus on specific value for each product even as its profit margins decline. Its compelling for its board to accept.

112 Best Retail Brands 2014 Nitori ABC-Mart Japan Japan Home Furnishings Apparel $403M $350M +22% NEW

Global expansion was the big news for chain. The company is also investing in One of Japan's leading footwear retailers, the U.S. market. With approximately half Japan’s leading home furniture and overseas resources to fuel its business ABC-Mart has seen fast growth over the of domestic sales coming from its own interior goods chain with the October model, which integrates production and last decade, expanding from 166 stores branded products, the company delivers opening of two “Aki-Home” stores in sales, and establish a basis for growth in in 2003 to more than 800 stores in 2013. impressive margins and has cleverly California. Although Nitori’s first store new overseas markets. However, with a Increasingly, the brand is looking to built its brand by offering both domestic outside Japan opened in Taiwan in 2007, consumption tax increase on the horizon expand internationally and has a growing brands and licensed brands alongside the move is symbolic as it was on a trip and a weakened yen, Nitori will have to presence in Asia, including South Korea each other. Adding to its portfolio to to California where founder Akio Nitori utilize all of its efficiencies to absorb costs and Taiwan. Its 2012 acquisition of increase in-house sales and offering got the inspiration to expand his original rather than pass them on to shoppers. America’s LaCrosse footwear brand has higher priced private brands will help to store into Japan’s premier furniture also helped the brand establish itself in fuel ABC-Mart’s ongoing growth.

Belle Himart China Korea Apparel Electronics $402M $348M +17% NEW

Established in 1992, Belle is China’s products in 2013. However, the added Himart has a market share of about customers. Himart also takes Corporate largest seller of women’s footwear. While variety failed to bring significant growth, 47 percent in Korea’s electronics retail Citizenship seriously. The "Good Morning the market demand remains soft, Belle as competition has become extremely industry. The keys to its success are high Children" cause marketing campaign, for outperforms its apparel competitors fierce in e-commerce. Buoyed by a shift brand awareness and a sophisticated example, encouraged customer donations with a multi-brand strategy that covers from discounting in 2013, it still needs to distribution network, supported by to support educational programs. The all segments in the market and a well- align its sub-brands to achieve precision owner Lotte’s distribution capabilities. company also supports the construction established distribution network. Belle targeting, avoid cannibalization, and Himart is also characterized by its high of basic infrastructure in Kenya to help started its online business (yougou.com) maximize market share. To sustain sales per store. By launching in-store change the lives of children in the region, as a shoe retailer in 2009, but extended brand loyalty, Belle must work harder boutiques with Lotte Mart, the nation’s and provides financial and emotional its offering to include clothes, luggage to fulfill its brand promise and improve largest distribution company, Himart support to single parent families through and bags, outdoor items, and children’s product quality. increased its points of contact with more its “Happiness of 3” campaign.

JB Hi-Fi Hyundai Home Shopping Australia Korea Electronics Mass Merchant $378M $334M +13% +10%

Despite an industry-wide decline in second half 2013 sales rose 6.8 percent and Seoul-based Hyundai Home Shopping its partnership with Basic House and physical music and entertainment sales, online sales increased 15.4 percent. One provides high quality products at merges on- and offline promotions to the JB Hi-Fi consumer electronics chain key challenge will be to align the passion reasonable prices to customers through continually expand. Since 2009, the cross- is growing. It’s expanding its NOW- of its youthful employees with the level of its TV network, HMall website, mobile channel emporium has provided strategic branded digital sales of music, books and service and expertise demanded by high- app, and catalog business. With the goal investments to small and medium-sized movies and looking at online rentals, and tech shoppers. As it continue spreading of being a global home shopping leader, startups to spur innovation. The company adding appliances to its product mix by across Australia and New Zealand, it opened the industry’s first “quality also offers the opportunity of free converting a handful of stores to its JB the JB Hi-Fi brand must be nurtured institute” in 2007, under the belief that broadcasting in order to showcase worthy Hi-Fi HOME sub-brand. Leveraging its strategically or risk becoming little more strict quality control is the basis of service products from small businesses with reputation as a specialty discount retailer, than a value price player. and trust formation with customers. It limited marketing budgets. sells exclusive fashion brands such as

