Take a look at this report from the Nightly Business Report (NBR) “The War Between Brand Names & Store Names” it positions the growth and evolution of Private Brands in the now clichéd role of “compare & save.”

The battle lines have been drawn over and over by the traditional media – the noble brand hero being taken advantage of by the value focused private label villain – the economy forcing downtrodden Americans in the villain’s lair.

It’s all silly really – Retailers are simply gaining branding expertise and understanding that the brands that they own are assets.

Perhaps someday the media will see the story in a different light. Ask different questions…

Do consumers really  know who owns brands and do they care?

Is it really better for a multinational conglomerate to own a brand than a mega-retail?

Is manufacturing an integral part of being a National Brand and if so how many National Brands actually manufacture what they market?

and of course…

What makes a National Brands and when do “Private Brands” become national brands? Distribution in thousands of stores is certainly a good start.

“The War Between Brand Names & Store Names”

When you go to the supermarket, do you tend to buy brand name items or the private label equivalents? A new study shows almost 40% of consumers have increased store brand purchases. As Erika Miller explains, price is only part of the reason.

Gharib: 
When you go into the supermarket or a drug store, do you tend to buy brand name items or the private label equivalents?  A new study shows almost 40 percent of consumers have increased their purchases of store brands in recent years.  But as Erika Miller explains, price is only part of the reason.

Miller:
Lillian Perez started buying Walgreens private label cookies to save money.

Lillian Perez:
I compared the ingredients and the fat content and I found that to be good to me.  And I bought it.

Miller:
But she keeps buying them, even when the national brand is on sale.  So, if they are the same price, which do you pick?

Perez:
I will pick the Walgreens, simply because I have been buying them.  That’s they way I am.

Miller:
It’s not just her.  According to Accenture, U.S. shoppers now fill at least half their carts with store brand products.  In fact, 28 percent of shoppers actually prefer them.  For its part, Walgreens credits a dramatic shift in its private label strategy.

Moe Alkemade, Vice President, Retail Brands & Global Sourcing, Walgreens: 
Store brands of five years and 10 years ago would never have this type of packaging.  The amount of time and effort that we put into quality packaging along with quality product, is so much different than it was before.

Miller:
Here’s something that may surprise you; once consumers find a store brand product that they like, they generally don’t switch back to the brand name, even if their financial situation improves.  And the more money a household earns, the more likely it is to buy the store brand.

Alkemade:
It’s actually households with a higher income that actually buy private brand a lot more.  So it’s really the smart choice and that’s what we call it.  It is now smart and in vogue to actually buy private brand.

Read the entire transcript

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Christopher Durham

President & Chief Strategist at My Private Brand/Folio28 LLC

Christopher Durham is the president and founding partner of the retail and Private Brand consultancy Folio28. He is a consultant, strategist and retailer with close to 20 years of real-world retail and corporate experience, creating, launching and building billion dollar Private Brands.

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