Can brands still compete with the 5 Key Private Label Trends

by | Apr 1, 2019 | Branding with impact, Packaging Design, Strategically thinking through the design process

With the ever-increasing growth of Aldi eating into their market share, private label brands in Australian retail are counting on their own store brands to lead their future growth strategies.

With the advent of both Amazon and Kaufland entering into the market, private label has undergone an enormous upsurge in development and growth

5 Key Private Label Trends

When it comes to private label brands, Christopher Durham is an international thought leader on the topic. Durham is the author of six books on the subject of a private table, starting with Fifty2: The My Private Brand Project back in 2014.

Today Durham points to five critical developments in private label:

  1. Private brands are in the driver’s seat: It’s no longer just about retail organisations driving their private brands; it’s about private brands accelerating the retailers. According to Durham, retail companies are now embracing innovative brands that differentiate rather than merely copy national brand products.

  2. Competitors and shoppers raise the stakes: The entry of Costco, Aldi, Amazon.com and now Kaufland into the Australian FMCG market, as well as the rapid shifts in shopping preferences, are causing the major supermarkets to fully embrace innovative store brand strategies.

  3. Scale is no longer a limitation: Success today isn’t as much about the size of a retail organisation, as it is about the level of innovation. Whether it’s the world’s largest retailer or a disruptive online retail upstart, today’s organisations can develop innovative strategies that fit various scale requirements.

  4. Best practices are relevant across retail channels: Winning strategies are not specific to a retail channel like grocery or drug. They cut across retail channels. The key is to embrace creativity and stay on the front lines of rapidly shifting consumer demands. 

  5. Collaboration is essential to success: Building innovative private brands are becoming less transactional and requiring more retailer-supplier engagement. 

So what can both big and small brands alike do to counter attack this unprecedented increase in private label products appearing in every category on the retail shelf?

What’s to be done?

Today, driven by retailers perpetuation of their Owned Brands, big brands are recognising that to survive they have to use every tool at their disposal. This includes constant innovation and creation of highly engaging packaging design strategies to draw the retail shopper away from the Owned brands. 

Increased Private Label Demand 

The fact is that today’s consumers no longer shy away from buying private label products. One of the main motivators both today and in the past has been the need to stretch their dollar further. The other key driver pushing the barrow of the private label is quality. No longer are private label brands perceived as inferior. In fact, the sad truth is that on the retail shelves today, it’s often the private label packaging which is superior in design and outsells the more established brands.

study conducted by Field Agent found that 51% of Australian shoppers actually reported they preferred private label brands.

It is also interesting to note that over 1/3 of the shoppers surveyed estimated that 25% of their grocery list was made up of private label brands. Even more significant was that 1/3 of the respondents interviewed said that private label made up between 26%- 50% of their total purchases.

How do brands stay ahead of private label 

So what’s to be done? How do brands compete against the continued growth of private label brands? 

Strategic Re-invigoration 

Well one thing for sure, you can’t sit by and just watch as the retailers eat your lunch! 

The great news is that, because both trends and the FMCG market place changing so quickly, consumers shoppers are on constantly on the prowl for “what’s new”. 

As a brand marketer, on a budget, you have to have a predetermined evolutionary brand and packaging development strategy. You have to create a perception of regular “newness.”  

Skate to where the puck’s going

How do brands keep ahead of their private label and copy cat rivals?

Ice Hockey champion, Wayne Gretzky’s is often quoted, “Some people skate to where the puck is, I skate to where its going.” In FMCG terms this means creating and sticking to what we at Jam&Co call a Predetermined Evolutionary Brand and Packaging Development Strategy.

This is a brand and packaging development strategy mapped out over a 3- 5 year period. This strategic brand evolutionary plan stretches an evolutionary packaging design journey over time. This strategic campaign takes both your consumer and the retailer on the evolutionary brand and packaging development journey which not only retains the brands existing customers but also attract and appeals to a whole new market of consumers.

This plan also takes into account the way your product packaging will be presented and perceived in an online retail environment. The predetermined evolutionary brand and packaging development strategy forecasts how the brand and pack will look 2 years and 4 years from now. These predetermined changes and very often quick fixes can deliver short term revenue spikes and retain steady brand growth over time.

Ride the wave of change strategically 

Whilst, of course, it virtually impossible to predict the future, it is vitally important that Brand Marketers know and understand HOW the brand’s message will “ride the wave of change” but still retain relevancy in the market and on the retail shelf. This must be the case no matter how many of its brand cues are being copied.

Brand Marketers have to always stay one or two jumps ahead of their private label rivals. Also when one employs a sound “evolutionary journey map,” it makes change simple, proactive and seamless and avoids costly knee jerk packaging changes just to keep up. Redesigning your packaging re-actively is always costly and can often harm the brand.

Taking both the retailer and the consumer on the evolutionary journey

Retailers will also buy into the fact that your brand is not standing still. It will value the investment you are making in a three to five-year plan to grow the brand and appeal to a whole new market of consumers.

At Jam& Co we build change into the strategic evolving journey of the brand.  Contact us here at Jam&Co to see if this strategy will work for your brand and packaging design

CLICK HERE to see how we help your brand stay ahead of the private label and copy cat brands