114 Best Retail Brands 2014 -21% -29% +8% NEW NEW latinA MERICA $3,156M $2,615M $1,016M $547M $485M

+10% NEW NEW -30% -11% $420M $381M $366M $357M $320M Across the diverse terrain of Latin America with its growing middle class, the retail industry has seen impressive changes and an increase in consumer -26% -18% +23% NEW NEW $319M $263M $261M $246M $173M spending. Despite economic uncertainty and a degree of political and social turmoil, retailers— particularly apparel and supermarket brands— NEW -5% -22% 0% NEW had strong financial results in 2013. Due to this $160M $159M $147M $147M $124M performance, Interbrand is ranking the 20 most valuable Latin American retail brands for the first time ever. R ndeTAIL a E-tailing

By Gonzalo Brujó, Chairman of Interbrand Latin America & Iberia & André Matias, Brand Strategy Director & Head of Brand Valuation, Interbrand São Paulo

Across the diverse terrain of Latin America with its growing middle class, the retail industry has seen impressive changes and an increase in consumer spending. Despite economic uncertainty LaTin and a degree of political and A m

social turmoil, Latin American erica retail brands remain relevant.

Most retailers in the region had of the leading Latin American retail New revenue streams These options not only make purchasing #BESTRETAILBRANDS strong financial results in 2013, but the brands. As the middle class increases easier for customers, they also boost devaluation of local currencies in the its purchasing power and foreign Major retailers are income for retailers. Renner, Liverpool, majority of Latin American countries competitors with high service standards moving beyond their Casas Bahia, Lojas Americanas, Extra, had a negative impact on brand value. continue to enter the market, consumer and Elektra are only some of the retail expectations are rising. In this context, core businesses and are brands that are already benefitting from While sectors such as home the winning retail brands are those increasingly profiting offering payment solutions to customers. improvement, furniture retailers, that provide a consistent and pleasant electronics, and specialty goods are customer experience. from the credit card and Latin America’s leading retailers are fighting to find their place amongst financing businesses. expanding the ways in which they the top Latin American retail brands, Chile’s Falabella department store chain With the middle class commercialize in order to bring more supermarket and apparel brands are exemplifies how to use good service to convenience and better service to their the best-represented sectors on the stand out in its category and create a growing at such a rapid customers. Bodega Aurrera, a Mexican table this year. bond with customers. Mexico’s Superama rate, many retailers are supermarket brand that is majority has also effectively embedded service owned by Wal-Mart, for instance, has into its brand’s essence. While freshness, helping customers finance three different types of stores that allow What consumers value most variety and high quality offerings also in-store purchases as it to adapt its offer to local consumers: differentiate the Mexican supermarket Bodega Aurrera, located in popular areas Although there are still many challenges brand, service has been a key brand well as offering debit and with less than 100,000 inhabitants, and bureaucratization continues to pose ingredient, both in traditional and credit cards to help them Mi Bodega Aurrerá, located in lower- obstacles, service is the main strength digital channels. with payments outside income areas, and Bodega Aurrera Express, an urban concept targeting the store. busy areas in bigger cities.

118 Best Retail Brands 2014 Similarly, Brazil’s Extra has expanded Banamex and Visa, which offers special from hypermarkets to gas stations, promotions and helps customers pay for drugstores, supermarkets, and Oxxo purchases, purchases made through neighborhood markets. Its digital store other online Mexican retailers, as well also has a strong online presence. as those made through establishments affiliated with Visa.

