This article by Michelle Whelan, co-CEO VMLY&R UK and CEO VMLY&R Commerce UK, was originally published by Modern Retail.
A new report by WPP’s BAV (with retail analysis from VMLY&R Commerce) reveals “The World’s Most Influential Retail Brands”. The Top Ten looks like this:
7. The Home Depot
9. Mercado Libre
Quite a varied list, and few surprises.
The question I’m often asked by brands and retailers alike – is whether the role of influencing people’s behaviour is really that important? Is it hard or soft power? Does it drive growth?
David Roth, Chairman of WPP’s BAV explains. “The top 5% most influential brands benefit by being chosen regularly 2.4 times more often than rival brands, winning double the level of advocacy, having 1.5 times the pricing power… Their ‘influence’ shows up too in stock market performance, with a broader portfolio of Most Influential Brands overall (retail and non-retail) outperforming the NASDAQ by 48%.”
The role of influence should not be underestimated. It really does positively impact the bottom line.
To understand further, I had a closer look at the EMEA region, the drivers of influence, and tips for success. EMEA’s top influential retail brands, in alphabetical order, stack up as follows:
Bang & Olufsen
Dm drogerie mart
Many stand out because they blend great traditional retailing with technology, putting customers first and creating great experiences that keep people coming back.
They smartly pivot in response to shifting behaviour change – adapting with convenience and speed to secure opportunities in new places and spaces, maintaining the crucial connection with customers.
Most interesting of all, these retailers are also successfully delivering against some, if not all, of the drivers of influence defined by the BAV Report: innovation, trust, performance, status, purpose, authenticity, convenience, contemporary and fun.
I unpicked these drivers to see just how some of these brands are delivering greater degrees of influence. This is what I uncovered…
Trust is particularly important now, given the pressures most people are facing on household budgets. Among the most influential retail brands in EMEA, thirteen have trust as either a primary or secondary Influence element.
Take supermarkets with a long heritage in home markets such as Woolworths/ South Africa, Albert Heijn/ The Netherlands, and Mercadona/Spain. These have all pivoted swiftly to remain relevant to today’s shoppers through Trust – having earned a place in people’s lives over generations.
Top retailer Norwegian digital marketplace, FINN, is a store for just about everything, an Amazon-style marketplace, and the modern-day equivalent of a newspaper classified ads section with listings for real estate job vacancies. A close-up, personal relationship with Norwegians, built over generations, allows the retailer to continuously innovate and tap into new categories. It’s now a top destination for holidays and a substantial second-hand marketplace. A terrific example of trust driving influence.
Danish luxury audio brand Bang & Olufsen, launched in 1925, continues to allure and appeal – testament to an inventive approach to design and technology. Add to that, innovation in how it reaches and influences customers with sublime experiences.
Just this March, B&O collaborated with Michelin-starred chef Tom Sellers to create an exclusive pop-up picture-house experience at Smallbone’s Knightsbridge Luxury Pavilion.
Giving visitors a chance to see and hear the latest blockbuster films with a fine dining twist.
B&O is tapping into influence drivers Performance and Innovation to stand out in a sector where brands heavily compete on price. Genius.
Sustainability and personalisation both feature heavily in how brands influence in an era of changing consumer demands and the need to offer something special that commands a premium at a time when it’s tempting to simply lower prices to maintain share.
One of the world’s most successful retailers, IKEA, has been deeply influential from Day One by transforming homeware shopping into a unique and often pleasantly exhausting experience across flat-pack furniture, Swedish chocolate, meatballs and more. All with one focus – customer at the core.
The brand moves smartly with great shopper behaviour insight.
Take Sustainability. A huge consumer of raw wood and cardboard, IKEA had the potential to fall out of favour among a growing environmentally aware generation. Yet its mission to “inspire and enable more than 1 billion people to live a better everyday life within the boundaries of the planet” has come to mean more than sturdy bookshelves – making the brand more relevant than ever.
As part of an environmentally-led campaign, IKEA is introducing smaller stores to reach urban shoppers – also part of a bid to compete against e-commerce sites. It’s experimenting with different ways of inviting customers to experience products, both in real-life via pop-up cooking classes and via virtual reality apps in-store. Just recently, it launched an in-store AR game with Meta teaching customers about marine life and sustainability. “We are constantly exploring new ways to meet our customers,” said Helena Gouiveia, marketing manager at IKEA Retail Sweden.
In BAV’s research, IKEA stands out for being Contemporary and Fun. After 80 years in retailing, a contemporary tag is no mean feat!
Fast fashion brand Zara, founded in 1975 to become a global powerhouse, is another business that has led right from the outset – its obsession with customers is driving the retailer to pivot its approach to fast fashion.
If we think back, Zara brilliantly pioneered the introduction of new collections in just four weeks, compared to an industry average of four to six months. It changed generations of shoppers’ expectations of what fashion could be, with affordable prices and young buyers frequently returning to purchase.
Yet, as fast fashion falls out of favour, Zara is smartly adapting with a huge recycling and upcycling sustainability programme. Last year it entered the resale market with a pre-owned service – where shoppers can book repairs and donate unwanted items.
Finally, world-famous Adidas stands out for its relentless focus on personalisation. Today, it’s developing digital experiences and creating relationships with customers beyond just making a sale.
It understands that some customers want to be served online or buy through TikTok or live streams, while others prefer to buy in-store. “It is about shifting from customer experience to total experience. That is the main trend that we are seeing, and personalisation helps dramatically.” says adidas.
Back to the question I’m often asked about the role brands play in influencing people, communities and the planet. My answer is simple: it’s imperative. Brands must stay connected to people and culture. And relentlessly demonstrate they’re evolving to meet the needs of their customers today and importantly their customers of the future.
One final thought. Influence is a serious business. Just ask Rihanna, whose Fenty Beauty Empire was recently valued at $ 2.8 billion.