PLBUYER DECEMBER 2010 The Ten Keys to Private Brand Success 1 Guest Commentary BY PATRICK RODMELL KEY NO. 1 – STRATEGIC BRAND POSITIONING If you don’t know where you are going, any road will get you there. I ’m sure most of you know the I offer in which categories and expectations in the minds of your in almost every category. Strictly famous Lewis Carroll quote “If when should I create category- shoppers. But not every category enforced design systems across a you don’t know where you are specific brands? needs the three-tiered good, better private brand should be avoided going, any road will get you there.” • Design system. Should I adopt and best private brand options. for all but value-based brands, A successful private brand program a design strategy that is Loblaws and Target (see PL Buyer, where quality claims take a back is no exception – if you don’t have systematic across the entire November, 2010), often regarded seat to a dominant value message. an objective and a strategy for your range or more specific to as best-in-class private brand This doesn’t mean that a private brand program, there’s no category or SKU? retailers, have only two significant private brand should not have telling where you’re going to end • Specialty categories. What tiers in their grocery offering – characteristics that hold the entire up or how successful you will be. do I do with specialty something many retailers forget range together. But too many To maximize the potential of categories like organic, natural when benchmarking themselves retailers today are obsessed with any private brand, a retailer must and healthy-alternative against these retail powerhouses. consistency, thereby compromising first understand the role the brands product ranges? For many retailers, a two-tiered item appeal. The short-term lure can play in the overall strategy for So let’s take a look at each of quality strategy is, in fact, the right of cost efficiencies that come with the business. Looking at the big these and see how they affect the way to go. strictly enforced systematic designs picture, the role for private brands overall private brand strategy. Regardless of the number of may be tempting, but attention eventually ladders up to these three While there are exceptions to every tiers, we encourage our clients to to category specifics is what core strategies: rule, a look at the fundamentals will expand the ranges of their ‘best’ eventually drives repeat sales. • Deliver better margins get the right conversation going. private brands, as these products And finally, what to do about • Create store loyalty Private brands with the retailer’s can be offered at advantageous specialty categories like organics. • Support overall retailer brand name as part of the brand generally price points – just below national Generally speaking, we prefer an equity take less time and marketing brands – and still support an endorsement strategy; where the But given this multi-faceted role, investment to win shopper loyalty, overall store position of quality. product range is labeled organics many roads can be taken when so where it makes sense, use your Value-based private brands and endorsed by the retail name. defining the brand strategy – some store name. should be used to drive store This allows the primary purchase more direct than others – and a But while using the store name traffic, supported by strong price driver to take center-stage, and still number of fundamental strategic on private brands is fundamentally messages in external marketing. allows the retailer to get credit. decisions need to be considered recommended, stay away from But in-store strategies – including Private brand success starts with that will have a huge impact on putting your name on value-tier strong packaging creative – should a private brand strategy and the the end result. Take one road and programs, unless you’re a discount encourage the shopper to trade up best private brand strategy is born you can end up with product going retailer, or product categories to the best private brand quality out of the overall strategy for the stale on the shelf, take another that aren’t in line with your core option when they’re at the shelf. business. The key here is to map and your private brand portfolio offering, for example, OTC in Whatever quality tiering strategy out the entire product portfolio in can be a significant contributor grocery, food at mass merchants, is adopted, the individual package a brand architecture, layering both to the overall business, driving beverages in drugstores. This is design should always be just holistic program goals and SKU- store traffic and delivering healthy particularly important in the early slightly aspirational; food styling or specific requirements. This will margins. stages of brand launch or re-launch. product claims that over-promise help ensure that every brand has While the best strategic Once the brand is established, on actual quality are just as bad as a proper role to fill and no gaps solution is unique to each you can start testing its ‘stretch’ into underwhelming packaging, and can are left in the program offering. retailer’s situation, there are some non-traditional product categories, lead to overall store brand equity A strategically sound brand fundamentals that set a good but this should be done carefully erosion just as quickly. architecture is the roadmap that framework for decision-making and you should monitor consumer Aspirational packaging is gets you where you want to go. PLB and get the program headed in the response to make sure you haven’t difficult to realize through a right direction. gone too far. Of course, retailers strict design system, where every The most common strategic that have multiple store banners item in the line has a regimented Patrick Rodmell is President and CEO of branding issues raised by our like Safeway, Supervalu and Kroger architecture of brand, image and Watt International, a Toronto-based retail clients include: face the pragmatic issues of label type. Simply put, aspirations vary agency. He can be contacted at prod- • Naming. Should the name of conversion and management when widely by product category and email@example.com. This is the first of 10 our store be the name of our they use banner brand names on even item, so one system doesn’t fit columns in which he will be discussing his private brand? private label, but in most cases the all – what is aspirational in cookies keys for transforming store brands into • Quality tiering/category benefits outweigh the costs. is quite different from pasta. retail brands, i.e. brands with cache and branding. What quality of Quality tiering by brand is National brands have established consumer appeal that goes beyond merely private brand products should an effective way to set clear some deep-rooted expectations the lower-price message.