Expanding into digital e-tailing In the Brazilian market, Extra, Lojas Americanas, Ponto Frio, and Pão de Latin American retailers are also taking Açúcar are also investing in digital advantage of the region’s increased channels to expand sales and offer internet and broadband penetration more convenience to customers. rate to shift more selling online. According to comScore’s 2013 Latin America Digital Future in Focus report, this was the Untapped retail potential fastest-growing region for internet users, with a 12 percent increase over 2012. However promising the retail market By comparison, Asia-Pacific’s web- remains in Latin America, there is room Natura using population increased by 7 percent, for improvement. The sheer pace of Brazil Europe’s by 5 percent, and the Middle growth will leave brands with no choice Specialist East and Africa by 3 percent. but to become more responsive in order $3,156M -21% to stay relevant and add differentiating E-commerce is becoming more prevalent value, especially in terms of integrating in the region, and adapting retail formats the online and physical retail experience. The eco-friendly cosmetics giant for being. As a result, it is recognized to accommodate this shift in consumer Natura remains the most valuable for its ethics, sustainable practices, and preferences is proving to be the key to While not included in Best Retail Brands retail brand in Brazil. Among its main for promoting wellness in Brazil and success for many retailers. For instance, 2014, brands such as Coto and La Anónima strengths are the clarity of its brand beyond. As innovative as it is ethical, Mexican convenience store Oxxo has supermarkets—as well as Frávega and proposition and the consistency of the Natura’s large investments in R&D have demonstrated its ability to keep up Garbarino in Argentina; Benavides and customer experience it delivers—even paid off handsomely, garnering the with consumer preferences by creating El Palacio de Hierro in Mexico; Plaza Vea, in a tough economy. From its clear and company numerous awards and even mobile apps. “Oxxo siempre ahí” points Bembos, and Supermercados Peruanos in relevant name to its inspiring campaigns earning it a 10th place spot on Forbes’ consumers to the closest Oxxo locations Peru; Pollo Campero in Guatemala and and music sponsorships, everything The Most Innovative Companies in the while a mobile game called “Raining Bitz” El Corral in Colombia—are all proving produced by Natura relates to its reason World ranking. entertains them. The store also launched how much potential there really is for the a debit card, Saldazo, in partnership with retail sector in Latin America. Oxxo Mexico Convenience store S UmmARY $2,615M -29%

• With a growing middle class and • To meet rising consumer an increase in consumer spending, expectations, brands are improving Oxxo, the undisputed leader in Mexico’s products, including many proprietary most retailers are seeing strong service in both traditional and convenience store category, now accounts brands, and staying open 24/7, 365 days a financial results digital channels for about 7 percent of grocery sales in year to fulfill its brand promise, “Always the country. Despite a tough economy, ready, always there.” In order to bring • Supermarket and apparel brands are • Major retailers (Renner, Casas it is rapidly expanding—owner Fomento even more convenience to its customers, particularly strong in the region Bahia, Lojas Americanas, Extra, Economico Mexicano (Femsa) opened it has forged an alliance to bring banking etc.) are using lending (credit cards 1,120 stores in 2013, an average of three services to its stores, and stands to benefit and financing) to increase revenue daily for a total of 11,721—and serving from Femsa’s planned USD $1.35 billion as well as customer loyalty millions of customers. It’s also responsive investment across its businesses. to local needs, offering a large variety of

120 Best Retail Brands 2014 Bodega Aurrera Casas Bahia Mexico Brazil Grocery Home Furnishings $1,016M $420M +8% +10%

Bodega Aurrera is a strong self-service relatable character generates empathy for The Brazilian furniture and appliances invested in expanding its operations format owned by Wal-Mart in Mexico, the brand along with high expectations, retailer continues to strengthen its values in the north and northeast regions of where the company’s net sales (also which Bodega Aurrera shows it is capable and clarify the role it plays in people’s Brazil, with a plan to open 25 more stores encompassing Superama and Walmart of meeting by offering guarantees lives: making their dreams come true and by the end of the year. The consistency Supercenters) increased 3.1 percent last and promotions to reinforce its price providing the best shopping experience. of its communication and the strength year. The brand’s value proposition of leadership and the brand’s credibility in In order to fulfill that promise, the brand of its business model prompted the offering the lowest prices in the market is the country. By making a vast variety of has invested approximately USD $700 newspaper Folha de S. Paulo to grant Casas embodied by its iconic character “Mamá products available at affordable prices, million in advertising, which made Bahia a Top of Mind award in the home Lucha,” a Mexican wrestler/housewife Bodega Aurrera has become an ally of low- it the second largest advertiser in its appliances category. who fights for low prices in a series income Mexican families. home market in 2013. The company also of popular ad campaigns. The highly

Falabella Sodimac Chile Chile Department store Home Improvement $547M $381M NEW NEW

Founded in 1889 by Salvatore Falabella, courage to set down roots in the region, Sodimac provides construction, the key to the brand’s success. Sodimac the store that began as a tailor shop is Falabella became a great ally of Latin hardware, and home products and has implemented a successful market now one of the largest retailers in South American women. Synonymous with services. The leader in its category, it has segmentation strategy to meet the needs America. There are currently 89 stores trust and expertise, in addition to the vast pioneered a comprehensive offer that of different audiences (homeowners, in four countries, with reported revenue array of brands, products, and services smaller hardware and specialty stores builders, and businesses) through of USD $4.42 million, and an ambitious (from banking to travel) it offers, it has are unable to match. Sodimac brought various store formats and sub-brands. expansion plan for the next five years. By become the answer to many consumers in a revenue of USD $5.343 million in Continuing its strong expansion strategy, providing access to a world of affordable who are seeking to fulfill the needs of 2012 and operates more than 135 stores in Sodimac purchased 50.1 percent of Brazil’s design at a time when few brands had the everyday life. Chile, Argentina, Colombia, and Peru. Dicico chain and is making inroads into Providing customers with all the tools new markets such as Uruguay and Brazil. and supplies they need in one place is

