Cannondale's 2008 PoweRanking Reflects Shopper Experience

In an environment where stores are placing more emphasis on the individual shopping experience, and an unprecedented need has arisen for manufacturers and retailers to collaborate and target specific shopper groups with localized insights and marketing programs, Wal-Mart and Procter & Gamble were named the "best of the best" in Cannondale Associates' 12th annual PoweRanking Study.

This year's study, dubbed "Full Tilt," highlights increasingly shopper-focused retail environments by identifying the manufacturers and retailers that have sustained positive performance over time.

For the tenth straight year, Bentonville, Ark.-based Wal-Mart captured the top retail slot by a wide margin, staunching the two-year bleed-out from its composite score. Kroger rose significantly in the 2008 ranking to reach its third-place behind No. 2 Target. Publix was another noteworthy gainer, improving by 1 point to rise to fourth place from seventh in the composite this year.

Walgreens also returned to the top 10, following two years of declines. The other top retailers were Costco, Safeway, Wegmans, HEB, and CVS.

Ranking criteria for retailers included those with the clearest company strategy, those best at store branding, those that were the projected power retailers, those that were the best retailers with which to do business, those with the best category management/buying teams, those with the most innovative consumer marketing/merchandising, those with the best supply chain management, and those with the best practice category management/CMAR.

In 2008, retailers were also evaluated on their cost management abilities, because of the growing importance of this discipline with the dramatic shift in economic conditions this past year, but these rankings weren't included in the overall composite score, Cannondale said.

"Retailers that excelled in the PoweRanking in 2008 have completed their own customer segmentation, and begun to develop alternative store formats and merchandising platforms to address newly identified needs as a result of this segmentation work," noted Ken Harris, managing director at Cannondale.

Among the manufacturers that made the PoweRanking cut, Procter & Gamble kept its first-place position in 2008, despite a considerable decrease in its PoweRanking composite score. Kraft and PepsiCo weathered slight declines, but managed to hold on to their respective No. 2 and No. 3 spots.

General Mills and Nestle, meanwhile, experienced significant gains of 3.2 points and 3.6 points, respectively, to complete the top five. Coca-Cola also made a strong showing, rising to seventh place, while Clorox returned to the top 10 after a two-year absence.

The rest of the top manufacturers were Unilever, Kimberly-Clark, and Kellogg.

"Given the state of the economy and the need for retailers to differentiate themselves in the marketplace, collaborative efforts between retailers and manufacturers has never been more important," said Harris. "Retailers are demanding that manufacturers provide focused insights pertaining to their shoppers. The large and midsize manufacturers who have been able to provide these insights are winning in the marketplace."

The composite scores for manufacturers were based on rankings in eight key areas where manufacturers interface with retailers: clearest company strategy, most important consumer brands for retailers, best combination of growth and profitability, best sales force/customer teams, most innovative marketing programs, most helpful consumer/shopper insights and category management, best supply chain management, and best shopper marketing programs. As with the retailers, cost management was included as an evaluation for manufacturers, but the rankings from this measure weren't included in the overall composite score.

To provide trended information over time, the PoweRanking measures are calculated on a rolling two-year basis.

Sales and marketing management consulting firm Cannondale Associates has offices in Wilton, Conn. and Evanston, Ill., and is part of Kantar and WPP. Cannondale also publishes benchmarking studies on trade promotion spending strategies, category management/consumer marketing at retail (CMAR), and foodservice.
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