A global report by Interbrand recently released a list of the UK’s most valuable retail brands. The winner is—no surprises here—Tesco.
The list, which included big names on the retail scene such as Waitrose and ASDA, was released this week. Tesco is valued at £6.2 billion followed by Marks & Spencer (£3.7 bn) and Boots (£1.5 bn). The report suggests that Tesco’s 2010 marketing strategy has indeed been successful.
Tesco invested more in marketing and branding in 2010 than its competition, highlighting the brand’s commitment to good value and a positive shopping experience. Tesco also expanded its brand through a Clubcard as well as mobile apps and online experiences.
Marks & Spencer had a distant second place rating and a completely different branding strategy. M&S avoided price-oriented strategies and focused on long-term branding issues such as sustainability.
According to the Interbrand report, slashing prices and failing to market was the top mistake made by UK brands in 2010. This strategy may seem wise in light of the recession and government austerity, but they don’t pay off because consumers are so easily wooed away by a competitor offering a superior brand at just a few pence more. However, introducing ‘value’ lines was one strategy that worked well, with Waitrose’s Essentials value range bumping the company into the ninth most valuable position.
The challenge in this economy is to offer more for less, a brand strategy that Tesco has mastered. While most people in the UK consider Tesco the ‘bargain’ option, the company has not compromised in issues such as marketing, customer experience, and overall quality. This has led to a growing customer base and growing profits as well. It points to one very important branding strategy in the current UK: offering a brand that allows customers to stretch their pounds without huge reductions in value.
Here is the full list of most valuable UK brands:
1. Tesco $10.1bn (£6.2bn)
2. Marks & Spencer $6.1bn (£3.7bn)
3. Boots $2.5bn (£1.5bn)
4. Asda $1.4bn (£0.9bn)
5. Next $1.3bn (£0.8bn)
6. Argos $912m (£565m)
7. Sainsbury’s $849m (£526m)
8. Morrisons $429m (£265.9m)
9. Waitrose $338m (£209.5m)
10. Debenhams $202m (£125m)
How has your brand fared over the past year? Have you effectively cut off your own legs by slashing your marketing and branding budgets? Do you have a UK logo design that will be compelling to the new UK customer? With no end in sight to our economic downturn, there was never a better time to ask yourself these important questions.
Note that the report did not address popularity or other branding issues. Tesco may not be the UK’s most popular retail brand or the one with the most brand equity, but it is most definitely the UK brand with the most actual value—as in worth. When UK shoppers need to do their routine market trips, Tesco is still the place that most shoppers will turn to. How does your UK small business brand measure up?