Walmart maintains lead in global retail brand evaluation
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US group Walmart — which has international holdings that include SA’s Massmart — once again dominates the latest Interbrand valuation of global retail groups, published yesterday. Despite a 6% drop from last year, Walmart’s $131.9bn brand valuation is more than four times that of its closest competitor. The company is the only one of the top 10 to lose value since last year. The biggest improvements were enjoyed by online retail brands Amazon.com and eBay, up 27% and 20% respectively. Their success is likely to rub off on traditional retailers. Interbrand global CEO Jez Frampton said yesterday: “In today’s rapidly evolving global marketplace, retail brands must be more agile, flexible and responsive than ever. “Winning retail brands will not only survive the continuous shift to digital retail, they will become more extraordinary because of it.” The 2014 Annual Best Retail Brands Report said Amazon.com’s growing success was not only because of low prices caused by low overheads, but “also due to its ability to make millions of price changes per day compared to traditional retailers’ thousands a month”. It adds: “These price changes have begun escalating at brick-andmortar stores as retailers fight for consumer dollars.” The Interbrand ranking measures brands on a combination of three criteria: the financial performance of the branded products or services; the role of brand in the purchase decision process; and brand strength. To be considered retailers, brands must earn at least 50% of revenue from sales in branded stores and websites. Apple was among brands that fell at this hurdle. Predictably, most of the global top 10 retailers are American. The only exceptions are Swedish chains — clothing retailer H&M and furniture-home specialist Ikea — which are newcomers to the top 10. The table is drawn from the top 50 brands in North America, 50 in Europe, 30 in Asia-Pacific and 20 in Latin America. The leaders, respectively, in those markets, are Walmart, H&M, Woolworths ($4.9bn) and Natura ($3.2bn). African retailers are nowhere near these levels. Johannesburg-based Interbrand Sampson De Villiers group CEO Doug de Villiers said the last time Interbrand produced an African-specific brand rating was 10 years ago. It might publish another later this year. South African telecommunications company MTN has made it into the top international 100 of overall brand rankings.
This article was first published in Business Day on 8 April 2014