Woolworth’s brand has lost some of its shine.
WOOLWORTHS has lost its crown as Australia’s most valuable brand, in another blow to the retailer’s fortunes.
After seven years at the top of Brand Finance’s annual list, Woolies has been overtaken by Telstra as its brand value took a 14 per cent hit, sinking to $11 billion ($US7.8 billion).
The news comes as the supermarket chain battles to meet the challenge of discount retailer Aldi, while quietly closing many of its high-end Thomas Dux stores.
It’s been a difficult slog for the ‘fresh food people’, with the company posting one of its worst results in 22 years in 2015, as its net profit slumped by $31 million.
Woolworths has also come under fire for continuing to operate its loss-making hardware subsidiary, Masters, while it hamoraged up to $1 billion in recent years.
The company finally gave in last month, announcing plans to cuts its losses by selling — or winding up — both Masters and Home Timber & Hardware. The analysis used for Brand Finance’s 2016 ranking was carried out before this announcement.
Australia’s most valuable brands, as ranked in Brand Finance’s Global 500.Source:Supplied
For some supermarket shoppers, it’s the simple things that have eroded the Woolworths brand, like being unable to find a basket when entering the store. Even an initiative to provide children with free fruit was criticised, with some parents labelling it “unhygienic”. Brand Finance Australia managing director Mark Crowe said Woolworths needed to reinvest in its brand. “With sales expecting to slow at faster rates than rivals, the biggest challenge to Woolworths and other supermarket operators is coming from the German discount chain Aldi,” Mr Crowe told Fairfax.Moving into the number one spot, telecommunications giant Telstra saw its brand value spike by 23 per cent to $15.1 billion ($US10.7 billion).The turnaround has been credited to the efforts of new chief executive Andy Penn, along with the groundwork laid by his predecessor David Thodey.Optus and all of the big four banks made the list, as did Woolworths’ main competitor, Coles — which lagged five places behind it.On the global stage, tech companies dominated; Apple and Google were named the world’s most valuable brands, followed by Samsung, Amazon and Microsoft.
AUSTRALIA’S MOST VALUABLE BRANDS
1. Telstra
2. Woolworths
3. ANZ
4. Commonwealth Bank
5. Westpac
6. National Australia Bank
7. Coles
8. Optus
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