AdAge Save-A-Lot

Innovative Private Brand Promotions Impact Growth

\"\"Innovative Private Brand promotions seem to have become a rather regular occurrence in the local and national news as well as numerous trade magazines. This past week Advertising Age featured one such article on a promotion by Save-a Lot. This is a great promotion that samples Private brand, builds loyalty and challenges the status quo of old school media. Nice Work

Save-a-Lot Stretches Media Budget by Delivering Free Groceries

Test Run in Louisiana Town Likely First of Many

Damn the newspaper ads and the circulars. The Save-a-Lot supermarket is engendering some good will and great buzz with a simple, but effective, promotional campaign to announce its presence in one community in the South — free groceries delivered to your home.

In a test-run case in Opelousas, La., a small town an hour west of Baton Rouge, the chain supermarket today delivered a bag of free food and other staples, unannounced, to about 1,000 homes within a one to one-and-a-half mile area surrounding the store.

Recipients have taken to social media to trumpet the news. One man wrote on Facebook: \”Dearest neighbors … come home for lunch! It seems there are free groceries being delivered by Save-a-Lot to your door steps.\”

Mark Kotcher, director of brand marketing and design for Save-a-Lot, a St. Louis-based subsidiary of Supervalu, said the company wanted to do something different to reach out to the community.

\”We\’re always looking for new ways to break through,\” Mr. Kotcher said. \”A lot of grocery advertising today is people saying \’Our prices are the lowest, our prices are the lowest.\’ Well, we believe in proof points and what better way than to take it right to [the customer\’s] front door?\”

The bags are filled with about $10 to $20 worth of groceries. Mr. Kotcher said the items are mostly household staples that resonate with buyers, such as three-for-a-dollar macaroni and cheese. All of the items are also strictly Save-a-Lot\’s own brands, which he said are typically 30% to 40% lower than name brands.

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Is the Party Ending for National Brands?

An intriguing article from advertising trade magazine stalwart Adage who continues to be hopeful for the reemergence of now faded national brands and their corresponding ad spend. Perhaps the emergence of retailers as brands and the corresponding support of the brands they own, Private Brands will change their tune.

\"\"Is the Party Ending for Private-Label Package Goods?

Private-label shares have leveled off after a 1.1 percentage-point gain last year and a gain of more than 2 percentage points since late 2007, according to Nielsen data from Sanford C. Bernstein, the biggest one-year jump in decades. Indeed, in household and personal care, which had been seeing private-label gains faster than food, store-brand shares have been essentially flat since September and are down 0.3 percentage points from October.

That\’s the good news for brand marketers. The bad news is, so far, they\’re largely staving off private label by reducing price gaps. That comes from a combination of the brand marketers cutting prices and private labels raising them as they catch up with hikes the branded players took a year or more ago, according to reports by Bernstein and Consumer Edge.

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National Brands on the Run, Announce Aggressive Defensive Ad Spends

Late last week Ad-age published the following article detailing the increase in ad spending that CPG’s plan in the next year to combat Private Brands. As the Private Brand story continues to evolve it becomes increasingly clear that Private Brands are becoming “real” brands and that the “real” brands are treating them as the significant competitors they have become.

Image via Wikipedia

Package-Goods Marketers Vow to Boost Spending
To Fend Off Private Label, Kraft, P&G, General Mills Plan to Increase Investments in Advertising, In-Store, Coupons

Consumer package-goods companies found a rare point of agreement at the Consumer Analyst Group of New York conference this week: the need for continued increases in marketing support. Marketers battling private label from Kraft to Procter & Gamble and General Mills promised bigger investments in advertising, in-store promotion, shelf signage, coupons and packaging.

Hershey and Heinz, which have lagged the package-food industry in marketing spending, are racing to bridge the gap. Heinz CEO William R. Johnson noted \”the industry\’s renewed focus on innovation and marketing in response to the challenge of store brands.\”

\”Nothing like the thought of hanging to concentrate the mind,\” he quipped. Heinz increased marketing spending by 40% for the most recent quarter. Overall, Mr. Johnson said Heinz\’s marketing has increased by 60% over the last four years. He added that Heinz has significantly increased its coupon program in the U.S. and U.K. as consumers are redeeming them more. These investments aren\’t included in the marketing budget.

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Retailers Wage War on National Brands!

This much written about war between national brands and Private Brands continues to draw much attention form the press, and according to this article from Ad Age continues to escalate. National brand marketers shout the end of retailers who go to far and Private Brand manufacturers take every sku they can get meanwhile only time will tell how this war will conclude or if it is a war consumers care about.

\"CVSFrom CVS to Costco, Retailers Put the Screws to Brands
Coke, Energizer Ditched in Price Fight, CVS Bills to Make Up Profit Deficit

Marketers are facing the litmus test of whether their brands truly are indispensable as retailers show a growing willingness to boot even major, well-advertised brands to improve leverage, margins and lower prices.

Costco\’s recent decision to strip Coca-Cola products from its shelves in a pricing dispute is the highest-profile sign yet that the age-old battle between marketer and retailer is escalating, due to the growing power of private label, looming package-goods deflation in the face of falling commodity prices, rising pressure on retailer margins, and softening volumes. Facing those factors and armed with data from loyalty cards, retailers are getting savvier about which brands to keep and which to lose.

CVS/Caremark plans to remove most Energizer alkaline batteries from its stores by early next year, according to Deutsche Bank analyst Bill Schmitz, leaving just Duracell and private label. And Walmart, which stepped up efforts to pare brands from its shelves this year, will reduce assortments even more aggressively next year, according to manufacturers and analysts.

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AdAge Walmart

Great Value – \”America\’s Hottest Brand\”


Over the last couple of years the traditional trade magazines have approached Private Brands with skepticism and a bit of elitism. Private Brands are not real brands has been the traditional wisdom. Plus what publisher in his or her right mind wants to alienate the CPG’s that have driven the ad business and more importantly bought ads in these magazines.

So it is particularly interesting to see Walmarts Great Value included in this article form Advertising Age as one of “America’s Hottest Brands.” According to the article: Advertising Age Honors the Top Brands of the Year — and the Brains Behind Them. The inclusion in this list places Great Value alongside some of serious “Real” brands including: Panera Bread, Barnes & Noble, Bing, Cover Girl, Digorno, Jet Blue and Mountain Dew just to name a few.

Walmart Great Value: an America\’s Hottest Brands Case Study

Private label was always a big business, but never a big priority for Walmart. Clearly it\’s become bigger in both regards under Andrea Thomas.

Ms. Thomas, 45, has led the massive re-stage of what Walmart rightly bills as America\’s largest package-goods brand, Great Value, with sales estimated around $10 billion. It\’s easily bigger than all of Hershey Foods, Ms. Thomas\’ last stop, where she was VP-global chocolate.

Walmart doesn\’t release numbers for the brand. But the re-staging of Great Value has had a substantial impact since it began rolling out in April — be it from the stores, where the stark white packaging has made the brand far more obvious, to third-party numbers.

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