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Sunday Times TNS Research Surveys Top Retail Commentary

Overview
The Sunday Times annual Top Retailer Awards were established some years back to recognise innovation and growth within this sector.  This year, a new research partner – TNS Research Surveys – has been appointed and this has enabled a complete make-over of the study to align it with the latest thinking about retailers to be undertaken. In addition, the survey this year has been significantly increased in scope: 3 500 adults covering both metro and non-metro areas (a significant change from past surveys that looked at Gauteng only).  This means that there has been quite a shake up in many categories.  In addition, wealthier areas were over-sampled so that smaller, more niche outlets would have a sufficient base size to be included in the analyses.  However, note that the data has been weighted back to be representative of the adult (18 years and older) SA population as estimated by StatsSA.

How we did it
This year we asked people to say which retailers they used regularly and then to rate all the retails they knew on a points-out-of-ten basis.  From this, we looked at how large a retailer is in terms of users.  Then we calculated a new measure – informally termed “Retail Clout” – that looked at how much better a retailer was rated than average amongst its users and then amongst its non-users.  

This tells us if a retailer’s users are much happier than the users of other retailers, and if a retailer is more aspirational amongst its non-users than average.  By combining these measures, we allow not only large retailers to shine but also smaller retailers that are much loved or desired.

The new algorithm
A retailer can be a winner in one of three situations:

1. If it is big AND rated above average by both its users and its non-users
2. If it is truly big but perhaps only rated as average by its users and non-users
3. It is smaller but very well loved by its users and is aspirational amongst its non-users.

Hence, the algorithm we used looks at both aspects of a brand: its size AND its relative advantage over other brands in terms of how it is rated.  This adds an extra dimension to the final score that a retailer can achieve and is in line with the new emphasis worldwide on the shopping experience.

The categories
The list of categories for the 2009 Top Retailer study was chosen in workshops involving TNS Research Surveys, the Avusa sales, management and research teams, and editorial.   The number of categories has been considerably increased this year: the much larger sample has enabled previously large categories to be split into more tightly defined groupings that better represent competitive sets.

Some categories were asked of everyone whilst others were restricted to metro areas only due to their small non-metro footprint.   In total there are 36 awards.

So – what are the results?
Due to the large number of category splits and changes, as well as the much improved coverage of the study, there are many changes compared with last year – and also many new winners in the more tightly defined categories, so comparisons with last year should be made very cautiously.

As a broad generalisation, there are generally smaller differences in ratings amongst users of the various retailers than we saw in the recent Top Brands study, which used the same methodology.  Clearly, there is fierce competition between retailers – but there is also an opportunity, in line with the new emphasis on the shopper (as distinct from the consumer or end-user), for retailers to re-look their whole shopper environment and shopper experience in an effort to differentiate themselves from competitors.   What this also means is that many retailers do well more by virtue of their footprint – their sheer market presence – than by virtue of the attraction of their brand image.  Obviously, a “star” retailer will be both big and attractive.

Some of the shifts in existing categories are given next:

• Two new brands enter the top three for shoe stores – Nine West and Green Cross – pushing our Shoe City and Bata.  Both these new entrants had very good user and non-user ratings.
• Only Edgars, Woolworths and Truworths juggle for various positions in the top three in the clothing store categories, pushing aside Markhams (men’s clothing stores) and Jet (women’s clothing stores).  All three, especially Woolworths, had good user ratings and excellent non-user scores.
• Whilst The Baby Company (at Ackermans) is again top in the specialist baby and child stores category, two new toy stores enter the top three – Reggies and Toys R Us and oust Edgars and Baby City.
• In the beauty and health store category we see Red Square as a new entrant (due to its better user and non-user ratings) into the top three with Dischem dropping out – Clicks retains its top position.
• Game disappears from the top three (it was top last year) in the department store category, allowing Edgars, Woolworths and Truworths to be placed top with Woolworths receiving especially good ratings.
• In the jewellery category, Arthur Kaplan replaces Galaxy in third place but American Swiss and Sterns remain at the top.
• Specialist sport and outdoor show no changes from last year with Totalsports, Sport Scene and Nike remaining the top three.
• Tiger Wheel and Tyre won the tyre and auto fitment centre category.  It should be noted that this category has been redefined and last year’s winner, Midas, was no longer included in this category.  Tiger showed good aspirational pull.
• Within the convenience forecourt stores we see that Woolworths Food Stores at Engen garages has managed to make into the top three this year – and Engen Quick Shop rises to top position with BP Express Shop (Pick n Pay Express/Wildbean) second, pushing Shell Select out of the top three.  Woolworths showed the best user experience.
• Game, Hi-Fi Corporation and Makro retain their respective first, second and third places in the electronics, computers and gadget stores category.

