Thursday, September 01, 2005

RETAIL PRIVATE LABELS.. will they take over Big Brands

Walmart - EQUATE (Health and Beauty)
Shopper Stop - STOP, Kashish, LIFE and Vettorio Frattini

Stats: 80% of Shoppers' Stop's revenues are generated selling these brands and the remaining 20% through Shoppers' Stop-owned private labels.

These private labels can be divided into a number of groups:
Store brands: This is where the retailers name is very evident on the packaging
Store Sub-brands: Products where the retailers name is low-key on the packaging.
Umbrella branding: A generic brand independent from the name of the retailers name. Umbrella brands are used in different product categories.
Individual brands: Name used in one category, this is only used to promote a ‘real’ discount product line.
Exclusive brands: Again a name used in one category, but to promote ‘added value’ products within the category.

Overall private labels are used to provide products with a lower price. In Europe, these prices can be 10-18% cheaper, whilst in the USA some private label products are 25% cheaper than the brand leader.

What is the future for private labels?
Private labelling will continue to grow and in Europe especially, will become international. Discount stores will develop their own private labels at the expense of brand labelled products.

Apart from price driven private labels, the upmarket label will develop. This has already been achieved in the UK with Sainsbury’s wines and Marks & Spencer sandwiches. The private label will continue to compete with brand leaders. The warning is if you have a branded product that is not a market leader then your product could be seriously under threat in the next few years.

For more details visit: http://retailindustry.about.com/library/uc/02/uc_stanley2.htm

The private label leaders
Aldi: 95% private label
Lidl: 80% private label
Sainsburys: 60% private label
Tesco’s: 40% private label
Wal-Mart: 40% private label
Carrefour: 33% private label

Who will win - Private Labels / Established Brands?
Are there any success stories of private labels?

2 Comments:

Blogger Nitin Kochhar said...

Both will exist !!

September 03, 2005 4:48 PM  
Anonymous Anonymous said...

Where did you find it? Interesting read » » »

February 17, 2007 10:52 AM  

Post a Comment

<< Home