Liverpool Elektra Mexico Mexico Department store Electronics $485M $366M NEW NEW

Liverpool is the largest department extras such as gourmet food. Liverpool Elektra knows how to respond to the Azteca, which has a presence in most store chain in Mexico. The brand has also demonstrates that it’s up-to-date needs of the base of the pyramid in Latin of Elektra stores, offering an additional received high levels of investment, with fashion trends by hosting the America, a market that represents huge value to its customers. Last year, mainly focusing on opening new annual Fashion Fest event, replete with growth opportunities because of its size. Elektra acquired the video rental chain stores and remodeling old ones. It celebrity spokespeople. The retailer has A leading specialty retailer and financial Blockbuster Mexico, which will help the has nearly 100 stores across Mexico, also taken advantage of the credit card services company, Elektra focuses on brand expand its locations across the catering to the middle class families market, which has helped it become the enhancing quality of life through its country and reach untapped markets. that represent the country’s social third most important credit card issuer product offerings and by making credit Elektra plans to replicate this successful and economic foundation. In-store, it in Mexico, and is bringing U.S. brand accessible. Elektra is supported by Banco model in other parts of the world. offers a complete shopping experience, Chico’s into the market via a partnership including (in some locations) luxurious this year.

122 Best Retail Brands 2014 Renner Extra Brazil Brazil Apparel Mass merchant $357M $263M -30% -18%

With 16 percent market share and declared they were satisfied in 2012. To Extra remains one of Grupo Pão de a more emotional chord. In the digital a business strategy focused on further enhance customer satisfaction, Açucar’s most powerful flagship brands, space, the brand’s presence is getting enchanting consumers, the second Renner has expanded its portfolio of representing approximately 33 percent stronger. In a recent move, the portal largest department store chain in Brazil, brands. Today there are six sub-brands, of the group’s revenues. The positioning extra.com has evolved from a standard Renner, continues to lead in its category segmented by lifestyle and according to “More for Family Life,” launched in 2011, retail site to a virtual mall, comparable to domestically. To the brand’s credit, different fashion and marketing trends. continues to be expressed at all of the the U.S.-based Amazon.com. The brand its actions are well aligned with its Boasting a growing presence on social brand’s key touchpoints, from collateral also expanded its Minimarket Extra strategy to delight consumers at every media as well, Renner placed among the to TV and internet. Since Extra faces stiff neighborhood grocery stores, supplying touch point. In fact, according to the top ten on IndexSocial’s Engagement competition from brands in its category a demand for nearby stores and creating company’s annual report, 96.6 percent of Ranking in 2013. that emphasize price and promotion, the greater proximity with consumers. customers among the 22.5 million polled challenge is to differentiate by touching

Lojs a Americanas Hering Brazil Brazil Convenience store Apparel $320M $261M -11% +23%

After 84 years of existence, Lojas of the year, such as Mother’s Day and In Brazil, Hering is the clothing brand priced pieces, while continuing to Americanas has become one of the Easter. On the digital front, the brand that many have worn “since always.” It deliver the value its customers expect. leading brands in Brazil’s retail market— invested in its website’s distribution is democratic, versatile, and appeals to Despite its franchise model, the brand and its in-store experience is the reason and after sales services, achieving an people of all ages, across all social classes. remains admirably consistent. From its positive image continues to grow. impressive 59 percent reduction in In the market for over 130 years, the its physical stores to e-commerce, With a strong focus on convenience, the complaints to the Brazilian Consumer brand has constantly evolved without Hering’s communications are simple, brand excels at offering the right products Protection Organization. The retailer was diluting its identity. Though traditionally straightforward, and well aligned. at the right time, to the right audience. also honored with a Top of Mind award known for its casual basics, Hering has The brand is also consistent in the area Its communications are primarily focused for e-commerce by the newspaper Folha de recently increased the perceived value of Corporate Citizenship, which is an on promotions related to specific events S. Paulo—for the seventh time. of its products. In that vein, it plans to integral part of Hering’s DNA. expand its offerings to include higher

