MSW’s RDE Analytic Framework rests on a study that found that three equity dimensions (Relevance, Differentiation, Emotion) are responsible for driving a significant portion of brand growth and brand strength. Our ongoing Chart of the Week series is dedicated to sharing RDE and CCPreference® Brand Strength results for a variety of categories.

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The holiday shopping season puts beleaguered brick-and-mortar retailers under the gun to perform.  This Brand Strength Monitor and RDE Assessment taken in the run-up to the holiday season among 500 men and women for eight major Department Store brands led to the following insights:

• Retailing success story Kohl’s leads the pack in both RDE composite and brand preference.  Kohl’s is particularly strong in terms of relevance, bolstered by favorable locations (strip or power centers rather than enclosed malls), smart traffic-building tie-ins (Amazon, WW, Aldi, Planet Fitness), data-driven merchandising and a general shopper-friendly atmosphere.  Kohl’s higher than expected Preference is among older (55+) people in the Midwest who are light department store shoppers..

• Off-price retailer Ross Stores is another success story.  Much more than any other retailer studied, Ross’ RDE and preference are strongly driven by those with less than the median level of income. Ross is well positioned appealing to younger women who are heavy Department Store shoppers with a particular strength in the West.  Ross is particularly strong relative to other stores in terms of differentiation, which is the dimension for which below median consumers particularly rate Ross high, presumably attributable to the store’s low prices and treasure hunt concept.

• With steadily declining sales, JCPenney is currently anything but a success story. People are skeptical about JC Penny’s Differentiation, but they are willing to recommend the store to their friends.  It appeals to older men.  JCP still boasts a relatively strong RDE level, bolstered by a high Emotional connection level likely driven by the store’s long history as a retail giant.  However, consumers don’t get how JCP is different in today’s world as its stores are mainly located in declining mall areas, consumers are confused by the retailer’s changing pricing strategies and the company struggles to identify brand-defining elements to incorporate into its retail space.

• With the off-price segment being one of the few bright spots in the current retail landscape, sister brands TJ Maxx and Marshalls have also seen strong results.  With less extreme pricing than Ross, these stores perform substantially weaker among below median consumers on all RDE dimensions, while performing better than Ross among above median consumers.  TJ Maxx’s weakness is in the North East.

• With far fewer locations than the other brands included in the study, Nordstrom understandably lags in terms of Relevance.  However, Nordstrom is the only brand included in this study for which Differentiation is the strongest of the RDE elements.  This is likely due to such things as Nordstrom’s customer experience, its e-commerce leadership among major department stores and its successful off-price offering, “Nordstrom Rack”.

• The RDE composite shows a strong relationship to brand preference (r = +0.90).  In general, the off-price brands have somewhat lower brand preference than would be expected from the RDE level. This isn’t surprising given there is an established trade-off across categories between price and brand preference.

• Macy’s appeals to people who have a high education, employed with low incomes.