Tony D'Onofrio
Blog
With a Mix of Brand Challenges in the Retail Industry
Earlier this year, Brand Finance published its latest ranking of the world's most valuable brands. Displacing last year's number 1 Amazon, Apple has roared back to the top spot with an astonishing 74% brand value increase. The company's 2024 brand value growth is approximately equal to the total value of Starbucks’s, Mercedes-Benz’s, Tesla’s, and Porsche’s brands combined.
"Apple has grown its brand value through strategic diversification and premiumization, moving away from heavy reliance on iPhone sales towards ventures into wearables and services such as Apple TV subscriptions." According to Brand Finance research, more that 50% of respondents recognized Apple as expensive, but worth the price, reinforcing the brand's ability to demand a price premium.
This article looks deeper into the success at Apple and explores the overall most valuable / strongest global brands. Finally, it summarizes the retail and apparel companies that emerged as the global brand value leaders in 2024.
The Next Apple Big Thing
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Once again, the ritual that is the January National Retail Federation Big Show is upon us. Over 40,000 people, 6200+ brands, 1000+ exhibitors, from 100+ countries participated in the NRF 2024 edition. My retail innovation leadership activities stretched out over five days logging over 75,000 steps or to be more exact 32.62 walking miles.
The greatest pleasure at this event is reconnecting with retail and technology leaders from around the world in one single location. This year was a reminder that we are well past the pandemic. Refreshingly, the hearty handshakes and hugs were back with both friends and business colleagues.
Personally, NRF 2024 was even more special as I returned as President of Sensormatic, the leading retail portfolio business of Johnson Controls. My agenda was super packed with retailers, press, and analyst’s meetings. Being a true retail technology industry ‘geek’, I did squeeze in my traditional trend spotting walk.
This article summarizes some of my favorite events and themes of NRF 2024. It highlights both the ‘hits’ that made NRF 2024 memorable and the one ‘miss’ that could have improved it.
Best Way to Start Each NRF: Retail ROI Super Saturday
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For multiple reasons, 2024 has copiously been on my mind. Maybe it is the magic of the holidays or thinking about the meaning of the New Year. Possibly for me personally, it is the number 24 as I was born on the 24th day of the month.
Each new year is typically a moment of reflection for all of us. We think back on the previous year and a substantial number of us engage in the ritual of setting 'New Year Resolutions'.
From the results of a new YouGov survey, just over one-third of USA adults plan to make New Year's resolutions or set specific identifiable goals for 2024. Adults under 20 (52%) are most like to do so, followed by 30-to-44-year-olds (44%). Older individuals are either wiser or simply seem to ignore this goal setting ritual. Only 27% of 45-to-64-year-olds and 18% of people 65 and older will set New Year's Resolutions.
For 2024, the top 5 New Year Resolutions for Americans are:
Saving Money 23% Be Happy 22% Exercise More 21% Improve Physical Health 21% Eat Healthier 20%The idea of preparing for a new year is a human condition with a long historical tradition. The month of January
which kicks off the New Year gets its name from the Roman god Janus. For the Romans, Janus was the god of beginnings and transitions. He presided over passages, doors, gates, and endings as well as between war and peace. He was usually depicted as having two older men faces looking in opposite directions, one towards the past and one towards the future.
This reflective celebratory article analyzes the number 24 and provides some insights from the Chinese Zodiac Calendar of what is ahead in 2024.
Fun Facts About the Number 24
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Are we becoming more physical stores or online digital shopper consumers? Prior to the pandemic, a topic that was popular in general media was the “retail apocalypse”. This Armageddon industry ending realization was being driven by rising retail bankruptcies and store closures.
The opposite force was the rise of digital commerce. Back in the year 2000, less than 1% of USA retail sales came from ecommerce. Fast forward to 2018 and it reached nearly 10% and by 2027 it is projected to reach 20.4% of total retail sales.
The digital revolution of the retail industry is here to stay. For the first half of 2023, according to Morning Consult, these are the reasons for shopping online versus instore.
Above chart is important as it points to the drivers of the digital versus physical instore model. This is a general view across the shopping population. As I pointed out in a previous article, leading retailers have realized the digital and physical are blending into phygital strategies. It’s no longer one versus the other, but the growing intentional strategy to combine the business models to drive higher consumer engagement across channels.
Just as interesting, if not more important, are technology adoption trends for the younger consumers and the innovation they would to see introduced into shopping journeys. As a new research study from Tata Consultancy Services pointed out, “consumers of all ages want new technologies, based on their preferences, to enhance their shopping experiences, instore and online, today and in the future.”
Privacy is Less of Concern for Younger Generations
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The last ten years of my life have been transformational. Curiosity and continuous improvement have been the cornerstone of the evolution of my personal brand.
