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Cover Story                    PL 4TH QUARTER OUTLOOKBY JOHN N. FRANK                                    White is everywhe...
PL 4TH QUARTER OUTLOOK                            Cover StoryW              hen it comes to              private label    ...
Cover Story                          PL 4TH QUARTER OUTLOOKIs white being over-used in private label packaging today? Some...
PL 4TH QUARTER OUTLOOK                                        Cover Story                                      advisory bo...
Cover Story                        PL 4TH QUARTER OUTLOOKsavings in the 0.5 to 1.5 percent       is reaching out through s...
PL 4TH QUARTER OUTLOOK                                 Cover Story                                                        ...
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Is Everything All White - Private Label Buyer Cover Story


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August 2011 Issue of Private Label Buyer
Patrick Rodmell weighs in on Private Label Buyer Article

Published in: Design, Business, Lifestyle
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Is Everything All White - Private Label Buyer Cover Story

  1. 1. Cover Story PL 4TH QUARTER OUTLOOKBY JOHN N. FRANK White is everywhere on private label packaging today, is that a good thing? Maybe not, say some experts. Read why not, and also read what other trends are impacting private label as 2011 enters its final quarter.16 PLBUYER A U GU S T 2 0 11 WWW.PRIVATELABELBUYER.COM
  2. 2. PL 4TH QUARTER OUTLOOK Cover StoryW hen it comes to private label packaging, white isthe new white. White is also thenew black, and the new yellow.In short, white is everywhere onnew private label packages. Retailer after retailer hasbeen rolling out new lines andnew products in packagingthat is either all white,predominately white or includeswhite accent areas. The trendhas become so pronounced thatsome are concerned privatelabel may be entering a new A 2011generic era, a time when allprivate label packaging is sosimilar that consumers feel no PL SCORECARDparticular brand affinity for oneretailer’s offering compared PL WINNERS PL LOSERS THE JURY ISwith how they feel aboutnational brands. Kroger Walmart Not clear where PL fits STILL OUT Knows how to execute in-store Supervalu Not only packaging, but in its retail strategy Will Essential Everydaynaming of new private label Safeway Fresh & Easy succeed?is echoing a certain sameness Good product concepts Its problems are biggeras well, adds one industry Target Family Dollar than private labelwatcher. Are increased PL food sales Rolling out new packaging CVS “We are on the precipice helping the bottom line? Wegmans Design of new Just theof entering a new age of Ahold Always innovative Basics line is me-too whitegenerics — Essential Everyday PL design sameness[Supervalu], My Essentials Meijer 7 Eleven[Delhaize]—there’s no Good work with Meijers Gold Is 7-Select gettingpersonality to these brands,” Sam’s Club another redesign?complains Christopher Durham, Attractive new PL products Walgreenscreator of the What roll with Duane Readeblog and a member of PLBuyer’s PL play across the country?editorial advisory board. In their rush to tellconsumers their private labelsdeliver value, retailers aremissing the opportunity tocreate emotional connections shelf,” recalls Maute. Ironicallyto their brands, says Patrick name] are a sure sign of a private Paula Rosenblum, managing now, Walmart is bringing moreRodmell, CEO and president of label program,” says Rodmell, partner with RSR Research agrees. colors into the Great Value line.Watt International, a Canadian who will be co-chairing PLBuyer’s “Retailers believe consumers are Indeed, some retailers aredesign and marketing firm. new Design Excellence Awards more price sensitive than ever, so using colors to stand out from“Everybody’s trying to find later this year. they [retailers] are going to try the white movement. “Use ofwords that have specific Others, however, point out that to focus on more value messages vivid color continues to be ameanings,” he says of new there is method behind the white than ever,” and white says value. critical design element for us,”private label names that often wave sweeping over private label Walmart with its Great Value Mary Rachide, divisional viceinclude words such as essential. packaging. private label redesign in 2009 president for private brand at National brands don’t try “You’re seeing more and and Publix with its Publix brand Family Dollar, tells describe their products in more white, I think, because it’s in 2003 generally get kudos “Despite the whitening trendtheir brand names, Rodmell recognizable,” says Todd Maute, as the originators of the white across many other retailers, andnotes. Rather, they work to senior vice president/partner movement. When they did it, it in our national brand equivalentemotionally connect shoppers to with New York design firm CBX was novel. quality products, leveraging thetheir brands through marketing. Retail, and a judge for PLBuyer’s Walmart’s Great Value went Family equity is critical to helping“I think those more generic Design Excellence Awards. “It just from “being somewhat invisible our shoppers connect the productdescriptive words [in a product merchandizes better.” on the shelf to screaming on the back to Family Dollar.”WWW.PRIVATELABELBUYER.COM A U GU S T 2 0 11 PLBUYER 17
