In the past, private label brands were often situated at an unfair disadvantage as far as brand perception, often mistaken to be of lesser quality thanks in part to a lower price. However, private label brands have since come to outpace national brands and are now giving these big brands a run for their money.
Today, these are most often referred to as store brands, and they have become vital to the grocery retailer’s growth. They are also a key component in the growth of customer loyalty since they are exclusive to that retailer and the customer will return to buy the store brand product again and again.
So what led to this change? Price is no longer the deciding factor – although of course it does have an impact. Instead, brand trust has come to represent a great deal of the switchover sales. Trust and brand perception have grown steadily, and this is especially true when it comes to millennial shoppers, those born, typically, between 1980 and 2000. Why is this the case? Often it has a lot to do with innovation. According to a recent report from market research done by Mintel, 42% of millennial shoppers see private label brands (store brands) as more innovative than big brand products. When searching for value for their money, coupled with great quality, millennials tends to see store brands as having more to offer.
On the other hand, according to the study, shoppers in the baby boom generation tend to remain more loyal to bigger brands, mainly due to earlier private label experiences (when many stores were still ironing out the kinks) and an historic sense of brand loyalty developed over several years.
So, armed with this knowledge, what then do we know about what customers are looking for when it comes to private label brands? What catches the eye and incites an individual to purchase?
- Promotion of store brands needs to be comparable to the national brands, especially when it comes to point of purchase displays (these displays still carry a lot of weight no matter the shopper’s age).
- Clean labels with easy to read type for ingredients and product claims – this has a lot to do with brand transparency and helps to build that trust we mentioned earlier.
- Simple focussed messaging, clean images and colourful graphics have replaced cluttered, scattered messaging.
- Functionality is key when it comes to innovation. A package that can do more than just house a product on the shelf will always stand out.
- Sustainability is also crucial. Packaging with a focus on the environment has become far more attractive and can mean big gains as far as sales.
So, how does your packaging stack up? Whether you are a store brand or a national brand, packaging has a lot to do with your sales – are you competing at the highest level?
For more about gains being made by some private label brands, and how you can compete, please contact Packaging Technologies Inc. today at 1-800-303-5883.
