Challenges And Opportunities In Major Dutch Industries
Banking and retail are two of the most prominent categories in the BrandZ™ Dutch Top 30. Although they fared quite differently in this year’s rankings, both will remain crucial to the Netherlands’ economy in the decade to come.
Banks draw on core strengths in challenging times
Dutch banks declined by 16 percent overall in 2020, representing the largest category decline in this year’s rankings in total dollar value. Last year banks made up 20 percent of the total value of the Netherlands’ top brands; this year, their share fell to 17 percent.
In many ways, these declines should come as no surprise, as it’s been a challenging year for banks around the world. The total value of the global and European banking sectors also fell significantly in this year’s BrandZ™ analysis. In part, this result can be attributed to major macroeconomic issues like the U.S.-China trade conflict and Brexit, among other potential global recessionary trends.
But even in this context, a 16 percent decline for Dutch banks stands out as greater than those experienced by their counterparts in Italy, France, the UK, and Germany. This past year has undoubtedly seen a challenging climate for Dutch banks, as falling interest rates and a decline in mortgage lending – as well as court cases surrounding money laundering and other financial controls – have hurt their financial performance.
Despite the overall drop in value, however, the top Dutch banks still retain high scores for meaning and salience. This suggests that the condition of Dutch banks today is different than the situation in 2013 and 2014, when a financial collapse coincided with widespread loss of consumer trust in banks. In response to that earlier crisis, many Dutch banks pledged to become more “boring” and launched partially successful campaigns to win back the public’s favor.
One representative example for the banking sector is ING, which despite earnings challenges has stabilized its perceptions of Meaningful, Different, and Salience since 2013. ING has also strengthened its performance in the areas of Brand Purpose, Innovation, Communications, Brand Experience, and Love – the five aspects that make up the BrandZ™ metric for brand health and vitality, also known as vQ.
Strong brand health correlates highly with Meaningful Difference, and brands with high vQ scores are also more likely described as trustworthy, “in control,” desirable, creative, and friendly. They under-index on negative brand personality traits such as being uncaring or arrogant. On average, top banks in the Netherlands (i.e., those in this year’s BrandZ™ Dutch Top 30) actually improved their average performance in the vQ components of Love, Brand Experience, and Communications in 2020, and their Purpose scores also remained relatively strong compared to the global average for all brands analyzed by BrandZ™.
One area for improvement for Dutch banks is Innovation, where the category average hovers near 100 (which a “just ok” result). The case for boosting Innovation in the financial sector isn’t a merely statistical or theoretical one: in today’s challenging market, many Dutch banks are already betting that innovations like blockchain and fintech can help them to offset earnings challenges elsewhere in their business.
Dutch retail grows in prominence and value
The Netherlands’ retail sector, meanwhile, placed a leading seven brands in this year’s Dutch Top 30. It also notched the highest category growth rate, increasing by 53 percent over the previous year.
A big factor in this rise was the entry of two new retail brands to the Dutch Top 30: bol.com and Coolblue. And while both brands perform above average on measures of Meaningfulness and Difference, their divergent strategies point to some of the biggest trends in Dutch retail today.
Bol.com is a superb generalist retailer. Founded 20 years ago as an online bookseller, today bol.com is the Netherlands’ leading webshop across dozens of categories. The shop’s generalist ethos is emphasized by its tagline: “The store of us all,” a slogan that implies accessibility for everything and for everyone. In recent years, Bol.com’s decision to open up as a third-party platform for thousands of online stores has only further cemented it as a cornerstone of the Netherlands’ e-commerce universe, as has its recent experiments with two-hour delivery times.
Founded around the same time as bol.com, Coolblue has grown to become a service-minded specialist retailer in the areas of electronics and white goods. Their “go for it” friendly mentality is well-represented by the company’s slogan of “Anything for a smile.” Among its loyal fans, Coolblue is known for its focus on going above and beyond the standards of typical e-commerce customer service – for instance by offering free delivery, installation, testing, and recycling for its white goods products. Coolblue’s history as a niche retailer operating in just a few categories means that it still has room to grow its Salience scores (and attendant sales) in years to come.
Other attributes that set Dutch retail brands apart are exceptional value, smart design, innovation, and quirky personality. Home goods retailer Action, for instance, is the top riser in this years’ ranking. This is partly due to Action’s recent store expansion throughout Europe. But underlying Action’s expansion is consumer response to the brand’s low prices and high-quality products – as well as an innovative merchandising strategy that sees new products constantly rotating through Action’s stores, the better to encourage repeat customer visits. Other Dutch retail brands have distinguished themselves through quirky yet appealing product offerings (HEMA) and customer service philosophies (Jumbo), as well as a focus on innovation (for example, Albert Heijn’s delivery integration with corporate sibling bol.com) and a willingness to embrace new formats (SPAR).