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Amazon Kicks Off Prime Day Crowned World’s Most Valuable Brand

While competitors are hoping to steal some of the Prime Day shine once again, Amazon has gained so much clout as a global brand that it is set to be in full control of the two-day sales event this week.

One study from Kantar ranked Amazon as the world’s most valuable brand for the third consecutive year, growing 64 percent to $684 billion, illustrating the company’s dominance over the not just the retail industry, but all consumer-facing sectors. The next retailer on the list is Alibaba at No. 7, valued at $197 billion.

With the e-commerce giant cracking $8 billion in first-quarter profits, Amazon shows no signs of slowing down ahead of what is the company’s largest yearly sales event. The Kantar BrandZ Most Valuable Global Brands 2021 report found that few brands exemplify the values of convenience, speed and customer satisfaction like Amazon does, and this has delivered an incredible amount of loyalty—the e-commerce giant now commands 200 million Prime subscribers, up from 150 million at the beginning of 2019.

EMarketer anticipates Amazon’s 48-hour Prime Day sales will reach $11.8 billion, a 19 percent jump over the $9.9 billion the consultancy estimated it generated last year, when it held the event in October.

Meanwhile, a new report indicates more good news ahead for Amazon. FTI Consulting’s 2021 U.S. Online Retail Forecast indicates that 62 percent of 1,000 Amazon Prime Day shoppers intend to spend more during this year’s event than they did in 2020.

That majority includes 36 percent who said they intend to spend “significantly more,” which benefits all e-commerce players but certainly doesn’t take away Amazon’s edge. Only 9 percent of those surveyed said they would spend less on Prime Day this year.

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But even beyond Prime Day, the continued elevation of Amazon as a global brand combined with increasing online spending shows that everyone else still has to play catch-up.

In total, the retail and consumer products practice at FTI Consulting anticipates U.S. online retail sales to reach $865 billion in 2021, a projected 13.5 percent increase over 2020. The online channel’s share of U.S. retail sales (excluding auto and gas) is expected to reach 20.5 percent in 2021, compared to 19 percent in 2020, once again playing into the hands of the digital juggernaut.

“There will be no return to pre-pandemic shopping habits for a large majority of consumers, and this will tend to benefit large online and omnichannel sellers, most of whom are general merchandise retailers,” J.D. Wichser, leader of the retail and consumer products practice at FTI Consulting, said in a statement.

Earlier this year, eMarketer pointed out that Amazon’s share of total U.S. e-commerce sales was projected to increase from a previous mark of 39.8 percent to 40.4 percent in 2021. That 0.6-percentage-point share gain is larger than that of any other company this year, the consultancy said in April. In total, e-commerce sales at Amazon are projected to grow 15.3 percent in 2021 to $367.3 billion.

Amazon outperforms Big Tech in brand value

Amazon’s presence as the top brand in the Kantar report illustrates how much the company stands ahead of not only retail, but the most influential companies worldwide. It is only one of two companies valued at above $500 billion, with Apple being the second-highest at $612 billion on 74 percent growth, and global tech titans including Google, Microsoft, China’s Tencent and Facebook farther down the list.

After Alibaba, the next retailer comes in at No. 25 on the list (The Home Depot), with Walmart lining up at No. 30. Nike leads the apparel category at No. 17 overall.

To develop the Brandz report, Kantar examines relevant corporate financial data and conducts ongoing, in-depth quantitative consumer research of more than 170,000 shoppers worldwide. From there, a team of analysts combine these inputs with a financial model of the business to determine the brands’ ability to generate value.

“2020/1 has been a record year for brand growth, and despite many facing a difficult year, our research has again proven that strong brands deliver superior shareholder returns, are more resilient and recover more quickly,” said Nathalie Burdet, chief marketing officer of Kantar. “With global e-commerce growing from 12 percent to 15 percent of all sales in 2020, it has been a positive year for brands involved in that value chain—from the retailers through to the couriers like FedEx and UPS. However, we have also seen growth in industries where many were predicting challenges early in the pandemic. Apparel brands for example have collectively grown even more than media and entertainment brands in the ranking, and luxury brands, despite reduced travel and lockdowns globally, have refocused their energies and seen growth as a result.”

Apparel leads way in value growth

The apparel category in total saw brand value growth of 53 percent, as shoppers throughout the pandemic redefined the boundaries between workwear and leisure wear. Adidas, Nike, Puma and Lululemon all secured 50 percent or more value growth from year to year. Collectively, fast fashion did not grow as fast, but Uniqlo (88 percent brand value growth) and H&M (47 percent brand value growth) grew valuations significantly.

Across apparel, total value of the top 10 brands was $180 billion. The 53 percent growth surpassed the rates of all six categories that had been studied in previous years.

Overall, the 100 brands on the list increased their value 42 percent in 2021 to $7.1 trillion compared to a 6 percent increase in 2020, amounting to a gain of $2.1 trillion in total brand value and illustrating the acceleration of disruptive companies in the wake of the Covid-19 pandemic.

“This year’s results show that brand building remains critical to securing growth,” said Burdet. “We track the stock market performance of our strongest brands and have seen these recover twice as fast as other key indices. Our analytics have uncovered that 70 percent of what makes a brand successful is executing four fundamentals well: providing superior experience across consistently branded touch points, a range of well-designed and functional products and services, convenience, and exposure through great advertising. However, Covid-19 has emphasized consumer values such as trust and reliability. Those brands that are evolving their values, projecting leadership on these issues are demonstrating differentiation and standing out.”