November 16, 2009
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| John Failla, founder of Store Brands Decisions, moderates the packaging and design roundtable. |
Store brand design and packaging is growing in importance as many retailers expand beyond national-brand-equivalent products and look toward developing premium products that are better than national brands.
This new focus and strategic direction is filled with opportunity, but also presents many challenges to retailers and suppliers, according to industry experts who joined Store Brands Decisions for its roundtable Monday at the PLMA Show titled “Creativity in Store Brands.”
The bottom line is premium store brands drive higher transaction sizes and higher profit potential, according to Michael Kitz, vice president of Office Max. “Retailers are finally recognizing the power of their brands and that they can create an emotional connection with consumers with their products, packaging and design.”
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| Maria Dubuc and Michael Kitz |
Kitz was one of seven roundtable participants, which also included Doug Palmer, vice president of own brands for A&P; Wendy Sallak, vice president of creative services for Topco; Andy Johnson, strategic partner for united* dsn; Rob Wallace, managing partner of Wallace Church; Maria Dubuc, creative director for Marketing by Design; and Susan Steinberg, vice president ofAisle 9.
Below are key take-aways and sound bites from the roundtable, which will be covered in more detail by Store Brands Decisions in the coming weeks.
• The future: “In a lot of categories you only need one brand and retailers are starting to wake up and are realizing they can create No. 1 brands in their markets,” said Palmer. “When we get there you will see a tsunami of branding in the marketplace. Then we’re not just talking about profit increases, but profit replacement. Why do I then need three or four national brands?”
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| Rob Wallace |
• Owning the retail space: “Retailers are brand mavericks who control the retail environment, which allows them to test products more easily and more quickly,” said Wallace. “Retailers have cheap and irrefutably accurate testing grounds that CPG companies can only wish they had.”
• Vision from the top: “Our leadership had a vision and if we get off track he would pull us back on track and keep us focused on the end game,” Kitz said. “Let’s face it, we’re all doing this to make more money for our companies.”
• Strategy first: “Retailers have to have a well thought out strategy and be able to communicate it through their company and to their designers,” said Dubuc. Johnson added that bringing the vision alive “is really a transparent and honest partnership between the retailer and the brand/design team.”
• Biggest retail packaging mistakes: “Slapping a store logo on a me-to product without developing the branding, positioning, graphics and design,” said Steinberg. For Johnson, the biggest error is giving in to the “chronic desire to imitate; don’t imitate, but learn from others.” Topco’s Sallak cringes when she sees “your logo here” packaging come-ons, “which are hard for retailers with low budgets to walk away from. Retailers want new design but they often do not want to pay for it,” she said, adding “investment is necessary.”