An exciting retail development is seeing township centre Maponya mall stepping into third place in the shopping centre winners for Gauteng – but Menlyn retains its top position followed by Sandton City/Nelson Mandela Square, pushing last year’s two East rand contenders out.

Of course, with the national coverage in this year’s study, other cities enter the fray.  In cape Town, the V & A waterfront takes the top spot with an excellent user experience score, followed by canal Walk and the Cavendish Precinct.  In Durban, Gateway tops the list with the Pavilion a close second.  La Lucia mall is third.  If one looks at all major shopping centres throughout the metro areas, Menlyn Park and Sandton City/Nelson Mandel vie for the top spot, with Gateway a close third.

In terms of new categories –

• Retail liquor chains is won by Tops at Spar, followed by Pick n Pay Liquor and Makro (mostly on the grounds of footprint) whilst Independent liquor stores is won by Liquor City with Ultra Liquors and Solly Kramers next.
• Shoprite wins the supermarket and hypermarket category by virtue of sheer size with Pick n Pay and Spar next.  Woolworths, despite a much smaller footprint, did very well in the user and non-user ratings, coming fourth ahead of Checkers.
• Wholesalers was won by Trade Centre and then Makro, despite small user bases, because of better than average user and non-user ratings, this pushing the bigger  Boxer to third.
• Spur easily wins the Fast Food – Burgers category with Wimpy and McDonald’s vying for second and third.
• KFC totally dominates the Fats Food – Chicken category with good user scores and a very high aspirational pull, as well as total market dominance.  Nando’s and Chicken Licken are next.
• Fast Foods – Pizza is also easily won by Debonair’s followed by Roman’s but the much smaller Primi Piatti is third by virtue of an exceptionally good user experience score.
• Family sit-down restaurants is won by Spur with Wimpy and Ocean Basket next: the much smaller Primi Piatti is fourth again by virtue of good user ratings.
• Family sit-down – Seafood restaurants was won by Ocean Basket, both on the basis of size and good ratings, followed by Something Fishy and Cape Town Fishmarket.
• Coffee outlets were completely dominated by Mugg and Bean, with Wild Bean Café and House of Coffees vying for the next two places.

People were asked which outlets they felt were best for bulk shopping and here Pick n Pay is top with Shoprite a close second.  However, the order is reversed in the “Best for top-up shopping” with Spar a creditable third.  Using people’s responses to four key retail attributes – quality, range, service and value – Pick n Pay won the overall retail experience award by virtue of exceptional scores on quality, range and service.  Shoprite came second with a much-better-than-average score on good value.  Checkers was third and Woolworths fourth with a very good quality image.
 
Moving away from food and drink to more specialist outlet types -

• Exclusive High Street Stores is convincingly won by Levi’s followed by La Coste and Uzzi, this sequence being dictated more by size than by much differentiation is the rating results.
• Home furnishing stores showed a close race for first and second (Mr Price Home and Boardman’s) with Sheet Street third.
• Furniture stores is one of the largest categories and was won by Geen and Richards largely on the basis of excellent ratings despite its smaller footprint.  Morkels and Bradlows  follow.
• CTM won in the Hardware and building stores category, followed by Builder’s Warehouse and Build It.
• CNA, Exclusive Books and CUM book stores were the top three in the books category.
• Reliable, Musica and Top CD were the three music category entrants. 

The Grand Prix Award is based on the scores of all the retail brands measured, regardless of category.  This award was easily won by KFC with an index score of 98.3.  Edgars at 83.2 and Shoprite at 79.7 make up the top three. 

For more details, please contact Neil Higgs, Director: Innovation and Development, TNS Research Surveys on 011-778-7500 or 082-376-6312.neil.higgs@tnsglobal.com                                  www.tnsresearchsurveys.co.za