The support and inspiration by many of you, plus the many questions on the formula of my personal brand, led to the writing of my first book titled: Unleash Your Brand: Discovering the Key to Monetizing Your Own Personal Brand.
This book is my gift to everyone around the world that has supported and encouraged my branding journey. In the over 200 pages, I share insights on how my personal brand started, how I monetized it, the impact of Artificial Intelligence, and the exact details of the formula that made it successful.
The quotes from Jeff Bezos, Walt Disney, Vince Lombardi, Mark Twain, PT Barnum, and Ralph Waldo Emerson in this article are followed by my own words as written in the book. Scan the QR code if you would like to receive notification and a discount on the book's release.
There is no better time than today to start your own personal branding journey to elevate the value of your corporate career and set you up to many more future options to monetize your individual value. According to Goldman Sachs, the creator economy will approach nearly a half-trillion dollars by 2027, up from $250 million today. Your share awaits and the faster you start, the more valuable your brand will become.
"Your Brand is What People Say About You When You are Not in the Room" - Jeff Bezos
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Over the past two weeks, I had the pleasure of visiting several futurist retail stores in Europe. What became clear from those visits is that the linkage between physical stores and online ecommerce is growing stronger and much more innovative. Progressive retailers are moving on from omnichannel to phygital.
Differentiating these two concepts from a customer point-of-view:
The omnichannel consumer is one who shops using both online and offline channels. Phygital is the deliberate focused operational strategy to combine digital and physical experiences across channels.As visualized by Circana, in a phygital world, there are substantial interconnections between digital and physical retail:
Phygital is all about the data created at the intersection of physical stores and ecommerce. As a strategy, it heavily embraces technology to deliver differentiated and memorable consumer experiences. It is the natural evolution of the growing digitization trends around us, heavily embracing smartphones as windows into the shopping journey. This article looks deeper at these trends and provides examples from my European retail store tours.
The Phygital Consumer Wish List
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It is only September and thoughts of a hopefully happy retail holiday season are already swirling through my mind. Looking back to last year, for the November- December season, retail sales in USA grew 5.3%, to $926.3 billion, falling short of the National Retail Federation’s (NRF) forecast amid continuing inflation and high interest rates. While holiday growth was less than expected, for the year USA retail sales grew 7% to $4.9 trillion, meeting NRF’s forecast of 6% to 8% growth for the year.”
For 2023, NRF has tempered USA retail growth prospects to between 4% to 6%, equaling $5.13 trillion to $5.23 trillion. The good news for the USA economy is that according to JP Morgan, it grew 2% to 2.4% in the first six months this year and is expected to continue to grow at 2% in the second half of 2023.
The elephant in the room remains inflation which is currently going in the right direction. “Core goods inflation has dropped from 12% to 0.8% over the past year, while core services inflation has only slowed to 6.1% in July from its peak of 7.3% in February. JP Morgan expects gradual improvement with inflation over the coming months, though a return to the Fed’s USA targeted 2% could take until late 2024. For the first half of 2024, USA GDP growth is projected at only 0.4%.
An additional headwind this holiday season is high credit card debt. In the United States, consumers are now carrying $1 trillion in credit card debt with the average balance at about $6,000 and more than half of credit card holders worrying about paying their debts. While higher debt, depleted pandemic savings, and inflation are introducing risk of a recession, at a global level, retail will remain resilient.
With all this mixed news, what can we expect for the 2023 holiday season? What are the key trends that will drive shopping behavior in this important shopping time of the year?
Will We Shop Till We Drop This Holiday Season?
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Having just finished my first book on personal branding which will be published later this year starting in the UK, you can guess that I am a big fan on the potential of the concept of branding. When it is well-executed, branding commands higher margins, creates loyal consumers, and creates that special buzz many like to follow.
The advent of smartphones and social media has increased the importance of branding. With the smartphone, we can all provide instant feedback to a brand about our experiences. Social media creates opportunities to generate viral content which increases the value of the brand.
Branding at all levels, including you as an individual, will increase in importance as digitization continues to become ubiquitous. It is for reason, that every year I look forward to the latest Kantar BrandZ most valuable global brands reports.
For the world’s top 100 most valuable brands, their value declined a surprising 20% in 2023 in the face of strong macroeconomic headwinds. The total value of the world’s top 100 global brands now stands at $6.9 trillion. As the research summarizes, reinforcing the importance of paying attention to you brand, “over the 17 years in which we have been tracking the world’s strongest brands, the companies behind the top-ranking brands have outperformed stock market benchmarks.”
This article summarizes the top 10 most valuable global brands in the key categories that I am most passionate about – Retail, Apparel, and Luxury. The actual research is very comprehensive and covers all industries and makes for a good read on differentiation strategies for growth which are critical to brands. All quotes and data in this article are from the Kantar BrandZ report.
