According to Interbrand’s “Best Global Brands 2020: Provide in the Decade of Possibility,” strong brands became stronger as a result of COVID-19, with the top three brands alone—Apple, Amazon and Microsoft—seeing an average increase in value of 50 percent. The aggregate value of the 100 best global brands grew by nine percent as their total brand value exceeded $2 trillion.
Interbrand’s latest research provides an in-depth look at how retail brands in particular have adapted and thrived in 2020. Top players in Interbrand’s retail ranking include: Coca-Cola, Nike, Ikea, Pepsi, Zara, Starbucks, eBay, Adidas, Johnnie Walker and Lego, to name a few.
While the pandemic accelerated digital adoption and consumer shifts to online commerce channels, it’s clear this shift was well underway before. In 2019, 9,500 retail stores closed in the US, up 64 percent from the 5,844 closures in 2018, according to Coresight Research. Estimates for 2020 show up to 25,000 businesses shuttering.
The report notes that in the past two decades, ecommerce has risen to 16.1 percent of total retail sales in the US, according to the latest data from the US Department of Commerce. As COVID-19 created a new precedent for online shopping, in just the past year ecommerce sales grew 44.5 percent—outperforming the typical growth rate of 15-17 percent seen in previous years.
Amazon, which Interbrand includes in the technology category, accounts for 38 percent of the US ecommerce market. The keys to its success include its 150 million Prime subscribers, its use of more than 200,000 robots and relentless hiring, with a 50 percent growth rate in employees year-over-year. What’s more, Amazon’s artificial intelligence-driven product recommendation engine is reported to generate as much as 35 percent of the company’s revenue.
“We’re grateful for the trust customers put in us, but we often say: “it’s always Day One.” And the reason we do that is that we recognize that customers can get dissatisfied quickly – yesterday’s invention becomes today’s new normal . . .,” said Neil Lindsay, vice president of Prime and marketing for Amazon Consumer Business.
With 50 years of supply chain dominance and over 11,000 stores in 27 countries, Walmart, too, has proved to be a major force in retail. Though Interbrand’s research estimates Amazon will eclipse Walmart’s revenue by 2024.
To address the thinking that browsing in person is a thing of the past, Walmart is redesigning its store to include more open space, larger signage and contactless payments. Where Walmart has the most work to do, the report notes, is getting consumers to perceive it as an internet retailer too. Interbrand’s research shows that Walmart hasn’t successfully translated its offline grocery credibility into the online space.
“As companies like Walmart, Google and Amazon increasingly start to play in different sandboxes, the important point will be how they bring a version of themselves into that environment in a way that remains authentic to them, but which meets and ideally surpasses the right consumer drivers for that space,” said Christina Stahlkopf, associate director of research and analytics at C Space.
A major pandemic takeaway for Starbucks is that it needs to optimize its in-store experiences by merging various store formats, including pickup, curbside and drive through, with its traditional brick-and-mortar stores. It’s already in a good position to do so, as the report notes that before the crisis, around 80 percent of the company’s transactions in US stores were on-the-go purchases.
At Diageo-owned Johnnie Walker, the goal was to support the wider industry, a purpose that inspired its creation of Raising the Bar, a global program that provides targeted support to help pay for the equipment needed for pubs and bars to reopen. To reach consumers stuck at home, the brand also launched new initiatives like Johnnie Walker ‘Kitchen Sink Drinks,’ inviting fans to submit ingredients they had at home to its bartenders. Sustainability has also been top-of-mind for the brand. In 2020, all the plastic in its giftpacks were made from 100 percent recycled plastic.
According to Christian Purser, chief executive officer of Interbrand London, the new retail landscape will require brands to create ultra-connected, local experiences, provide seamless omnichannel experiences and live up to their ethics and values.
For Interbrand’s full list of best global brands across all categories, click here.