Magazine article Marketing

Commodity Brands: Make a Name for Yourself

Magazine article Marketing

Commodity Brands: Make a Name for Yourself

Article excerpt

Evian has made its fortune from selling people the most abundant resource on earth. Are other commodities as readily brandable, asks Jane Simms.

Gordon Ramsay and Delia Smith may be able to wax lyrical on the finer points of potato varieties, but does the issue hold the same resonance for consumers? Premier Foods business unit MBM Produce certainly thinks so. Earlier this year, it announced it was to launch Potato Lovers, claiming it will be the UK's first fresh-potato brand; a decision that caused a few eyebrows to be raised at the risk associated with the strategy.

MBM, one of the three biggest suppliers of potatoes to UK supermarkets, has invested heavily in developing varieties and building the brand from scratch. Whether it can persuade consumers to pay more for a product traditionally regarded as a largely undifferentiated commodity remains to be seen.

'Potato Lovers is about delivering the right potato for the right purpose at the right time of year,' says Eddie Stableford, managing director of brand design and marketing consultancy Bryt, which created the brand for MBM following research revealing consumer ignorance about potato varieties.

'At one focus group we had a woman in tears over the variable quality of her roast potatoes,' he adds. 'It was not her culinary skills that were at fault, but the fact that most potatoes are marketed as 'general purpose'.'

Potato Lovers' potatoes are sold by variety, but the key difference is that they are marketed by function; its winter range offers potatoes for baking, chipping, mashing and roasting. While acknowledging the demand from some consumers for more niche products, Stableford says the purpose of Potato Lovers is 'to deliver fantastic-tasting potatoes for common use, not to introduce rare varieties'.

Most commodity suppliers are working to develop brands to escape the rising pressure on margins from the big supermarkets. 'Suppliers in every commodity sector have to do something to get their margins up or they will disappear,' says John Wringe, chief executive of branding network Star Chamber. 'Once the retailers have squeezed as much margin as they can out of their UK suppliers, they will shift their sourcing abroad.' Developing brand propositions is the easy part, he explains, but getting the right distribution, margin and communications in place, to get consumers to buy the product, is a lot more difficult.

Outgrowing the market

There are some successful precedents in the branding of commodities.

Florette, the UK's top-selling prepared salad brand, is one example. 'We are the only known brand in our sector and the only packed salad that advertises the product,' says Florette managing director Mark Newton.

Florette has used advertising regularly since its launch in the UK 15 years ago, and last year became launched a TV advertising campaign. As a result, its sales grew 17% last year, compared with 3% across the sector as a whole.

Cravendale milk is another example. Launched eight years ago by Arla Foods into a commodity-driven, own-label market, the brand's point of difference was its fresher, cleaner taste, and the longer life imparted by a filtration process that removes the bacteria that cause milk to go sour. Unopened, it lasts 20 days, compared with 14 for standard milk.

Marketed as 'the freshest-tasting milk you can buy', Cravendale's core market is women with children. Despite a typical retail price that is 18p higher for two litres than standard milk, the brand has posted double-digit sales growth since launch and is now worth about pounds 63m. In October it expanded the range with Cravendale Hint Of, which offers additive- and preservative-free strawberry and vanilla variants, priced pounds 1.09 a litre.

Arla plans to continue to invest heavily in the brand, not only to promote its benefits and justify its price, but also to counter the challenge from the supermarkets, which are developing own-label versions. …

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