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Ten Retail Brands to Watch in 2019

BY CSA Staff

Brand-building consultant and author Denise Lee Yohn has released her annual Brands to Watch list — the brands that she will be keeping her eye on in the coming year. There are 26 companies on the list (one for each letter of the alphabet), with retail and restaurant brands accounting for 10 of the spots. Here is Yohn’s take on the top 10 brands:

• Amazon: No surprise, Amazon will dominate the headlines. Increased competition for its voice-activated services and devices and its unfolding retail strategy (Go, 4-Star Stores and Whole Foods Market) will be newsworthy items. Plus, we’ll likely see the company make some bold moves in light of slowing Prime membership growth. And although the decision about the location of its new headquarters has been made (NYC and D.C.), the fallout–including reduction in its business with FedEx, NIMBY resistance from the selected local communities and increasing criticisms about tax breaks it receives–will continue.

• Canada Goose: Canada Goose is to consumers today what Range Rover was in the 1990s–a luxury brand with product performance cred. Canada Goose puffer jacket wearers probably never have to endure extended time in sub-zero temperatures, but they could–and that’s the brand’s appeal. It’s become the ultimate status symbol, sported by celebrities and fashionistas. The company’s recent expansion into sweaters and acquisition of Baffin boots shows it is preparing to become more of a lifestyle brand and build the product line diversity it will most likely eventually need.

• Hema: Hema, the grocery store concept from Alibaba that combines fresh food and digital technology into a breakthrough customer experience, is only one of the many reasons to keep your eye on the Chinese e-commerce giant. Another is the record $30.7 billion in sales it took in during Singles’ Day, its annual 24-hour online shopping holiday, which made the $1 billion Amazon generated on Prime Day seem paltry. The stepping down of founder, executive chairman, and public face of the company, Jack Ma, next year is yet another. Overall the company is boldly pursuing its “new retailing strategy,” which emphasizes the “harmonious integration” of on- and offline commerce.

• J. Crew: This letter is actually less about J.Crew per se and more about its partnership with Amazon Fashion (although change is brewing at J.Crew, given its latest CEO resigned after only 17 months). Amazon is giving brands like J.Crew their own dedicated storefronts, with a look distinct from Amazon. For the brands, the offering is a way to become more accessible and convenient to a larger audience than they could attract on their own. For Amazon, it’s attracting brands that had previously resisted selling through Amazon – and positioning Amazon as the top player of the U.S. apparel industry.

• Lowe’s: With Lowe’s Home Improvement recent decision to close nearly 50 stores, you might think the brand should be headlining a list of Brands Most Likely to Fail in 2019. But I actually think the brand could undergo a successful turnaround. At the company’s helm is Marvin Ellison who successfully executed a similar scale-back at Home Depot a decade ago – and a new CIO who previously headed up Target’s digital and marketing technology. And the company’s working on improving customer experience through advanced technology and rationalizing inventory – so there’s reason to be cautiously optimistic.

• Rent the Runway: Rent the Runway, the 10-million member wardrobe-for-rent retailer, is transforming fashion retail. In addition to the high-end selections the brand started with, it has become more accessible and convenient, now offering a subscription service that allows customers to rent four items for 30 days at $89/month and the option to pick up orders at select WeWork locations. Now, Rent the Runway has developed a program that allows other brands use its platform to rent out their inventory – Club Monaco and Levi’s are just a few that have already signed on. That means we’ll be seeing more of this and other sharing economy retailers in 2019.

• Starbucks and Schultz: This letter is a two-fer, highlighting two related brands. First, Starbucks. The company ended 2018 with a great Q4 (strong comparable store sales momentum, new store openings and growth in its loyalty program) and recently entered into a partnership with Alibaba in China that is expected to accelerate growth in that already high-growth potential market. But it also recently announced it was eliminating 350 positions from its Seattle headquarters.

Second, former Starbucks CEO Howard Schultz seems to be gearing up for a bid for the U.S. presidency. He has a personal website and a new book, From the Ground Up: A Journey to Reimagine the Promise of America, slated for release in February. Hmmm…

• Victoria’s Secret: My questions above about #MeToo notwithstanding, it’s clear the movement has impacted business as we know it. Victoria’s Secret is just one brand that has suffered from the new spirit among women who rail against notions like buying and wearing sexy lingerie just to impress men. The company’s sales, market share, and stock price have taken a nose dive and the brand no longer enjoys the cachet of a cultural icon. Will new leadership be able to turn it around? And what about the rest of the L Brands portfolio, which includes Bath & Body Works?

