Wednesday, December 17, 2014

Which Retailers Have the Best Reputations?

By Tim Denman — May 12, 2014

Nielsen's 15th annual look at the US corporations with the best reputations featured 14 retailers. The "Harris Poll 2014 RQ" analyzed over 14,000 individual interviews to determine the coveted list of the top 60 companies with the best reputations.

As a whole, the reputations of US corporations are on the rise, with nine companies (six last year) receiving Reputation Quotient (RQ) scores of 80 or above, the standard of excellence. The retail industry however, fueled in no small part by the rash of data breaches last winter, has three of the largest RQ score declines year-over-year.

A company's RQ score was determined through the analysis of six metrics: social responsibility, emotional appeal, products and services, workplace environment, financial performance, and vision and leadership. The RQ scores are based out of 100 with 80 and above considered excellent; 75-79 very good; 70-74 good; 65-69 fair; and 55-64 poor.

The 14 retailers that made the top 60 were:

Amazon. The online leader came in first place for the second year in a row. In addition to topping the main list, the retailer also dominated the emotional appeal and product and services subcategories. This marks the 6th year in a row the company received an excellent rating. RQ Score: 83.87

Apple. Apple took home the number three position, down one stop from its runner-up status last year. The retailer received top five ratings in product and services, vision and leadership, financial performance, and workplace environment. RQ Score: 81.76

Costco. The big box retailer took the 6th spot in the report, moving up four spots from last year's 10th place return. The club store finished 2nd in emotional appeal and 5th in workplace environment. RQ Score: 80.75

Whole Foods Market. The organic grocery store chain came in 8th place overall powered by a 1st place finish in social responsibility and a 5th place finish in vision and leadership. The positive reputation is having a serious effect on the bottom line with sales projected to increase to $25 billion over the next five years.RQ Score: 80.45

Home Depot. The home improvement powerhouse finished in 17th place, a drop of one position year-over-year. The retailer is in the midst of bridging the gap between online and in-store through customer and associate facing apps that could likely up its cool factor and help it rebound its RQ score next year.  RQ Score: 77.47

Kohl's. The department store chain came in 19th place overall and finished in 4th place in the emotional appeal metric. No surprise the retailer cracked the top 20 with innovations like the connected fitting room on the horizon. RQ Score: 77.15

Lowe's. Lowe's RQ actually increased by .93 points year-over-year, but the home improvement retailer dropped five positions to 22nd on the list. The lower position can be attributed to the positive reputational improvements the rest of the field enjoyed rather than a Lowe's misstep. RQ Score: 76.60

Macy's. The department store chain finished in 24th place for the second consecutive year. The leader of the omnichannel movement is committed to cultivating an engaging customer experience through a host of customer-facing initiatives. RQ Score: 75.89

Nordstrom. The upscale department store chain finished in 26th place and was just the 9th retailer named. This was the retailer's first appearance in the study. RQ Score: 75.30

Best Buy. The electronics retailer improved 5.2 RQ points year-over-year to take the 34th position on the list. Best Buy has boosted the public's perception of the company with the introduction of price match and bullish stock performance in 2013.  RQ Score: 71.13

Target. Not surprisingly following a wide-spread data breach that saw 70 million customer credit cards compromised, Target experienced the biggest RQ decline year-over-year with a drop of 5.9, finishing in 39th place.  RQ Score: 68.91

Walmart. The big boxer dropped four positions year-over-year landing in 44th place in 2014. The retailer is down 2.74 RQ points compared to its 2012 results. RQ Score: 66.51

JCPenney. The iconic American department store experienced the second biggest RQ drop year-over-year with a loss of 5.6 points. With CEO Mike Ullman back in the driver seat, there is hope that the retailer can emerge from its on-going decline and improve on its 48th place finish next year. RQ Score: 63.56

Sears Holdings Corporation. Sears dropped seven places year-over-year, finishing in 53rd place. The American institution's decline is well documented and unless it can pull a 180 its biggest future returns will likely come from selling off its immense real estate holdings. RQ Score: 60.30

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