Research: Empowerment, Not Price Drive Private Label Sales

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November 29, 2011

A new report from Planet Retail shows how consumers are driving new products innovation and determining store brands success.

Private Label Trends 2012, looks at six key trends expected to shape the private label industry next year and beyond. At the top of the list is customer endorsement.

“Today’s empowered consumer wants to be involved in the decision-making process, whether that is simply providing feedback or suggesting entirely new product lines,” said Global Research Director Natalie Berg. “Getting customers to endorse your products not only instills trust but, crucially, it ensures high quality standards for private label items.”

Although this trend is still in its infancy and predominantly taking place in Europe, Planet Retail said there is a huge opportunity for retailers in North America. The report points to retailers such as Walmart’s Asda, Carrefour, Loblaw and Migros as prime examples utilizing customer endorsement.

In what the report calls “the largest private label relaunch in U.K. history,” Asda rebranded its Chosen by You line after conducting 200,000 blind taste tests with 40,000 consumers. Carrefour set up test panels from 15,000 households in Europe for its new label while Canadian retailer Loblaw partnered with a TV station for a reality cooking show, “Recipes to Riches” to create new products for the Presidents Choice brand. Swiss retailer Migros introduced a take-off of on Wikipedia with its own Migipedia website as a test laboratory for new products.

Customer involvement lets retailers continuously track changing shopper demands and ensure continued product quality based on feedback. Additionally, grocers have been able to launch all-new product lines and nearly all-global food players are extending their private label offerings, according to the report, which was sponsored by Daymon Worldwide.

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