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Private label-icing-on-cake


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Retailing for every moment conversion
- by Shining Consulting

Published in: Business, Health & Medicine
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Private label-icing-on-cake

  1. 1. W H I T E P A P E R Retailing for every moment conversion It has historically been proved that the biggest source of income and profitability in the retail business is private label. Shombit Sengupta01 ©Shining Consulting: +91-80-4127 6999
  2. 2. Shoppers there have been educated to expectOrganized retail in developed multiple category products in the retail with onlycountries has, in the last a few brands. As it’s difficult to advertise the30 years, strategized to numerous private label products, their first priority is to make private label into totally self sellingadd value to shoppers by objects on the shelf.providing private label The products should implicitly connect to shoppers with a high balance of cost, quality andproducts at 20 to 30% lower aspiration while being of lower price than anyprice than national brands. national brand. Cost Quality Aspiration There are 4 schools of 2. Retail brand transcended to thought regarding private private label while segmenting label branding that’s been the basic, mid and high category implemented and has products with sub category shown results: branding, eg. Tesco 1. Retail brand transcended to 3. Retail brand transcends to all private label for basic category categories, eg. Walmart products, eg. Carrefour. A few other 4. Private label kept totally isolated brands address premium or high from the retail brand, value category products. eg. Intermarche in France In the 1970s and 1980s, a few retails created private label brands in every category to look like national brands. Without proper communication these were considered fake and could not succeed.That’s why this chapter is totally buried, it cannot come back.02 ©Shining Consulting: +91-80-4127 6999
  3. 3. Cross category brand There will always be two types of architecture in private label: Basic and category differentiation.architecture for private label The main attraction to be created here is theThe 4 ways of handling private label that tangible benefit the shopper can intercept at thereciprocate success is mentioned in 1 to 4 above. moment of purchase.A large number of categories can easily be fixedunder one brand, but a minimum of 3 layers It’s best to avoid copying any nationalhas to be created for the generic level product, brand as it confuses the shopper at thebranded category product and the exclusive store. Doing so would make the privatebranded category product. label appear like a counterfeit brand.Ideally the 3 levels should have their own very A retail brand has the responsibility ofdistinctive structural packaging as the illustarative protecting shopper value.architecture shows below. Category differentiation architecture Premium price category Premium category Line extension architecture architecture category Master branded category High focused extension 1 Line area Category differentiation architecture Mid price category Average Processed Transgress Line extension architecture architecture extension 1 category Line Master Category differentiation architectureGeneric level product Line extension category architecture Master architecture BASIC extension 1 Line03 ©Shining Consulting: +91-80-4127 6999
  4. 4. The retail has to A private label brand cannot besimultaneously invite stretched as much as you want, it’sshoppers for the store’s usage depends on the type of store.multiple choice of national High competence categories suchor regional brands, as well as electronics, telecommunication,as its private label as the durable appliances, jewellery, fashionshopper’s alternative choice, accessories need to have differentof course not counterfeit private labels in the same store.choice. But a lot hinges on the store’s image. In theShining example of low price to high price case of Harrod’s in London, any productfood category private label for Reliance Fresh that gets the Harrod’s stamp receives its authenticity and high premium value.A manufacturing company’s But private label is captive sales only.Privatebrand is highly focused label can apply an ingenious extendible architecture differentiating among a range ofon the category, and the categories, quality levels, and variety inside eachmanufacturer can choose a category.distribution system for where This allows private label to control numerous,he wants to sell his products. quality driven products with discipline and04 ©Shining Consulting: +91-80-4127 6999
  5. 5. flexibility for easy understanding so as tocreate an impact of being the high aspirationalalternative to national brands.Three examples of private label strategy andexecution by Shining Consulting Private label Via driving the cosmetic category for Intermarche in FrancePrivate label at Reliance Fresh stores categorizesdifferent hierarchy of products from base to Retail brand Monoprix extended as private label across categoriespremium value ally Branding is tot different for a © Copyright of all logos and images belong to the respective Cos. manufacturing company and private label. Shining Consulting Pvt., Ltd. 17, Visveswariya Industrial Area, Tel : 91-80-4127 6999 / 81 Mahadevapura 2nd Stage, Fax : 91-80-4127 6990 Bengaluru - 560 048, India. Email: www.shiningconsulting.com05 ©Shining Consulting: +91-80-4127 6999