  3. 3. Cover Story PL 4TH QUARTER OUTLOOKIs white being over-used in private label packaging today? Some say yes, it looks generic.Others say no, it conveys value and a certain chic. Beyond white packaging and •Continued introductions of and community relations withpackaging redesign in general, private label line extensions into Lakeland, Fla.-based Publix.other trends evident this year new niches and new categories. • Increased promotionalinclude: At Publix, for example, “Similar activity for private label •Retailers, such as Supervalu, to the national brands, most new offerings. Contests and in-opting to create one private label products are line extensions to store events, long staples inthat spans multiple categories and existing [Publix] lines,” says the national brand marketingbanners. Maria Brous, director of media arsenal, are migrating to ENT COMPREHENSIVE PROGRAM: ReIN YERNG 2 DYNAMIC KEYNOTE PRESENTATIONS EV HI 8 INSIGHTFUL SESSIONS FROM TOP INNOVATORS T 10/06/11 - 10/07/11 W CHICAGO – CITY CENTER 6 SPONSORS: HOURS BUILT INTO THE PROGRAM TO ENGAGE WITH INDUSTRY EXPERTS AS WELL AS YOUR PEERS YOUR 2011 MUST-ATTEND EVENT PACKAGING THAT SELLS bridges package design with brand strategy and real-world examples of the powerful influence packaging has on consumer buying decisions. This conference is the go-to source for insights, inspiration, connection- LEARN MORE & REGISTER TODAY AT making opportunities and superior education for brand marketers and their package design and development teams.18 PLBUYER A U GU S T 2 0 11 WWW.PRIVATELABELBUYER.COM
  4. 4. PL 4TH QUARTER OUTLOOK Cover Story advisory board. “The media is That could spell flat private label The New Lines talking about branded products as sales for the year compared to the Supervalu’s May announcement if they were the underdogs.” that it would consolidate its 2 percent gain that the Private The year began with increased various store brands into Essential Label Manufacturers Association national brand promotional Everyday received generally activity aimed at regaining sales reported PL saw in supermarkets favorable reviews in the business. lost during and after the recession. last year, several experts predict. The move will produce cost ASprivate label, generally withpositive results. Looking ahead, expect Good AS ITprivate label to continuefacing the challenge of high Getscommodity prices for theremainder of the year as it triesto regain market share lost earlyin 2011 to increased national“We are on the precipiceof entering a new ageof generics — EssentialEveryday [Supervalu],My Essentials [Delhaize]—there’s no personalityto these brands.” For over fifty years LiDestri Foods has been as good as it gets while producing some of the food industries highest quality— Christopher Durham, Pasta Sauce & Alfredo Sauce, Salsa & Con Queso, Cooking Wines,creator, blog Vinegars, Infused Oils, Specialty Syrups, Barbecue Sauces, Fresh Apple Cider, Iced Tea, Lemonade and Drink Mixers. We produce all of our all-natural products with the highest qualitybrand promotional activity, ingredients in our four state-of-the-art USDA-approved plants.experts predict. To find out how our family can look after your private label needs, contact: The competition with national Edward P. Salzano • Executive Vice President/COO • 201.944.1233brands has heated up. “Thebiggest surprise for me is theamount of attention that has beengiven to the resurgence of nationalbrands,” says Carl Munyon, aveteran private label expert and www.lidestrifoods.coma member of PLBuyer’s editorialWWW.PRIVATELABELBUYER.COM A U GU S T 2 0 11 PLBUYER 19
