By Claire Reilly
International brand management agency Interbrand has announced its list of the top ten retail brands in Australia, with supermarket giant Woolworths topping the list for the second year in a row, followed by Coles, Bunnings and Harvey Norman, which has fallen considerably since last year.
Interbrand ranked the retailers based on financial performance, the strength of the brand and the role of the retailer’s brand in “the purchase decision process", which is then measured as a percentage in the 'Role of Brand Index'. This Index is then multiplied by the retailer’s “economic profit” to determine the monetary value of the brand.
Woolworths saw a 9 per cent increase in its brand value in 2013, which is up to $4.57 billion, while Harvey Norman (down from 3rd place across Asia Pacific in 2012, to fourth in Australia alone this year) saw a 27 per cent decline in brand value, now measured as $642 million.
In its analysis of Harveys, Interbrand said “a tough retail climate with poor consumer sentiment, increased online competition and price deflation in core AV and IT product categories have led to an overdependence on its franchisee model and property portfolio to generate revenue in the face of declining sales.
“That said, Harvey Norman is starting to embrace an experiential multichannel retail model under CEO Katie Paige, leveraging the brand’s local presence and sales expertise to build points of difference in the market,” the Interbrand report read.
“Promising signs, but the brand has a lot further to go to restore relevance with consumers in 2013 and beyond.
The other dedicated electrical retailer to make the list was JB Hi-Fi, with a brand value of $334 million.
“JB Hi-Fi has profited from the demise and consolidation of the traditional music category,” the report found. “But its magic growth formula will be severely tested. The brand aggressively expands by replicating the low cost retail model online, creating the JB Hi-Fi Now subscription music service, diversifying into household appliances and transitioning many stores into a concession model with an upmarket feel.
“But this shouldn’t dilute the brand’s strong single-minded proposition. The challenge is to use the brand to replicate an equally compelling experience across channels and categories.”
The full list of Best Retail Brands 2013 is listed below (percentage refers to increase or decrease in the retailer’s Role of Brand Index, unless the retailer is a new addition to the list; dollar value indicates value of brand).
1. Woolworths: +9%, $4.57b
2. Coles: New, $3.645b
3. Bunnings: New, $1.107b
4. Harvey Norman: –27%, $642m
5. Myer: +4%, $625m
6. Big W: New, $562m
7. Target: New, $536m
8. Kmart: New, $516m
9. David Jones: –9%, $512m
10. JB Hi-Fi: New, $334m
See the global brand rankings on Interbrand’s website.