Walmart, Kroger in Virtual Tie for Top Retailer: Kantar PoweRanking
Walmart and Kroger finished in a virtual tie for the No. 1 position among retailers in Kantar Retail's 2016 annual U.S. PoweRanking survey, which for the first time in 20 years, joined forces with Progressive Grocer and The Path to Purchase Institute (sister brands of EnsembleIQ) to both conduct and help amplify the insights gleaned from the in-depth research.
Among suppliers, PepsiCo and Coca-Cola have topped the rankings of best-in-class manufacturers, earning their highest historical rankings ever in the annual benchmarking study, which Kantar Retail has now conducted for 20 consecutive years.
While Walmart’s long-standing dominance among U.S. retailers now has a formidable challenger, the supercenter chain continues to outrank all other retailers in the areas of clear strategy and supply-chain management. One manufacturer noted: “Walmart has consistent, clear, widespread strategies.”
A major factor in Kroger’s performance this year has been its ability to innovate and maximize the shopper experience by applying insights derived from both suppliers and its own 84.51 shopper insights firm.
Manufacturers voted Kroger No. 1 in the categories of “best retailer to do business with,” “best buying teams,” “most innovative merchandising” and “best practice category leadership.” One manufacturer summarized: “Kroger has developed strong collaboration and partnership with manufacturers, and they continue to deliver strong business results.”
Daniel Raynak, Kantar Retail’s EVP of strategy and development, remarked: “Perhaps the quote that best summarized 2015 was, ‘Never before has so much change produced so little value for the industry.’ As we entered the 2016 calendar year, many of the same trends of 2015 continued, all of which reinforce the idea that we are in an era of permanent transition and change. However, those organizations that have embraced the change in 2016 and took swift actions against big, relevant opportunities are beginning to see the return on the changes they have implemented.”
Grocers Make Strong Showing
Walmart topped the ranking with a score of 47.3 percent, with Kroger only a tenth of a point behind. The Bentonville, Ark.-based mega retailer’s strengths were summarized as “perennial powerhouse driving large-scale growth and supply chain efficiency.” Kroger, the nation’s largest traditional grocer based in Cincinnati, is a “sophisticated, innovative marketer voted best retailer to work with,” according to the report.
Three other traditional grocers ranked in the top 10: Florida’s Publix, at sixth place; Texas-based H-E-B, ranked eighth; and New York’s Wegmans, in ninth place.
According to manufacturers participating in the PoweRanking, Publix is a “regional grocery leader with winning strategy and top-class supply chain”; H-E-B is a “Southern power player ranked No. 1 for multicultural marketing in 2016”; and Wegmans is a “world-class merchandiser with strong branding and diehard shopper base.”
Wegmans also led Kantar’s top 10 list of retailers with less than $10 billion in annual revenue. Three other grocers placed in this ranking: Iowa-based Hy-Vee, Idaho-based WinCo Foods and Pennsylvania’s Giant Eagle (PG’s 2016 Retailer of the Year).
Shift in Supplier Rankings
Knocking Procter & Gamble from its longtime perch atop the ranking (P&G dropped to third place this year), PepsiCo showed broad improvement across many of the strategic and operational metrics measured in the study.
The company was particularly praised for providing top-class capabilities in the area of data analytics. One major retailer noted: “PepsiCo has embraced the data and has brought new insights and analytics. They have really transformed the conversation [between our companies].”
Coca-Cola received the top ranking for innovative marketing, receiving plaudits from retail partners for creative campaigns, such as “Share a Coke.” One retailer commented: “Coke is building the interest of consumers with their new ‘Share a Coke’ campaign. The customers are excited to look for their names or favorite songs on the bottles.”
Rounding out the rest of the suppliers’ top 10 were General Mills, Kraft Heinz, Kellogg, Unilever, Johnson & Johnson, Nestle and ConAgra. (Kraft Heinz is new to the ranking since Kraft Foods, ranked fifth last year, merged with Heinz; 2015 votes for Kraft Foods Group and Heinz Co. were reallocated to Kraft Heinz in 2016.)
The purpose of Norwalk, Conn.-based Kantar Retail’s annual PoweRanking study is to identify the manufacturers and retailers viewed as best in class by their major trading partners and to provide insight into what distinguishes them across key areas of the manufacturer-retailer business relationship.
Last year, more than 600 retailers and manufacturers participated in the 2015 survey. In support of the 20th anniversary of the study, Kantar Retail is partnering with The Path to Purchase Institute, a global association serving the needs of brand manufacturers, retailers, agencies and the entire ecosystem of solution providers along the path to purchase, and Progressive Grocer, both divisions of EnsembleIQ.
“In 1997, PoweRanking was created to help both manufacturers and retailers understand what great looked like,” said Dan Raynak, Kantar Retail's EVP of strategy and development. “It has now become a strategic roadmap of where the industry is headed and an assessment of who is perceived as ‘Best in Class’ now and into the future. In 2016, we are pleased to announce that the Path to Purchase Institute / Shopper Marketing magazine, Progressive Grocer and EnsembleIQ's other publications are helping us celebrate this milestone by endorsing the study, helping to get the message out, and providing insight into how we can make the next 20 years even more beneficial for the trade.”
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