• Walmart: Walmart is once again my choice for “W” because it continues to fight aggressively against Amazon and other competitors. It has been working on reinventing itself through acquisitions that shore up its specialty business expertise, including lingerie brand Bare Necessities and women’s plus-sized ELOQUII, and the strengthening of its digital capabilities, as demonstrated by its 43% jump in Q3 e-commerce sales. But the company still has organizational and cultural issues to overcome and Amazon continues to dominate the digital world while expanding its brick-and-mortar offerings.

• Yum! Brands: Yum! As the parent company of fast food chains KFC, Pizza Hut and Taco Bell, Yum! serves as a bellwether for brands in the more price-driven segment of QSR. For years, the segment has been losing share to fast casual restaurants – but now with the crowding of the fast casual space and the improving quality and innovation in fast food, the tide may be turning and fast food brands may be making a comeback. Yum! specifically has engaged a three-year transformation plan that seems promising.

To see the full list of the top brands of 2018, click here.

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Study: Brand values second only to price in holiday purchasing decisions

BY Marianne Wilson

Americans are leaning towards socially conscious companies this holiday season.

That’s according to a new survey by SAP SE, which found that 54% of American consumers consider themselves to be socially conscious shoppers, and 63% of respondents prefer to purchase holiday gifts from brands that support specific social causes.

The study also revealed that brand values are second only to price when making purchasing decisions. The values of a matter more than a previous positive or negative experience with a brand, how user friendly a website is and if the brand has a physical store nearby, according to the survey.

Additional insights from the SAP survey include:
•Sixty-percent of individuals will avoid buying from brands that support causes they disagree with during holiday shopping.

•Consumers are willing to pay more for values. More than half of respondents said they would spend more for a holiday purchase from a brand that strongly supports a cause or represents specific values.

•Brand values are second only to price when making purchasing decisions. Brand values matter more than a previous positive or negative experience with a brand, how user friendly a website is and if the brand has a physical store nearby.

•Brands must be transparent in business practices. Sixty-seven percent of consumers said transparency in business practices is essential for brands to prove authenticity.

•Shoppers want their values to align with brands. The values most important to shoppers this holiday season are environmental sustainability, education and diversity and inclusion.

“We live in an experience economy in which consumers care not just about products but also about a company’s purpose, value and global impact”, said Alex Atzberger, president of SAP’s customer experience organization. “For retailers this can be decisive while competing during the holiday season, when shoppers are spending more than any other time of the year. Our survey findings indicate that when a company closely connects its purpose to the brand, chances are customers will relate to it on a more personal, human level — which supports customer loyalty and completes the customer experience.”

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Walmart rolls out in-store ordering app for employees

BY Deena M. Amato-McCoy

Walmart associates can now place online orders for in-store customers — directly from store aisles.

Walmart on Tuesday introduced a new employee-based app designed to save the sale. Internally known as “Dotcom Store,” the app enables customers to work with associates to order items that may not be available on store shelves, as well as pay for merchandise.

Here’s how it works: Using the app, which is downloaded on a mobile device, associates can look up out-of-stock merchandise. (The app is directly integrated to Walmart’s e-commerce site.) Customers can choose to have the item shipped to their home or delivered to the store for free, and the associate will print a receipt or send an email that must be presented at any register in the store, according to a blog on Walmart’s website.

Customers pay for orders using cash, check (a new option), credit card or Walmart Pay, a mobile wallet that stores customers’ preferred gift, debit and credit cards, and enables them to pay through their device.

“This new app connects our stores and Walmart.com to enable a new, convenient service, and it’s also the latest in a series of apps associates now have to help them serve customers even better,” the blog reported.

Walmart’s other custom-built employee apps include PlanIT, which keeps associates up-to-date on company and store announcements; the Receiving App that reveals which products have just arrived at the store, and the Downstock App that keeps associates abreast of merchandise available on store shelves, according to separate blog on Walmart’s website.

Walmart’s Price Change app delivers information about necessary product price updates. It also categorizes them by aisle so associates receive them in the order they should be made, creating an efficient path through the store.

An Availability app gives associates insight into how their store is performing over time, including when out-of-stocks occur. Meanwhile, the Sales app updates a store’s sales numbers in real time so that associates know how their designated areas are performing against the previous year, down to specific products.

“[The] suite of custom-built apps for associates … allows them to manage a variety of routine activities directly from a mobile store device. From the moment a product arrives in the back room to the second a customer finds it on the shelf, an ecosystem of data gives associates new visibility that helps them make informed decisions quickly, thus allowing them to take on more ownership of their work,” according to Walmart.

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