Superama Éxito Mexico Colombia Grocery Mass merchant $319M $246M -26% NEW

Superama fulfills its “Superama brand’s mobile app, which is available With more than 225 supermarkets, wider range of products at better prices. pampers you” promise by meeting its for most smartphones. The app stands hypermarkets, and convenience stores, Additionally, Éxito has become a player customers’ expectations for good service, out from others in the supermarket Éxito is Colombia’s leading retailer. in the mobile phone business via Movil variety, freshness, and convenience. category because it offers unique features Going strong for more than 60 years, its Éxito and partnered with market leaders The brand targets consumers of higher and functions such as barcode and QR success is rooted in its solid commitments SURA, Bancolombia, and Avianca to socioeconomic status, and proves to have scanning, and automatic shopping lists to its employees, suppliers (90 percent create insurance services (Seguros a broad understanding of this segment’s based on previous purchases. From digital domestic), and customers. While Éxito Éxito), a credit card (tarjeta Éxito), and interconnected and busy lifestyle. In innovation to customer experience, the is already preferred for the variety of travel services (Viajes Éxito). With so fact, for some time now, Superama has retailer’s combined efforts have kept products, formats, and services it offers, much growth underway, Éxito’s biggest been working to develop more digital Superama ahead in Mexico’s premium the brand has also invested heavily in challenge ahead is likely to be the shopping experiences. Proof of this is the supermarket category. an online sales platform to provide a internationalization of its brand.

124 Best Retail Brands 2014 Suburbia Pão de Açúcar Mexico Brazil Apparel Grocery $173M $147M NEW -22%

Living up to its “Fashion for real life” building its social media presence in The value of Pão de Açucar’s brand lies commitment to innovation. The brand slogan, Suburbia offers a place where recent years, Suburbia found success in its ability to deliver “happiness.” is also increasingly committed to the whole family can shop for trendy with its “style guide” blog, which has As such, it enjoys a premium position, sustainability, a concept that is clearly clothing at accessible prices. While the increased traffic to its stores. Last year which justifies higher average price understood, lived internally, and brand focuses on delivering fashion at the alone, sales grew 13 percent. With a points than larger supermarket chains. evidenced by the company’s wellness best prices to middle- and lower-income total of 108 locations, Suburbia now has Willing to adopt retail models that initiatives for employees. On the strength segments, it does so without sacrificing more stores than any other clothing have never been tested in the Brazilian of ad campaign in 2013, it appears Pão de quality or variety. Investing heavily in retailer in Mexico. market, the expansion of Pão de Açucar Açucar may soon be reaping the benefits Delivery, the launch of the drive- of improved communications and a thru model, and the brand’s Virtual stronger brand. Showcase demonstrate Pão de Açucar’s

Tottus Ponto Frio Chile Brazil Mass merchant Electronics $160M $147M NEW 0%

Established in Peru in 2002, the Tottus strengthen its own brands (representing After abandoning its “all at the lowest portfolio, inaugurating concept stores, chain of hypermarkets and supermarkets over 500 products) and aggressively price” discount approach in 2010, home and developing new campaigns to ensure is a brand owned by Chilean retailer push to open stores in new locations, appliances retailer Ponto Frio is pursuing that it delivers technology and innovation Falabella. Its target audience is the the company is in a process of constant a strategy built around premium. The at every point of contact. Working hard modern, multitasking woman who expansion. Tottus’s outward and upward positioning is still evolving, but the brand to make the new positioning feel real juggles her time between home, work, trajectory, however, is in line with the is now targeting the growing middle and authentic, Ponto Frio is listening and shopping. As of 2012, the brand saw internationalization strategy of the class and upper classes with a fresh visual to consumers and responding to their its revenues increase by 23 percent. That Falabella group, which announced its brand identity and a new slogan, “Live preferences, while finding clearer, same year, it commanded 27 percent growth plan for the 2014-2017 period the innovation.” Though Ponto Frio is more consistent ways to align its brand market share in Chile and seven percent with an investment of approximately successfully building its presence on communications at various touchpoints. in Peru. With continual efforts to USD $4,100 million for the holding. social media, the brand is reassessing its