The Top 10 Most Valuable Global Brands and New Entrants
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The two hottest buzz words in all industries these days seems to be ‘digital transformation’. Linking these words was actually an evolutionary process that started in the 1970s when computer-aided designs and manufacturing were first used in business. In the 1980s enterprise resource planning was added, followed by customer relationship management in the 1990s.
The objective of these solutions was to improve efficiency and productivity by digitizing manual processes. “In the late 1990s, we saw the rise of eCommerce and online banking. These activities were initially carried out offline but were later moved online as internet speeds increased. This was followed by the introduction of social media in the mid-2000s, which revolutionized how we communicate and share information.”
The pace of change is accelerating. Survival as a company requires intensive focus on increased digital connectivity with consumers and markets.
Here are some interesting statistics of the increased digitized world:
70% of organizations either have a digital transformation strategy or are currently working on one. Global spending on digital transformation is expected to reach $6.8 trillion by 2023. 87% of business leaders think that digital transformation will disrupt their industries. Digitally mature companies are 23% more profitable than their less mature peers. The success rate of digital transformation is below 30%.This article summarizes some key charts from my ‘Disruptive Future of Retail’ global keynote on the accelerated pace of innovation. It highlights major disruptions in the retail industry, general technology trends, two recent examples of online disruption, and ends with an optimistic view on how to increase the success odds of digital transformation above that 30%.
Technology Megatrends Disrupting the World
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The past two weeks have been truly inspirational in activities of continuous learning and sharing knowledge that helps us all have a brighter retail future. The first week was the keynote delivery of my latest edition on ‘The Disruptive Future of Retail’ presentation. The venue was the beautiful PGA National Resort in Florita were 200+ IT professionals attended the Retail Technology Solutions Summit. Impressed by both the format and the engagement of the audience during, after my presentation, and throughout the conference.
The second week included the launch of my new webinar Retail Technology Series which focuses on disruptive retail technologies, new innovative retail revenue streams, and once in a while a check-in on the state of the industry. Over 400 people registered for the first episode which was titled ‘AI’s $9.2 Trillion Impact on Retail through 2029’.
Additionally, in the second week, I had the pleasure of joining senior retail leaders, solution providers, and academia members at the Consortium for Operational Excellence in Retail at Wharton, University of Pennsylvania. The 2023 edition included highly interesting research innovation topics plus some candid retailers’ reflections on the past 30 years and projections on the next 30 for the retail industry.
This article summarizes just a few of the charts included in the keynote at PGA National. If you would like a copy of the full presentation, reach out either on LinkedIn or through my personal website Contact Page.
The full presentation covers the latest global economic headwinds, the challenges facing retail, insights on why retail will continue to be resilient, the pace of technology innovation, the critical future retail technologies, the smarter store of the future, and as title implies, a review of the AI revolution that is underway, including its impact on the retail industry.
Global Headwinds Persist
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It is a Small World
"To succeed in life, you need three things: a wishbone, a backbone and a funnybone." – Reba McEntire
Continuing our global journey to learn something new, our next stop is the Trevi Fountain in Rome. The name "Trevi" comes from the Italian words tre, meaning "three", and vie, meaning "roads". The fountain is located where three roads meet.
A fountain has been located at the Trevi Fountain site for over 2,000 years. The current fountain was designed by Nicola Salvi and built between 1732 and 1762. It's the largest Baroque fountain in Rome.
The Trevi Fountain's water comes from the Acqua Virgo aqueduct, the only functioning aqueduct from ancient Rome. Local lore says that throwing a coin into the fountain will ensure you return to Rome. Other lore says that throwing two coins will lead to love, and throwing three coins will lead to marriage.
Wishes aside, since 2006, a Roman Catholic charity called Caritas has collected the roughly €3,000 a day thrown into the fountain and used it to provide food and social programs worldwide.
Life is one sweet ride. Time flies way too fast. Take a moment. Sit at your favorite place. Imagine the history before you. Live each moment as it was your last. One day, it will be.
Categories
Brilliant Research
Unlocking Shopper Reactions to Secured Products
60% of shoppers report seeing locked-up merchandise on a regular basis. More than a quarter of shoppers say a retailer loses their purchase when items are locked up. 62% of shoppers say they typically wait for assistance when they encounter locked up merchandise, and 9% say they order the item online from that same retailer. - From Numerator.com Read more
Smart Infographic
Retail Media: An Evolving Growth Opportunity that Won't Wait
Retail media is still surging. Ad spending with US retailers is growing 9X faster than traditional point-of-sale shopper marketing. - From Bain & Company
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