Magazine article Marketing

OPINION: Marketing Society - Own-Brand Has Consolidated Its Place On-Shelf

Magazine article Marketing

OPINION: Marketing Society - Own-Brand Has Consolidated Its Place On-Shelf

Article excerpt

The fortunes of household-name multiple retailers have fluctuated recently, but this shouldn't blind marketers to the remarkably consistent success of that long-standing retailing phenomenon we call 'own-brand' or 'private label'.

In its early years, own-brand concentrated on FMCG products, entering the biggest markets first, and priced well below manufacturers' brands, of course.

Although own-brand quickly took a significant market share, it was mainly from secondary brands in each category. While brand leaders such as Heinz and Kellogg also lost share, strong, entrenched consumer franchises and sheer scale protected the bulk of their business, if not always their margins. The result was the continuing steady growth of own-brand, but over the years, a fairly stable situation.

However, the past decade has seen three huge developments in own-brand.

The first was the substantial brand equity accumulated by supermarkets.

Like Boots and Marks & Spencer before them, the superstores today command much the same loyalty and trust among consumers as the long-term manufacturer brand leaders.

From Addis' point of view, the most important development has been the infiltration of own-brand into non-food categories, competing in smaller markets, many not long out of the commodity zone. Here the leading brands - however successful - lack the massive marketing presence that buttressed the FMCG giants.

The latest development has been the multiples' recognition that they need no longer limit own-label to the bottom end of the price range. This has not yet happened in non-food markets such as kitchenware and cleaning products. …

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