Havaianas Arezzo Brazil Brazil Apparel Apparel $159M $124M -5% NEW

Weaving humor, “Brazilian–ness,” relevant. A household staple in its Whether keeping up with trends or in new stores and building its presence and variety into its brand and products, country of origin, Havaianas sandals are setting new ones, Arezzo builds its on social networks. Bearing testament Havaianas has become a global sensation. considered the quintessential flip-flop in following by launching glamorous to the brand’s reputation online, Arezzo Though the flip flop pioneers began with Brazil, but the brand is also increasing campaigns, investing in bloggers and has 1.3 million fans on Facebook and a limited portfolio, today Havaianas its recognition abroad. For instance, 91 opinion-makers, and promoting its goods ranked fourth in indexSocial’s 2013 social has extended its product mix beyond percent of Australians and 55 percent of via pop-up stores in locations like Oscar engagement ranking. Under the direction sandals, offering stylish espadrilles, Europeans are aware of the Havaianas Freire Street (often billed as Brazil’s Rodeo of a new president, Alexandre Birman, sneakers, handbags and even towels. brand. Taking its quest for worldwide Drive). Arezzo is the largest women’s shoe Arezzo is now looking outside of Brazil to Its colorful magazine ads, celebrity recognition further, the brand plans to brand in Latin America and it continued help sustain revenue growth that’s five TV endorsements, and in–store brand not only open 90 new stores in Brazil, its expansion throughout 2013, investing times the global industry’s average. experience keep the brand fresh and but also many others abroad.

126 Best Retail Brands 2014 MTOE H DOLOGY

There are three key components in the four regional valuations for Best Retail Brands 2014: analyses of the financial performance of the retailer, the role the brand plays in the purchase decision, and the competitive strength of the brand. For example, while Apple was Customers rely more on brands to guide Meto h dology considered, it failed to meet this their choice when competing products requirement. In addition, we limit or services cannot be easily compared or the list to those traditional stores contrasted, and trust is deferred to the By Mike Rocha, Global Director of Valuation, Interbrand and e-commerce sites that sell goods. brand (e.g. organic foods), or where their In order to focus on traditional retail, needs are emotional, such as making we have excluded restaurants, a statement about their personality Interbrand’s brand valuation methodology auto dealerships, service providers, (e.g. fashion brands). RBI tends to fall and gas stations. within a category-driven range, but determines, in both customer and there remain significant opportunities for brands to increase their influence on financial terms, the contribution Financial analysis choice within those boundaries, or even extend the category range where the of the brand to business results. This measures the overall financial brand can change consumer behavior. return to an organization’s investors, or RBI determinations for this report derive, its “economic profit.” Economic profit depending on the brand, from one of A strategic tool for ongoing brand criteria for inclusion is the after-tax operating profit of the three methods: primary research, a management, it brings together market, brand, minus a charge for the capital review of historical roles of brand for brand, competitor, and financial data There are several criteria for inclusion in used to generate the brand’s revenues companies in that industry, or expert methodology into a single framework within which the Interbrand’s Best Retail Brands ranking. and margins. A brand can only exist panel assessment. RBI is multiplied performance of the brand can be assessed, and, therefore, create value, if it has a by the economic profit of the branded areas for improvement identified, and the Using our database of retail brands platform on which to do so. Depending retail sales to determine the earnings financial impact of investing in the brand (populated with critical information over on the brand, this platform may include, attributable to the brand (brand earnings) quantified. It also provides a common the past several years of valuing retail for example, manufacturing facilities, that contribute to the valuation total. language around which a company can brands specifically) and with 35 years of distribution channels, and working be galvanized and organized. consulting on retail brand experiences capital. Interbrand, therefore, allows through Interbrand’s retail arm, for a fair return on this capital before Brand Strength We believe that a strong brand, regardless Interbrand Design Forum, we formed determining that the brand itself is #BESTRETAILBRANDS of the market in which it operates, drives an initial consideration set of leading creating value for its owner. We build a Brand Strength measures the ability improved business performance. It does brands. All brands in the set were then set of financial forecasts over five years of the brand to create loyalty and, this through its ability to influence subjected to the following criteria that for the business, starting with revenues therefore, to keep generating demand customer choice and engender loyalty; narrowed the candidates: and ending with economic profit, which and profit into the future. Brand Strength to attract, retain, and motivate talent; then forms the foundation of the brand is scored on a 0–100 scale, based on an and to lower the cost of financing. Our 1. There must be substantial publicly valuation model. A terminal value is also evaluation across 10 key factors that approach explicitly takes these factors available financial data. If the company created, based on the brand’s expected Interbrand believes make a strong brand. into consideration. does not produce public data that financial performance beyond the explicit Performance on these factors is judged enables us to identify the financials of forecast period. The capital charge rate is relative to other brands in the industry There are three key components in all of the branded business, as is sometimes determined by reference to the industry and relative to other world-class brands. our valuations: analyses of the financial the case with privately held companies, weighted average cost of capital. The strength of the brand is inversely performance of the retailer, of the role the it cannot be considered for the list. related to the level of risk associated brand plays in the purchase decision, and with the brand’s financial forecasts. A of the competitive strength of the brand. 2. Economic profit must be positive, Role of Brand proprietary formula is used to connect the showing a return above the Brand Strength Score to a brand-specific operating costs, taxes, and capital Role of Brand measures the portion of the discount rate. In turn, that rate is used financing costs. decision to purchase that is attributable to discount brand earnings back to a to the brand, relative to other factors present value, reflecting the likelihood 3. To be defined as a retailer, a brand (for example, purchase drivers like price that the brand will be able to withstand must generate at least 50 percent of or location). The Role of Brand Index challenges and generate sustainable its revenues from sales through its (RBI) quantifies this as a percentage. returns into the future. branded retail stores and websites.

