In what is shaping up to be an ongoing conversation about Private Brand, Tom Pirovano, of The Shopper Wonk posted a response to his earlier top ten list on protecting your brand from store brand expansion. I then wrote a post responding to his top ten list with my own. The below article is his top 11 list for growing store brands. To which I will simply say Amen!
11 Tips for Retailers to Grow Their Store Brands
I recently shared some thoughts on how CPG manufacturers can protect their brands from private label expansion. It didn’t take long to hear back from retailers asking for tips on growing their own brands. Here are a few private label ideas for our retailer friends.
- Study the category consumer before going upscale.
Consumer understanding is the common thread among top-selling brands. It’s not enough for a retailer to roll out a quality product in premium packaging.
- Disguise your premium store brands.
Many consumers still associate private label with cheap knockoffs. There – I said it. But what if they don’t know it’s a store brand? Look to position premium store brands as exclusive products like Choxie at Target and Canopy at Walmart
- Get your pricing right.
The price gap between store brands and national brands varies significantly across categories. The same shopper who chooses private label bottled water for a 3% discount may require at least 20% savings for private label barbecue sauce.
- Offer multiple brands in multiple tiers.
Although Costco may be the exception, most retailers are finding growth with multiple store brands. No one brand can stand for value and gourmet and healthy eating.
- Eliminate weak links.
One bad product experience can hurt the entire store brand, not to mention the retail banner itself. Product quality needs to be consistent across each store brand. Your brand’s perceived quality is only as good as its weakest SKU.