  5. 5. Cover Story PL 4TH QUARTER OUTLOOKsavings in the 0.5 to 1.5 percent is reaching out through socialrange, experts estimate, while media, working with mommyalso breathing new life into what, bloggers, coupon bloggers andin some cases, had become rather others, to build buzz for the newstale banner private labels across line. It also is promoting the newits various chains (see PLBuyer, private label in circulars and byMarch 2011). showing products to consumers. “I think they’re starting to Drugstore operator CVSmove in the right direction,” saysJim Wisner, founder of WisnerMarketing Group, Libertyville, Ill.“One label will help them if thelabel is good, if they promote itand if they do all the blocking andtackling. If they start to get price-driven [however], they’ll blow it.” Industry veteran Munyonhas some doubts about the newbrand, however. “I would sayit’s a tale of good and bad. Onthe one hand, its shear genius toconsolidate all that buying powerinto one label. On the other hand,I’m not impressed by the nameEssential Everyday. That doesn’tseem to be a label that goes acrossall formats and projects an imageof quality or brandness to the Supervalu, with its new Essential Everyday line, and Family Dollar with its Family Gourmet new packaging,product.” are using bold colors with only white accents, breaking away from a private label packaging pack that increasingly is seeing all-white designs. Sam Mayberry, Supervalu’svice president of private brands,tells PLBuyer the new name Caremark announced in February Dollar has been extending it to the Kidget’s expansion thisconveys key attributes of the that it would roll out its new Just Kidget’s brand beyond diapers year, Family Dollar has “addednational brand equivalent line. the Basics line, one of the white into training pants, buoyed by its new items to our newly launchedThe line includes “products wave. Rival Rite Aid has been diaper sales success. “That we’ve Family Gourmet brand, expandedconsumers use on a frequent and introducing its Simplify line, been able to drive over 50 percent the Tropic Sun line to summereveryday basis and one they can another white wares line, for the diapers share in our private brand toys and Family Pet into pet foodrely upon for delivering quality,” past year and reported in June has been a very positive surprise,” and treats. In addition, we’vehe says. that its private label penetration Rachide tells PLBuyer. introduced a new ladies apparel The new line arose out of rate rose nearly 1 percent in its “The dollar stores are and accessories line – Mix &consumer research done by 2012 fiscal first quarter. “We’llSupervalu. “We started with the continue the rollout of our newshopper and wanted to make private brand architecture in the “Retailers believe consumers are moresure we understood what they second quarter,” said CEO Johnthought was a value,” explains Standley during an analysts’ price sensitive than ever, so they [retailers]Mayberry. Supervalu’s “primary call earlier this year. Rite Aid at are going to try to focus on more valuemotivator was to provide a brand that point had introduced 250that was easily identifiable across products with its new packaging messages than ever.”the store” that consumers could design and also was making someequate with value and quality, tweaks in its other private labels — Paula Rosenblum, managing partner, RSR Researchhe says. Mayberry would not such as Rite Aid Pharmacy healthcomment on what level of cost products, Renewal personalsavings Supervalu will realize by care products, Pantry foods and absolutely killing it,” when it Co., and continue to expandconsolidating its various banner Tugaboos baby products. comes to successfully expanding extremely me! in girl’s apparelprivate labels into Essential Private label diapers can their private label offerings, says and accessories,” she says.Everyday. represent a difficult selling RSR’s Rosenblum. Family Dollar, Addressing package design, he proposition to new parents more for example, has cleaned up its Supermarket Sweepssays “the label itself will convey worried about their baby’s bottom assortment of products, spruced When it comes to traditionalbrand image. A lot of time has than price. But the recession up stores and worked on pricing supermarkets and private label,been spent on the label itself.” mindset still gripping consumers issues, making it a standout this Kroger this year remains the The line is rolling out across today may be changing that. year, she says. leader among the large, nationalSupervalu banners initially in the “Traditionally diapers have Family Dollar’s Rachide notes holding companies, continuingbreakfast aisle, with cereal and been a high brand loyalty that “we’ve had two sustained to lead the pack with in-storeother breakfast offerings, in pasta category,” explains Family years of aggressive private brand execution of private label. Krogerand in pasta sauces. Supervalu Dollar’s Rachide. But Family product expansion.” In addition combines two key elements for20 PLBUYER A U GU S T 2 0 11 WWW.PRIVATELABELBUYER.COM
