The World's Top 10 Most Innovative Companies in Retail

No industry has been more transfigured in the past year than retail.

1. Warby Parker

For being the Warby Parker of Warby Parkers. It’s not just a company—it’s a category. As the eyewear maker opened four more brick-and-mortar stores, closed a $41.5 million round of funding, collaborated with the likes of the musician Beck, and expanded its staff to 300, it set the standard for merging online and real-world commerce while maximizing its cool. This inspired other e-commerce startups to explain themselves as “the Warby Parker of [fill in the blank]”—from Cory Vines (gym clothes) to True&Co (bras)—either as an easy shorthand or to just ape some of Warby’s glow. Read more >>

2. Amazon

For leaving its competitors in the dust. If Amazon was only pushing free two-day deliveries with its Prime membership—which grew by millions in 2013—it’d still have a leg up on the retail industry. But of course, it couldn’t stop there: Its grocery-delivery service, AmazonFresh, a Trojan Horse for hooking customers on same-day delivery habits, expanded to Los Angeles and San Francisco, while its partnership with the U.S. Postal Service brought—gasp!—orders to your doorstep on Sundays. Sizable profits for Amazon might be as far away as its promise of 30-minute drone delivery, but one thing is certain: Its competitors have miles to go if they hope to catch up. Read more >>

3. The Legaspi Company

For rebuilding malls to meet cultural needs. By understanding Latino customs, the Legaspi Co. is revitalizing a dying bastion of American commerce: shopping malls. Advertising exec turned developer José Legaspi has resurrected 10 failing properties by turning them into Hispanic cultural centers, incorporating religious offerings in stores, and providing spaces for families to congregate. Legaspi’s methods have led to a 30% increase in income and foot traffic across its 70 locations in the southwest and southern United States. Read more >>

4. J.Crew

For meticulously cultivating its brand to become the world’s iconic American clothier. J.Crew’s quintessentially American aesthetic—which flawlessly melds runway-worthy design with middle-class value—went east last year, with the company opening its first stores outside the United States. Its overseas march began with a 17,000-sqaure-foot location on historic Regent Street in London, and the outfitter reportedly has its eyes set on Hong Kong, Japan, and Australia. The global expansion comes on the heels of a 10% revenue increase in 2013, which many would credit to the revered partnership of CEO Mickey Drexler and Jenna Lyons, president and creative director.

5. Walmart

For deploying smart mobile solutions to aid its customers. According to Walmart, its app-wielding customers make twice the shopping trips per month and spend 40% more than non-app users. That’s a clear sign that the retail giant’s efforts to use mobile to improve its business in the digital age is working. Just a couple of innovations from its WalmartLabs include the ability to guide customers (via GPS) directly to products in its cavernous stores, and even let them skip the checkout line and scan and pay for items with their smartphones. Its stores aren’t Amazon-proof yet, but they’re getting there.

6. eBay

For expanding its business model to become retailers’ best friend. In keeping pace with the revved-up world of e-commerce, eBay’s ambitious hyperlocal push has allowed it (and its retail partners) to remain plausible shopping options for consumers spoiled on convenience. Its one-hour delivery program, eBay Now, expanded to metropolises like New York, Chicago, and Dallas, while the company looked abroad (and even to the cosmos) for growth. It recently teamed with U.K.-based store Argos to let users pick up online purchases in stores, and last summer it announced PayPal Galactic, its plan to allow people to buy things from space.

7. Burberry

For upholding its legacy of impeccable design while catering to the digital millennial. While the style of Burberry’s classic trench won’t change, the people wearing it have—and the London fashion house has dedicated itself to changing with them. Its retail stores put the brand’s tech-friendliness on display with mirrors that interact with products via RFID chips. And when Burberry wanted to shoot a runway show with a set of not-yet-released iPhone 5s, Apple—at the time, Burberry CEO Angela Ahrendts’s soon-to-be employer—readily handed them over. Besides bridging the gap between classic fashion and innovative retail, Burberry has also found new life in Asia, as revenue soared 14% in the region (thanks, in part, to a newly constructed outpost in China).

