Retail News Breaks Archives
CVS, Walgreens rank high in retail brand value
March 30th, 2011
NEW YORK – CVS/pharmacy and Walgreens finished in the top 10 in Interbrand Design Forum's annual ranking of the top 50 most valuable U.S. retail brands.
Also, the brand consultancy on Wednesday said that Shoppers Drug Mart was ranked as the most valuable retail brand in Canada.
In Interbrand's third annual ranking of the top U.S. retail brands, CVS came in at No. 5 and Walgreens was No. 6 — a reverse of their positions last year, when Walgreens finished fifth and CVS was sixth.
Just as in 2010, the most valuable retail brand was Walmart, according to Interbrand.
Walgreens and CVS were the only drug store chains on the list. Others in the top 10 of the 2011 Best Retail Brands list for the U.S. were Target (No. 2, same as in 2010), Home Depot (No. 3, up from No. 4 last year), Best Buy (No. 4, down from No. 3), Sam's Club (No. 7, same as in 2010), Coach (No. 8, up from No. 9 last year), Amazon.com (No. 9, up from No. 10 in 2010 and Dell (No. 10, down from No. 8 last year).
Food, drug and mass-market retailers also making the U.S. top 50 included Publix (No. 14), Dollar General (No. 16), Costco (No. 19), Dollar Tree (No. 43), Whole Foods Markets (No. 44), Big Lots (No. 45) and Family Dollar (No. 46).
Interbrand ranked the value retail brands on the basis of how much they stand to earn for their companies in the future. It assessed brands in such areas as financial strength, market leadership, influence in consumer selection and the likelihood of generating ongoing revenue.
The consulting firm pointed to CVS' focus on affordable health care as a catalyst in driving significant gains in pharmacy and retail sales at the company. Interbrand also said more people are visiting the in-store MinuteClinic health centers, which is boosting front-end business. Accessibility also has been enhanced by CVS' mobile application, which enables on-the-go customers to manage prescriptions as well as remotely access health information, a flu shot scheduler and the retailer's sales circular.
Meanwhile, Interbrand said Walgreens has held its own amid intense competition for prescription dollars from other brick-and-mortar retailers — including Walmart — as well as online pharmacies. The brand consultancy also cited Walgreens strategy to position itself as a "health and daily living store," which should mitigate pressure on the pharmacy business.
"The company recently pulled off something of a retail coup when it acquired Duane Reade, the New York City drug store chain, making Walgreens the dominant player
in that market," Interbrand added.
In Canada, Shoppers Drug Mart "is much more than the top-of-mind pharmacy," according to Interbrand.
"New generic drug regulations, the abrupt departure of its CEO, reduced capital expenditures, and increased competition from more retailers such as Loblaw and Walmart means that Shoppers will need to stay nimble with its strategy in the year ahead," the consultancy explained.
Interbrand noted that Shoppers Drug Mart's ability to deliver choice, convenience and a wide range of trusted brands and private-label and beauty products also has made it a model for U.S. drug store retailers. What's more, over 9.5 million Canadians actively use its Optimum loyalty card, while new and larger store formats, an expansion into food and electronics, and the recent Men's Zone concept have enhanced the customer experience, the consultancy said. The chain, too, is effectively using mobile marketing and social
media to improve the customer experience through help and dialogue.
"Consumer confidence has been returning, yet people have been fundamentally changed by the recession, with markets opening up and rapid advances in technology that influence how and where people shop. For retailers, this means having to create new, exciting opportunities to truly connect with more skeptical and e-savvier customers," Jez Frampton, global chief executive of Interbrand, said in a statement.
Brand-led retail companies are proving to be resilient in a business climate characterized by rapid change, according to Interbrand.
"For two years, store expansion has slowed while retailers focused on what mattered most to their customers," stated Bruce Dybvad, chief executive of Interbrand Design Forum. "In the past year, the best-performing brands demonstrated their ability to understand customers and have found innovative ways to strengthen the relationship with their core customers."