  6. 6. PL 4TH QUARTER OUTLOOK Cover Story have been, experts say. them, from shopping ad items “Contests to get people to purchasing private label to to try [private label] are the couponing.” absolute right thing to do,” At Supervalu, “I definitely Espelien says. New private label think that shoppers are under a promotional activity is “being lot of economic pressure,” says sparked by social media, those Mayberry. “I think shoppers are kinds of events work well in that still trying to save a dollar.” medium, I think we’re seeing At the same time people a lot of experimentation,” says economize with private label, Wisner. they also seek out what Family Contests and local promotions Dollar’s Rachide calls affordable help tie private label to their treats.private label success that otherretailers would do well to emulate– it does its consumer researchand it gives store managersincentives to sell more privatelabel, say supermarket watchers. Kroger “really understandsthe consumer and is managingto satisfy how consumers shop,”says industry veteran CraigEspelien, a member of PLBuyer’seditorial advisory board. Kroger has long worked withDunnhumby, a U.K. companywith U.S. offices, that analyzescustomer data and helps retailerscreate branding strategies. Kroger At Publix, PLBuyer’s private service area, explains Jonathan Perhaps that’s why retailerstargets new products and lines label retailer of the year, it’s been Asher, senior vice president at continue to move into premiumlike its mirra cosmetics, using a stay-the-course year, continuing Perception Research Services, a private label despite the toughDunnhumby data, Espelien notes. with promotions that prove Fort Lee, N.J.-based consumer economy. “Premium private labelThen it provides incentives to effective, such as its Store Brand research company. is certainly the most significantstore managers to execute at the challenge, now in its fifth year. “It makes tremendous sense [trend of this year], with all of thestore level. When it comes to new product for retailers to promote this way major retailers almost bordering “In supermarkets that are introductions, “the past year has as it is far more cost-effective on a religious revival” in theirgenerally over-SKUed and under- been consistent with the last four than advertising and, more belief that premium private labelutilized, [Kroger has] done an to seven years in that we review importantly, is community based, will sell, and will bring higherexcellent job of execution” with potential categories, evaluate which is a very significant part of profit margins than other PL tiers,private label, Espelien says. But he the business opportunity, and the retailers’ brand essence and says Wisner.cautions that he’s not impressed then determine if we will move point-of-difference vs. national Supervalu also is looking toby Kroger’s repositioning of forward to bring the product to brand manufacturers,” he says. premium for growth, Mayberryits Private Selection premium market,” says Brous. Looking at which private says. It is adhering to a three-tierprivate label, saying it too closely Supervalu’s Mayberry notes label product categories are strategy for private label, slottingresembles Safeway’s Safeway that he’s seeing an increase in the hot, experts point to appetizers Essential Everyday as its nationalSelect. number of new products being and dinner offerings touting brand equivalent tier. Safeway gets high marks offered by processors for potential restaurant-quality fare as And what will become of allfor packaging and product private label sale. “Manufacturers something consumers want as that white packaging? Likely thereinnovation. It introduced its Open have realized the potential” they continue to eat home rather will be more before there’s less.Nature private label in January for private label, he says; even than going out. Packaged deli “A certain amount of it isand created the world’s largest national brand manufacturers meats also should grow in sales ‘oh isn’t that sheik, isn’t thatpicnic table in June to promote it. are now turning to private this year for the same frugal contemporary,’” Asher says ofWhile that stunt garnered media label production and offering consumer-prompted reason. the use of white. “But no matterattention, Safeway in general has new products to attract retailer Ditto personal care products. what you did, to some degree itbeen focused on private label back business. Shoppers are still worried about harkens back to the old details in recent years as their financial well-being. You can use white but you haveit shifted from using an outside Promote Away Says Publix’s Brous, for to use it the right way.” Thefirm to managing private label in Publicity stunts like Safeway’s example, “Our markets in right way will depend on brandhouse, and so still lags when it picnic table, promotions and the southeast are still very positioning, quality, pricing andcomes to in-store execution, says contests are becoming more the recessionary and customers are promotional muscle put behindEspelien. norm for private label than they utilizing all options available to the product. PLBWWW.PRIVATELABELBUYER.COM A U GU S T 2 0 11 PLBUYER 21