8. Zady

For selling radical transparency as the new black. Soraya Darabi and Maxine Bédat scour trade shows to populate Zady, which tells shoppers where in the world their clothes are made, along with background information on who makes them. The company, launched in August 2013, highlights and sells items from smaller brands, such as fine leather goods from Detroit-based Karmo Studio, to larger ones, such as New York–based clothier Steven Alan. Each item featured on Zady is ethically sourced and manufactured, and almost all of the respective companies call the United States home.

9. Farfetch

For creating a one-stop shop for browsing high-end boutiques around the globe. Farfetch’s site is almost like a retail portal to the rest of the world: Customers can shop the streets of Milan or New York, all from the comfort of their own home. The London-based site, which offers products from more than 300 boutiques in 24 countries, nabbed a $20 million boost in funding last year—led by fashion-bible publisher Condé Nast—to further expand its reach in 2014.

10. Macy's

For mainstreaming the notion of everywhere retail. In what it preached as “omnichannel” retail, Macy’s spent the better part of 2013 completely transforming its supply chain—making an impressive 500 stores perform double duty as fulfillment centers—to ensure customers could order and receive products from any store location, in any variety, and, when possible, on the same day. At last count, 10% of online sales are fulfilled from Macy’s stores.

Editor's Note: In a previous version of the Burberry entry, Angela Ahrendts was identified as the former CEO of Burberry. She has not yet left the company.

[Image courtesy of Zady]

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26 Comments

  • Darcy Santala

    Lots of small businesses are starting to see amazing returns selling via non-traditional avenues such as the various social media outlets like Facebook & Instagram, for example Haute Mommies and Bella Babies has a B&M store, a website and a fb fan page with 25k+ fans that it uses to sell merchandise: https://www.facebook.com/HauteMommiesandBellaBabies this is the type of innovation that will enable small business to succeed.

  • Warby Parker deserves the top spot--I love how they reinvented how people buy glasses. I'm a bit surprised that Target and Nordstrom didn't make it to the list though. Target has been using mobile and social really well. Same with Nordstrom. And I've seen them do some pretty cool stuff in their Innovation Lab as well.

  • Farfetch has changed online retailing. Designers who had only been seen in exclusive boutiques now have a global presence. It's opened a lot of doors for a lot of people.

  • "According to Walmart, its app-wielding customers make twice the shopping trips per month and spend 40% more than non-app users. That’s a clear sign that the retail giant’s efforts to use mobile to improve its business in the digital age is working."

    Common confusion between causation and correlation here. Those who are willing to download the app are by definition a more engaged sub-set of their customers. I'm curious to see if it had any impact on their behaviour following the download.

  • Malcolm Fisher

    J.crew needs to start treating there existing store employees right before they think about opening more stores, they're paying us scraps.

  • Cool article but #4 seems kinda weak. Jcrew opening a few stores overseas is "innovation"? Not sure this is on the same playing field as Amazon same day delivery drones.

  • Wish small businesses would take the time to learn from these giants and replicate they're dedication to customer service and efficiencies. it is so critically important to take time to reset and understand your platform and what are the values of your business.

  • Bhagyalaxmi Dash

    Clicking on PayPal Galactic is loading an Amazon page. ???

    Please correct the URL behind PayPal Galactic. We take these things seriously at PayPal.

    Thanks.

  • Andrew Boon

    Interesting article. Innovations such as this will help retailers boost their sales, improve shopping experience and stay in the business longer. I work for McGladrey and there is a whitepaper on our website that aligns well with this article, it talks about the future of retail and what retailers can do to grow in a post recessionary economy, readers will find it interesting. @ " Post recession strategies for retailers" http://bit.ly/18Skei5

  • Andreas Loroch

    You shouldn't forget the very successful German DM-Markt Retailer with their innovative people strategy since you are talking about the world.

  • Courtney McCarroll

    Amazon uses predatory and unfair business practices to virtually wipe out its competitors. I don't call that innovative at all.

  • Martha Lightcap

    I try not to buy from them, but sometimes the savings on a particular item are so great it is worth it. I'm not a big consumer anyway. Shopping is not in my genes anymore. I have enough stuff.