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More than half of manufacturer respondents polled for Kantar Retail’s annual PoweRanking report, which identifies best-in-class retailers and manufacturers, with manufacturers ranking retailers and vice versa, cited Walmart as the overall best-in-class retailer due to its scale, sustained strength in logistics and recent investments in digital and e-commerce capabilities. It's led the retailer PoweRanking for 19 out of 19 years.
Among its key strengths, said one respondent: “Walmart is transforming itself and starting to unlock its online/multichannel potential.”
“Walmart’s focus on its omnichannel investments will pay dividends for future growth,” said another.
Kroger, which climbed from the No. 3 spot on the PoweRanking Composite in 2014 to the No. 2 position for the first time, in 2015, has switched places with Target.
"What Kroger has done really well is they’ve used patience with their omnichannel strategy," noted Dan Raynak, EVP for strategy and development for Kantar. "So rather than rushing into it, they’ve taken time to really think through it and be thoughtful of their strategy and they’re getting credit for very clearly communicating what it is that they’re going to do and how they’re going to win, now and into the future. [Then there] is their investment with data. I think the manufacturers are giving them credit and saying here is a retailer using fact based analysis to really understand where they want to go and create strategy around that."
Manufacturers are also appreciative of Kroger's "Customer 1st" strategy, with one noting "Kroger's 'Customer 1st' strategy has been consistent for years, is inculcated throughout the organization, and is delivering results."
Target ranks No. 3 on the PoweRanking Composite with one respondent commenting: "Target will continue to benefit from consistent, long-term focus on building its brand in all shopper touch points."
Another said, "Target remains customer/consumer-focused, with a sophisticated understanding of retail measures, drivers, etc."
Target bested all other retailers in the categories of "Best Store Branding" and "Most Innovative Merchandising Approach."
Costco maintained its spot on the PoweRanking Composite with respondents citing its clear strategy.
"Costco does not get tempted by off-strategy opportunities that consume resources," said one manufacturer. "Its vision is clear and consistent from the c-suite down through the trading desks."
Another lauded its buying teams: "Costco has sophisticated merchants who can take a macro perspective, while staying laser-focused on understanding and growing their categories."
The success of No. 5 ranked Amazon.com (also No. 5 on the 2014 list) is due in part to its grasp of what's motivating Millennials, said one respondent: "Growth and momentum will make Amazon a power retailer long-term. They understand where Millennials are going and at the same time are accommodating other generations."
Amazon's is also spurring regional retailers to shore up their game, noted Kantar's Raynak.
"Amazon has continued to get bigger and more powerful and moved into AmazonFresh and it's forcing a lot of these power regionals to really hone their strategy and get tighter, so it's making others become more disciplined in declaring where they're going to play and how they're going to win," he said.
"A notable trend in the rankings is a bit of a shift toward some of the power regionals such as Meijer, H-E-B, Wegmans and Publix," said Taylor Wray, research director at Kantar. "The same goes for some of the newer and more niche players like Aldi and Trader Joe's — while not in the Top 10 [rankings], we've seen them move up through the 20s and teens in recent years, so they're making waves."
Publix remained No. 6 on the composite ranking but improved its position on the list of Retailers Projected to be "Power Retailers" in 15 years; the list of Best Retailers to do Business With; and the Most Innovative Merchandising Approach list.
One respondent said "Publix has innovated with disciplined center store display executions between adjacent categories and differentiated perimeter offerings that allow them to realize a price premium, while still providing a fair value proposition to their consumers."
No. 7 ranked H-E-B was praised for its merchandising approach with one respondent noting: "H-E-B stores are expertly tailored to their local communities and offer unique merchandising across promo solutions."
Meijer made the best year-over-year progress in terms of its ranking on the composite list, jumping from No. 11 to No. 8.
"One of the things that they've done is really reached out to manufacturers in terms of partnership and the past few years have said 'we're really ready to test with you, our stores are ready,'" said Ginny Valkenburgh, SVP, Kantar. "They're segmented so manufacturers have found them really easy to partner with. They bring a team together so everything can happen at once. That's what manufacturers are recognizing in their ranking."
Wegmans moved down one spot on this year's composite list to No. 9, but gained three places on the list of Best Practice Category Leadership.
"Wegmans continues to win with their deep understanding of their categories, strategic focus on future and global trends, and very carefully curated assortment," a respondent said.
Drug chain Walgreen Co. ranked No. 10 on the composite list, down from No. 9 last year.
"Connections run deep with Walgreens, including regular joint planning to drive continuous improvement. An open and transparent relationship," said a manufacturer.
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