Private Label Today is a Lesson in Branding

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November 3, 2009

Store brands have the potential, and freedom, to leapfrog national brands in critical areas such as ingredients, flavors, preparations and even packaging because they lack the “baggage” that many national players carry, according to consumer research company and consultancy, Hartman Group, in it’s Heartbeat newsletter this week.

“Private label really is a story about today’s emerging brands cultivating a redefinition of quality and ‘reimagining’ their brands, retail experiences and categories within the larger driving force of this change, the Culture of Food.

The market has shifted from a traditional culture (which peaked in the ‘80s and saw the rise of retail, packaged foods and brands -— brands in this era were viewed as unique alternatives to homemade and carried great symbolic power) to a consumer culture.”

Consumers are redefining quality, which means that selling on status and brand image alone is insufficient, a focal point of the Hartman Group’s “Private Label 2010: Redefining Meaning of Brand” report.

“As the market shifted from a traditional to a consumer culture, the role of brands has shifted over time as well and the level of desirable qualities has gradually diminished as consumers’ expectations have evolved. A brand must be more than a consistently high quality product; a brand must now also be distinctive, well differentiated, experiential, authentic, specialized and relevant to consumers and shoppers within the context of their changing lives and lifestyles.”

Because consumers are smarter shoppers today and their choices are wide and deep, they are more carefully scrutinizing brands and their value. Hartman Group describes the new retail environment as “theatre rather than warehouse. This is where we see a dramatic paradigm shift happening as retailers have the upper hand in controlling quality perceptions and experiences, thus controlling brands,” Hartman Group wrote.

The research company’s 2006 research showed that 46 percent of consumers reported store brands were equal to or better than national brands, a perception that has improved over the past three years. “Retailers are in an upward trend in creating high quality products as well as ‘reimagining’ food experiences for consumers and shoppers.”

Indeed, the lines between private label and national brands are blurring. ”What’s interesting is not so much the fact that it’s happening, but that consumers don’t really care that they don’t know the difference,” Hartman Group wrote. “The importance of branding, and to some extent, the badge value of brands in the past, is quickly giving way to a greater emphasis on the product and overall experience controlled by the retailer!”

Read These Related Articles:

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• Nielsen: Look to Europe for the Future of U.S. Store Brands
• Mintel: U.S. Food Innovation Declines During the Recession
• Store Brands' Dollar Sales Rise, Unit Volume Declines

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