An Inside Look at Loblaws New Black Label

Take a look at this fascinating article from the Canadian Business that details the creation and introduction of Loblaws new premium Private Brand Black Label. The new brand rounds out the traditional three-tier Private Brand structure with a unique premium twist, Presidents Choice spans the gap from traditional National Brand Equivalent products to Premium National Brand Equivalent products with Black Label occupying  a unique or Super Premium positioning. That is a big challenge

Super Premium/Unique – Black Label

NBE Premium – Presidents Choice
NBE – Presidents Choice

Basic – No Name Brand

An even better choice?
The butter-poached British Columbia prawns sit elegantly atop an argan-scented mushroom ravioli, nestled with an Ontario artichoke puree and bacon marmalade, topped with a toasted almond oil emulsion. Crafted by a renowned chef for an invite-only dinner, to describe how delicious this dish is would require words equal to Neruda on love or Kingsley Amis on a stiff drink. It’s an exotic collection of flavors that achieve a down-to-earth heavenly end. It’s like someone hired a masseuse for each individual taste bud. And it’s President’s Choice. Wait…what?

This is a stark departure from how most of us try a new supermarket product, wandering over to the lady in the hairnet and latex gloves to taste whatever’s in her plug-in skillet before we shuffle off to the milk aisle. Loblaws gathered a smattering of fooderati at the Neubacher Shor Contemporary Gallery in Toronto last month to officially launch its new “affordable luxury” line of President’s Choice products. Dubbed “black label” for its distinct package design (although those words won’t appear on the labels, thanks to a Johnnie Walker copyright) the new look items will range in price from $1.99 to $21.99. Landing in 140 stores this October, it includes more than 200 products ranging from an eight-year old cheddar and gingerspiced chocolate sauce to bacon marmalade. But even the stylish launch party can’t erase the memory of certain economic realities.

The Canadian grocery market is highly competitive, and with consumers evermore conscious of every dollar spent, Loblaws, Sobey’s, Walmart and more are continuously battling to lower prices to keep warm bodies in the store. In his second-quarter earnings call in July, in which the company’s food sales were flat, Loblaws executive chairman Galen Weston said, “Unpredictable and competitively intense market conditions continue to put retail sales at risk.”

According to the Nielsen Co., the house food brands created for retailers such as PC, Sobey’s Our Compliments or Walmart’s Great Value, also known as private labels, are an $11.4-billion annual market in Canada. It’s into this fray that Loblaws last year decided to develop and launch its own line of fine foods to win over consumers who might buy the bulk of their groceries at Loblaws then head off to a gourmet food store for a handful of indulgences. The idea is to make Loblaws a one-stop shop for food snobs, where they can pick up both toothpaste and truffle oil. But in this era of austerity, where private-label goods are considered a bang-for-your-buck value proposition, and where cheaper increasingly means better, can the mighty President’s Choice get people to pay for luxury? Will bacon marmalade be Loblaws’ next Decadent cookie, or is this gourmet gambit too risky a bet?

Inside, the gallery has been transformed into a high-class dinner party. Guests like Dragons’ Den star Arlene Dickinson and Sen. Pamela Wallin mingle around the eight set tables and back into the open kitchen. There, celebrated Toronto chefs like Marc Thuet, Bertrand Alépée and Anthony Walsh alternate between feverish prep work and idle chatter with curious passersby ahead of the impending four-course meal. Artisanal pastry chefs Bobbette & Belle (Allyson Meredith and Sarah Bell) also sit, cheerfully fielding questions while hand-painting edible plates made of sugar on which their dark Venezuelan chocolate cake with hazelnut mousse, cherry shiraz compote and roasted hazelnut ice cream will be served.

The chefs were invited to Loblaws headquarters to browse the new line and select items to be incorporated into tonight’s meal. Alépée, a generously bearded Paris-born talent known for his work at the late Toronto bistro Amuse-Bouche and now freelancing as the Tempered Chef, says it was tough to make a decision because of all the options. “It’s always nice to eat a refined product, and I just think it’s great that this kind of thing will be more accessible,” he says, taking a break from preparing the B.C. prawn dish.

Ian Gordon, vice-president of Loblaw Brands, says the new black-label line aims to fill a gap in the Loblaws offerings, adding the third tier to what many private-label producers refer to as a “good, better, best” portfolio of goods. There’s No Name, President’s Choice, of which Blue Menu is the healthier option, and now black label. “There is a 15% to 20% range at the top in the fine-foods area that we do not have an offering in for the consumer,” says Gordon. “It’s a niche we haven’t tried to talk to before now.”

Back at the dinner party, Loblaws product developer Jackie Hougham gazes down at her plate of cherry-laquered squab, with tatin of sunchoke, hickory foie gras and wilted umami greens—all featuring no less than six black-label products—clasps her hands together and let’s out a deep sigh of pride and relief. “These are my babies.”

Read the entire article: Canadian Business

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Christopher Durham
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.