Why Private Brands Fail?

failureMost brands fail. In fact, some estimate that 70-80% of new brands launched each year flounder and eventually flop. But do Private Brands fail? Do they follow the same sobering failure rate as other brands? Is it even possible for them to fail?

Private Brands fail differently than manufacturer brands. And because of this, tracking failure isn’t as obvious. Failure is not a word often used in reference to Private Brands, and yet there are clear ways retailer owned brands can fail in the today’s marketplace. To become better brand builders, launchers and managers, we must become students of why Private Brands fail.

For years, retailers leveraged their brands more as category fillers then strategic differentiators. They were given shelf space to provide more (and usually cheaper) choice to shoppers. Yet today’s marketplace has shifted. While Private Brands may not have to fight for space, they definitely have to fight for shoppers. And it is in the fight for the shopper where they succeed – and fail.

So, why do Private Brands fail? Let’s not focus on their ability to get to shelf, instead let’s focus on their inability to get off shelf. There are two strategic cracks that tend to run through most failures.

Information, not Insights
Information is easy to find. Observations are easy to make. Yet it is insights that are the lifeblood of success. Private Brands must be able to find, understand and leverage insights like never before, using them to influence what and how they go to market. In this age of choice, you can no longer afford to fake innovation – your brand must be able to clearly have a reason for being.

Appealing equity or pretty packaging doesn’t mean a sound strategy. Nor does it cover up the lack of a strategy. Private Brand packaging is on the up and up – anyone who reads this blog can clearly see this. And yet it is the insights behind the strategy that guide the product and packaging that will ultimately determine success or failure.

Different, Not Differentiated
Retail shelves are full of brand parrots attempting to mimic and replicate what once proved to be successful. But putting a clever twist on what has been done before doesn’t mean it will work again. If you lack the insights that influence development, you will lack differentiation at launch.

Different is not enough, you must determine what you can bring that is unique. What’s your new angle? And your answer better not end with –er! At the shelf, where success ultimately plays out, a clear differentiation translates to a clear reason to buy.

So, how should this influence what you are delivering today and developing tomorrow? Learn from failures, both personally and organizationally. Have the courage to question foundational elements, even after development has begun. And always start with the shopper, because that is where success ends.

Jared Meisel-squareJared Meisel
Managing Partner, Shopper Marketing – Theory House
Before launching Theory House, Jared worked at some of North America’s biggest shopper marketing agencies, including DraftFCB and Saatchi & Saatchi X. A seasoned marketer and brand strategist, Jared is responsible for helping clients connect with their audience in relevant, profitable ways. His deep understanding of the retail space and consumer behavior helps partners navigate and leverage the rapidly evolving world of marketing.

Jared and his wife, Rachel, have two young boys. Though he grew up overseas and has lived all over the U.S., Jared has a southern heart and is proud to now call Charlotte home.

 

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