Retail branding

Tom Dougherty, CEO – Stealing Share

28 January 2019

Walmart’s success is due to others’ awful retail branding

Here’s a shocker. Walmart is crushing the retail sector. No, I mean to the point where retail branding will eventually only be left with Amazon and Walmart.

The retail giant expects a $2.5% gain in same-store sales this year. A new Morgan Stanley report says Walmart is gaining share in grocery, apparel, home furnishings and ecommerce.

retail brandingThat just about covers everything connected to retail branding.

Why is this? It’s easy. Retail branding sits at an all-time low in terms of meaning. It’s the reason Sears hangs by the life of its CEO’s wealth. So many are dying that the list is too long to mention.

We’ve written extensively that retailers must rethink their models. But, at the very least, chains must – MUST – rethink their own retail branding.

“And the thing is it’s all the other retailers’ fault. Few have ever invested in its retail branding enough to mean something to target audiences. It’s all about cost or the brands they have.”

Retail branding is all the same

You see, here’s the problem. Retailers believe they can succeed by copying the market leader (Walmart). But all things being equal, consumers default to the market leader.

And all retail branding is equal. Walmart owns low prices. So what do other retailers do to combat that? Promote their low prices.

So. If you shop based on price, Walmart will always win. Why would you go anywhere else when Walmart’s cost control allows it to always have the lowest price?

Here’s what should make retailers tremble with fear. Walmart owns 15% of total retail sales. That’s enormous, and threatens to grow ever further. In fact, Walmart now owns a whopping 23% of grocery.

And the thing is it’s all the other retailers’ fault. Few have ever invested in its retail branding enough to mean something to target audiences. It’s all about cost or the brands they have.

In today’s world, especially with Amazon lurking around, those don’t make you a true choice. They just say you are another retailer to ignore.

That’s why I don’t have much sympathy for dying retailers. They made their own beds. And Walmart owns those beds.

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