130 Best Retail Brands 2014 aburando t b strength INTERNAL FACTORS EXTERNAL FACTORS Clarity Authenticity Clarity internally about what the brand The brand is soundly based on an internal stands for and its values, positioning and truth and capability. It has a defined Our experience and knowledge proposition. Clarity, too, about target heritage and a well-grounded value audiences, customer insights and drivers. set. It can deliver against the (high) show that brands in the ideal position Because so much hinges on this, it is expectations that customers have of it. vital that these are articulated and shared to keep generating demand for the across the organization. Relevance The fit with customer/consumer needs, future are those performing strongly Commitment desires, and decision criteria across all (i.e. showing strength versus the Internal commitment to brand, and a relevant demographics and geographies. belief internally in the importance of competition) across a set of brand. The extent to which the brand Differentiation receives support in terms of time, The degree to which customers/

10 factors that are outlined below. influence and investment. consumers perceive the brand to have br About a differentiated positioning distinctive Four of these factors are more Protection from the competition. How secure the brand is across a internally driven and reflect the fact number of dimensions: legal protection, Consistency proprietary ingredients or design, scale The degree to which a brand is a or geographical spread. experienced without fail across all n

that great brands start from within. d strength touchpoints or formats. The remaining six factors are more Responsiveness The ability to respond to market changes, Presence visible externally, acknowledging the challenges and opportunities. The The degree to which a brand feels brand should have a sense of leadership omnipresent and is talked about #BESTRETAILBRANDS fact that great brands change the world. internally and a desire and ability to positively by consumers, customers and The higher the Brand Strength Score, constantly evolve and renew itself. opinion formers in both traditional and the stronger the brand’s advantage. social media. Understanding The brand is not only recognized by customers, but there is also an in-depth knowledge and understanding of its distinctive qualities and characteristics. (Where relevant, this will extend to consumer understanding of the company that owns the brand.)

