US Insights

Amazon's mission of disruption makes it world's most valuable retail brand

Ross Tucker

Executive Editor Kantar US Insights

Retail 12.13.2016 / 10:30

AmazonWarehouse

The online behemoth has continually pushed into new areas, increasing its value along the way.

Amazon’s efforts to expand its dominance across consumer categories continued to build in 2016 and have made it one of the world’s most valuable retail brands.

Amazon was named the world’s most valuable global retail brand for 2016-2017 in Kantar Millward Brown’s BrandZ Top 25 Most Valuable Global Retail Brands report. The online behemoth boasts a brand value of $99 billion, representing a 59% change in brand value compared with the same period a year ago. Amazon’s value bested marquee names like Alibaba, Home Depot, Walmart, Ikea and Costco by a wide margin.

Retailer Brand Value Top 10

“The business is now as much a technology and media company as it is a retailer,” said the report. “It offers music streaming by subscription, was behind 16 Emmy nominations for original content in 2016, and Amazon Studios has released its first original movie, "Chi-Raq," directed by Spike Lee.”

Amazon is proving it is truly omnichannel and has clear intentions of disrupting retail experiences across product categories. While online represents the bulk of its business, the company is testing out physical stores and is seeing early signs that voice-command sales are likely to be the next wave of revenue generation.

“On Prime Day in 2016…more than 85,000 items were sold in the US through Alexa voice activation alone. Subscriptions taken out on Prime Day in 2016 were up more than 30% over 2015,” noted the report

On Dec. 5, the company unveiled its first small-format grocery store, Amazon Go. With the help of the Amazon Go app, shoppers can simply grab the products they want and walk out of the store. No checkout line hassles.

“With a size of prize close to $480 billion in 2016 supermarket and convenience store sales, Amazon knows that to become the retailer they wish to be, they have to unlock the key to grocery,” said Robin Sherk, Director with Kantar Retail. Amazon Go, along with Prime Now, Prime Pantry and Amazon Fresh are all part of their plan to add their variety of grocery shopping platforms to the shopper’s share of stomach.”

Kantar retail analysts question whether Amazon will be able to scale the Go concept up to thousands of stores. It also remains to be seen whether Prime members will receive any added benefits in the format. Lastly, it's likely that other grocery chains will develop their own technology to allow customers to skip the checkout line. The added value of the Amazon Go concept, therefore, could be short lived.

Source: Kantar, Kantar Millward Brown, Kantar Retail


Editor's Notes

Methodology: Kantar’s BrandZ relies on research of some three million consumers and more than 100,000 brands in 50 markets. The studies combine measures of brand equity based on interviews with analysis of the financial and business performance of each company. 

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