Brand values up by more than a third as e-commerce thrives
For the first time the Brand Finance Retail ranking has been expanded to include 100 brands to give a fuller picture of the diverse sector. Unsurprisingly, various types of retailers have been impacted by the pandemic differently, with e-commerce brands faring the best, recording an average brand value growth of 38% and department stores suffering the worst, losing 11% of brand value on average.
Amazon has retained the title of the world’s most valuable retail brand, recording a 15% brand value growth to US$254.2 billion. The giant is one of the few brands that has benefitted considerably from the pandemic and the resulting unprecedented surge in demand as consumers turned online following store closures. Over Q2 and Q3 of 2020, e-commerce platforms experienced the highest revenue growth since 2016.
Most recently – further leveraging the circumstances of the pandemic – Amazon has acquired 11 passenger planes from struggling North American airlines to expand its air logistics capabilities. A tactical purchase to support its fast-growing customer base, but also a strategic move towards building its own end-to-end supply chain, the fleet can allow the brand to become a serious contender in air transportation in due time.
The recent announcement that founder and CEO Jeff Bezos is stepping down from the helm, could mark a new positive direction for the brand that has found itself at the centre of controversies, from negative coverage of his divorce, allegations regarding poor treatment of workers, and criticism for Bezos’s apparent reluctance to use wealth for philanthropic goals.
Apart from calculating brand value, Brand Finance also determines the relative strength of brands through a balanced scorecard of metrics evaluating marketing investment, stakeholder equity, and business performance. Certified by ISO 20671, Brand Finance’s assessment of stakeholder equity incorporates original market research data from over 50,000 respondents in nearly 30 countries and across more than 20 sectors.
According to these criteria, Amazon has also retained the title of the world’s strongest retail brand with a Brand Strength Index (BSI) score of 89.9 out of 100 and a corresponding elite AAA+ brand strength rating. Despite controversies, Amazon is loved by consumers. The
brand has completely transformed the way in which purchases are made, and with a world-class reputation for speed, reliability and convenience, consumers continue to return to the site for all their shopping needs.
Richard Haigh, Managing Director, Brand Finance, commented: “Playing a crucial role in supporting a new economic mode in lockdown, Amazon has found itself at the centre of attention more than ever before. Many consumers find themselves converts to a reliance on the polished purchase experience Amazon provides, but the brand is not without critics. From questions about the treatment of workers, to pushback against a global corporation in support of local retailers, the company will have to deal with these challenges over the coming years. With Bezos recently announcing he is stepping aside, only time will tell the direction the brand will take under new leadership and if this will signal a marked change in operations.”
Key points again:
- E-commerce brands thrive amid pandemic, recording average brand value growth of 38%
- Amazon continues to dominate sector as world’s most valuable and strongest retail brand, brand value US$254.2 billion
- Chinese brands see strong growth – Alibaba.com is fastest growing brand in Brand Finance Retail 100 2021 ranking, up impressive 108%
- Mixed fortunes for traditional brick and mortar brands, those that embrace tech are thriving, including Walmart, up 20%
- Supermarkets record average brand value growth of 6%, as business models are tested during turmoil of 2020
- Notable new entrants: MercadoLibre, Biedronka and Kesko