132 Best Retail Brands 2014 Appendix

contributors SPECIAL THANKS

Eric Aielli Stephanie Fouchet Shayla Persaud Gonzalo Brujó Beth Ling Laura Andrade Kelly Gall Dominiek Post Chairman Director of Public Relations Jonathan Aplin Emma Gaskell Frederica Procope Interbrand Latin America & Iberia Interbrand Design Forum Robert Ausdenmoore Adriana Grillo Elizabeth Raffa Lexi Ball Sam Harthill Máximo Rainuzzo Alison Cardy Andre Matias Manuel Baptista Teri Henman Sarah Rascona Managing Director Brand Strategy Director & Fernando Barrenechea Calin Hertioga Sharmilee Rau HMKM Head of Brand Valuation Wil Bedale Gladys Ho Kristin Reagan Interbrand São Paulo Floortje Beemsterboer Cindy Hovell Rebecca Robins Lee Carpenter Lindsay Beltzer Emma Hrustic Angela Rodrigo Chief Executive Officer Sean Mead Michael Benson Guillaume Jonglez Melanie Roosen Interbrand North America Senior Director, Strategy & Analytics Suzana Blanc Alan Kambardiev Kris Rossi Interbrand Design Forum Julia Bland Terry Kerr Stefan Russli Bertrand Chovet Heather Boyd Cihan Kirimli Hardik Sanghvi Appendix Managing Director Colin Melia Shirley Brady Kai Klopsch Anastasia Scully Interbrand Paris Creative Director Arielle Breit Carrie Krochta Anna Shelyubskaya HMKM Arien Breunis Nicholas Lakas Kate Simmons Dirk Defenbaugh Charles-Henri Bresson Mariana Lancastre Christine Skovlund Managing Director Andy Payne Lesley Chapman Macaila Laubscher Scott Smith Interbrand Design Forum Global Creative Director Bill Chidley Yasmine Leguyader Patrick Stal Interbrand Rosie Chorley Katerina Letsos Jessica Steiner #BESTRETAILBRANDS Alfred DuPuy Alicia Ciccone Caroline Lewis Robin Stiskin Managing Director Paul Phillips Devon Clancy Tim Loftus Dominik Streich Interbrand Canada Digital Director Caitlin Collins Cathy Ma Rachel Tang Interbrand Europe Gareth Cooper Jungsan Ma Laura Tarbox Jez Frampton Graham Cox Christoph Marti Jotham Tonge Global Chief Executive Officer Mike Rocha Sue Daun Wayne Martin Bosco Torres Interbrand Global Director, Valuation María José Daura André Matías Johnny Trinh Interbrand Adam Davis Ivan Mato Joe Truett Stuart Green Jill Davis Jemima Maunder-Taylor Erica Velis Chief Executive Officer Scott Smith Steffen Dold Raphael Mayol Michael Waltzer Interbrand Asia-Pacific Chief Marketing Officer Margaret Donovan Vinay Mistry Brittany Waterson Interbrand Design Forum Andrey Dovzhik Kelly Morelock Patrick Weltert Graham Hales Stephanie Duncan Alexander Murray Emma Winter Global Chief Marketing Officer Andrea Sullivan Amy Edel-Vaughn Doug Nash Olivia Woodruff Interbrand Chief Marketing Officer Emma Ellis Tatiana Nezdemovskaya Nick Wright Interbrand North America John Fennessy Gabriela Oizerovici Cigdem Yildirim Rhonda Hiatt Marcelo Ferrarini Cristiana Pearson Executive Director, Strategy & Analytics Interbrand Design Forum

134 Best Retail Brands 2014 CONTact us

Global Asia-Pacific

Jez Frampton Stuart Green Global Chief Executive Officer, Interbrand Chief Executive Officer, Tel U.K.: +44 (0) 20 7554 1183 Interbrand Asia-Pacific Tel U.S.: +1 212 798 7777 Tel Singapore: +65 6534 0567 [email protected] [email protected]

Graham Hales Latin America Global Chief Marketing Officer, Interbrand Tel U.K.: +44 (0) 20 7554 1169 Gonzalo Brujó [email protected] Chairman, Interbrand Latin America & Iberia North America Tel Spain: +34 91 789 30 01 [email protected] Lee Carpenter Chief Executive Officer, HMKM Interbrand North America Tel U.S.: +1 937 312 8812 Alison Cardy [email protected] Managing Director, HMKM Tel U.K.: +44 (0) 20 7494 4949 North America [email protected] (Interbrand Design Forum) PRESS INQUIRIES & REPRINT REQUESTS Scott Smith

#BESTRETAILBRANDS Chief Marketing Officer Lindsay Beltzer Tel U.S.: +1 937 312 8904 Senior Associate, Global Marketing & [email protected] Communications, Interbrand Tel U.S.: +1 212 798 7786 Europe [email protected]

Simon Bailey ADDITIONAL INFORMATION Chief Executive Officer, Interbrand Europe interbrand.com Tel U.K.: +44 (0) 20 7554 1125 bestretailbrands.com [email protected] interbranddesignforum.com hmkm.com

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Founded in 1974, Interbrand is the world’s Interbrand is widely recognized for its annual leading brand consultancy. With nearly Best Global Brands report, the definitive 40 offices in 27 countries, Interbrand’s guide to the world’s most valuable brands, combination of rigorous strategy, analytics, as well as its Best Global Green Brands report, and world-class design enables it to assist which identifies the gap between customer clients in creating and managing brand value perception and a brand’s performance relative effectively—across all touchpoints, in all to sustainability. It is also known for having market dynamics. created brandchannel.com, the award-winning resource for brand marketing.

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