Lululemon and LCBO join Deloitte’s most ‘powerful’ retailers

The number of Canadian brands grew to eight, driven by innovation and sustainability.

Digital innovations and a new socially responsible consumer are the key drivers behind Deloitte’s latest 250 Global Powers of Retailing list, as two new Canadian brands, Lululemon and LCBO enter the list.

Entrants in the Deloitte report are ranked according to full-year 2020 retail revenue, so the list is topped by “The Big Three”: Walmart, Amazon and Costco.

Walmart’s U.S. ecommerce sales grew by 79%, as its investments in omnichannel and ecommerce innovation delivered results during the COVID-19 pandemic, and it launched multiple delivery and store pickup initiatives in the United States, Canada, Mexico and China.

The ranking also includes Canadian entries – eight in total, two more than last year.

Leading the way is the country’s big three grocers: Loblaw (ranked 25th, up six spots from the previous year with revenue growth of 10%), Empire (ranked 50th, up five spots from the previous year and with revenue growth of 6.3%) and Metro (ranked 79th, up five spots from the previous year and with revenue growth of 7.3%).

Rounding out the Canadian retail brands are Couche-Tard (88th), which is seeing strong growth in fresh food, Canadian Tire (109th), Save-On (201st) and new entrants LCBO (233rd) and Lululemon (239th).

For the LCBO, Deloitte cited how the provincial alcohol retailer answered demand during the pandemic with ecommerce and expanding same-day pickup options, offsetting declines in foot traffic.

Canadian athleisure retailer Lululemon was cited by Deloitte as a case study for both digital innovation and sustainability. The 25th fastest-growing retailer, with a retail revenue increase year-over-year of 10.6%, the company more than doubled its ecommerce business, contributing 52% of its total revenue. This helped to offset the 34% revenue decline in company-operated stores.

In August, as part of its social impact commitment, Lululemon partnered with Genomatica on a deal to create renewably-sourced, bio-based materials.

Deloitte cites retailer sustainability commitments like these as a bright spot. An accompanying survey found that 55% of consumers had purchased a sustainable product or service in the fall, and 32% also said that they paid significantly more for their sustainable purchase than the price of an alternative product. The largest category of sustainable purchases by respondents was food and beverages at 42%, followed by everyday household goods at 25%.

In line with the changing expectations of the Gen Z consumer, apparel retailer The Gap launched Gap Teen in FY2019, with clothes made using sustainable practices, that save water and reduce wastage.

Almost all the retailers in the Top 250 have outlined their environmental, social and governance (ESG) commitments and are publishing ESG-related metrics based on one or more of the ESG reporting standards. According to Deloitte, retailers are now considering the sustainability credentials of their products, as well as their overall brand, as a core part of their business strategy, in order to resonate with the concerns of an increasingly wide range of consumers.