This month’s edition of Brand Packaging magazine is devoted to store brands. It features the following article from My Private Brand president Christopher Durham.
Private Brand Designs Rich in History
George Huntington Hartford, Levi Strauss, Charles R. Walgreen, Sr., Rowland Hussey Macy, Sr., Aaron Montgomery Ward, Frank Winfield Woolworth, Caleb Bradham, The Brooks Brothers, Richard Warren Sears and Alvah Curtis Roebuck. The names read like a Who’s Who of American retailers. Along with their CPG contemporaries, they were entrepreneurs and innovators who created the template for today’s retail, and along the way they created private brand.
Not restricted to category or channel, they created brands that stretched well beyond the confines of grocery to include virtually every retail channel and category. They—and the brands their teams created—are the subject of my new book, “Vanguard Vintage Originals,” a photographic celebration of vintage private brand packaging. The coffee table book celebrates private brands and includes more than 150 photos by award-winning photographer Teri Campbell.
Private brand: the myth
The popular mythology of private label has its origins firmly entrenched in the recession of the 1970s, which began during the presidency of Richard Nixon and impacted the country well into the early years of the Reagan administration. The multiple energy crises of the ‘70s led to stagnant economic growth as oil prices surged. The combination of stagnant growth and price inflation during this era led to what was then called “stagflation.”
The American economy was the perfect petri dish for the emergence of generic products. The stark white or yellow labels with their plain, black san serif font screaming: CIGARETTES, BEER, SOUP were the perfect expression of America’s crisis of confidence.
Although the mythology certainly has a ring of truth, and generics were most certainly spawned by the economic crisis of the ‘70s, it’s far from the whole story. This was not simply an American story; it was global. The genesis of generic products is most often traced to France, which was also suffering from an economic crisis. In 1976, grocer Carrefour introduced its line of extreme value generics, simply known as Produits Libres.
The origins of private brands in the U.S. extend back more than 100 years earlier. Eight O’Clock Coffee was created by The Great Atlantic & Pacific Tea Company (A&P) in 1859; Craftsman Tools were introduced by Sears, Roebuck & Company in 1927; Walgreens began selling private brand products soon after its founding in 1901. In 1922, the retailer created the first malted milkshake, which led to Walgreens establishing private brand ice cream manufacturing plants.
The generics of the ‘70s were not the beginning of private brands, but they were inarguably the low point.
Private brands by the numbers
In 2016, private brands outperformed national brands in the rapidly growing mass merchandisers segment of Nielsen’s total outlet’s database, which includes national retailers such as Walmart and Target as well as warehouse clubs and dollar store chains. Private brand dollar volume in the mass merchandisers/club/dollar store segment climbed 4.4 percent to $49.6 billion. As a result, private brand’s market share moved up 0.6 of a point to 19.7%.