Comments on: Stick With Store Brands Or Go Back to National Brands? That Is The Question. http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/?utm_source=rss&utm_medium=rss&utm_campaign=stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question Opinions. Commentary. News. Sun, 12 Feb 2012 02:23:11 +0000 http://wordpress.org/?v=2.9.1 hourly 1 By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43817 Ted Mininni Mon, 18 Jan 2010 17:59:19 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43817 Tara, You raised some good points, and I thank you. Right: when thinking green, less is more when it comes to packaging. In fact, this is the first consideration for all CPG companies. If extraneous packaging can be done away with, without compromising the quality, freshness or integrity of products, great. The next step would be to source materials from renewable sources, and if not available, materials that are easier to recycle or repurpose. As to consumer input, more and more companies are leveraging social media to do just that, Tara. Still others are putting out a direct call to interested consumers to share their ideas and even conceptualize with their R&D departments. As you observed: better to get consumer input and direction and try to push "innovative" solutions to consumers who may not want what CPG companies think they do. Tara,

You raised some good points, and I thank you. Right: when thinking green, less is more when it comes to packaging. In fact, this is the first consideration for all CPG companies. If extraneous packaging can be done away with, without compromising the quality, freshness or integrity of products, great. The next step would be to source materials from renewable sources, and if not available, materials that are easier to recycle or repurpose. As to consumer input, more and more companies are leveraging social media to do just that, Tara. Still others are putting out a direct call to interested consumers to share their ideas and even conceptualize with their R&D departments. As you observed: better to get consumer input and direction and try to push “innovative” solutions to consumers who may not want what CPG companies think they do.

]]> By: Tara http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43806 Tara Mon, 18 Jan 2010 16:06:36 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43806 Ted, I tend to think that perhaps it is a time for CPG companies to innovate in other areas of their business. Rather than adding a new scent to laundry detergent or adding another spice combo to marinara sauce maybe it is time to explore ways to improve their customer relations? Being "different" and "better" doesn't have to be strictly at the primary product level. Your points regarding packaging are more aligned with what I was thinking in my initial response. For the green movement maybe it is time to look at a less is more approach to packaging. This does happen in some spaces but I am sure there is room for growth and to establish thought leadership. Perhaps it is time for CPG to consider a more user oriented approach and to begin to truly interact with their customers rather than pushing. Ted, I tend to think that perhaps it is a time for CPG companies to innovate in other areas of their business. Rather than adding a new scent to laundry detergent or adding another spice combo to marinara sauce maybe it is time to explore ways to improve their customer relations? Being “different” and “better” doesn’t have to be strictly at the primary product level. Your points regarding packaging are more aligned with what I was thinking in my initial response. For the green movement maybe it is time to look at a less is more approach to packaging. This does happen in some spaces but I am sure there is room for growth and to establish thought leadership. Perhaps it is time for CPG to consider a more user oriented approach and to begin to truly interact with their customers rather than pushing.

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43678 Ted Mininni Sat, 16 Jan 2010 16:30:21 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43678 Hi Adam, You've shared some great observations with us. I'd like to comment on the points you've made. You're right in saying that many retailers have hired astute marketers away from CPG companies. You're also right in saying that most store brands tend to be regional rather than national in nature. . .but not all of them are. Look at what Penney's is doing with its American Living brand, for example. Look at Home Depot's Behr paints. Even supermarkets like Safeway are getting into the act gradually. Remember that the grocery giant has begun to distribute its PL lines to other supermarket chains, for example. But I wouldn't count national brands out, either. Consumers find comfort and reassurance with heritage brands and products they've turned to for many years. And with their reach and power, let's not forget that national brands have every opportunity to innovate and engage consumers. If anything, our economy and the latest marketplace developments make it essential for retail and national brands to be on top of their game. It really is survival of the fittest time. Thanks, Adam, for adding so much to my post. I always look forward to reading what you have to say. Hi Adam,

You’ve shared some great observations with us. I’d like to comment on the points you’ve made. You’re right in saying that many retailers have hired astute marketers away from CPG companies. You’re also right in saying that most store brands tend to be regional rather than national in nature. . .but not all of them are. Look at what Penney’s is doing with its American Living brand, for example. Look at Home Depot’s Behr paints. Even supermarkets like Safeway are getting into the act gradually. Remember that the grocery giant has begun to distribute its PL lines to other supermarket chains, for example. But I wouldn’t count national brands out, either. Consumers find comfort and reassurance with heritage brands and products they’ve turned to for many years. And with their reach and power, let’s not forget that national brands have every opportunity to innovate and engage consumers. If anything, our economy and the latest marketplace developments make it essential for retail and national brands to be on top of their game. It really is survival of the fittest time.

Thanks, Adam, for adding so much to my post. I always look forward to reading what you have to say.

]]> By: Adam Schorr http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43627 Adam Schorr Fri, 15 Jan 2010 20:40:07 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43627 Ted: I mostly agree. But national brands have no exclusivity on research or testing products on a national scale. They have no proprietary research methodologies. They have no proprietary access to focus groups or consumer panels. The only entity that has something proprietary is the retailers. They have their stores and the minute by minute data they get from their scanners. Retailers have been hiring classical CPG market researchers (and marketers) for a few years now. If I had to choose between the research abilities of a large branded goods player and the massive data store that the retailers are sitting on plus one genius Google programmer, I'd take the latter in a heartbeat and put the brands out of business. Quickly. The retailers aren't quite good at this yet but they will be. And when that happens the national brands will have nothing to offer. And the brands certainly have no distribution advantages over the retailers. As far as driving traffic, consumers trust big brands less than ever. They are less engaged with the communication vehicles that big brands know. In short, the ability of the brands to move people into stores is diminishing. These guys are dinosaurs. And if they don't change soon they will be extinct. Ted:

I mostly agree. But national brands have no exclusivity on research or testing products on a national scale. They have no proprietary research methodologies. They have no proprietary access to focus groups or consumer panels. The only entity that has something proprietary is the retailers. They have their stores and the minute by minute data they get from their scanners. Retailers have been hiring classical CPG market researchers (and marketers) for a few years now. If I had to choose between the research abilities of a large branded goods player and the massive data store that the retailers are sitting on plus one genius Google programmer, I’d take the latter in a heartbeat and put the brands out of business. Quickly. The retailers aren’t quite good at this yet but they will be.

And when that happens the national brands will have nothing to offer.

And the brands certainly have no distribution advantages over the retailers.

As far as driving traffic, consumers trust big brands less than ever. They are less engaged with the communication vehicles that big brands know. In short, the ability of the brands to move people into stores is diminishing.

These guys are dinosaurs. And if they don’t change soon they will be extinct.

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43555 Ted Mininni Mon, 11 Jan 2010 13:50:02 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43555 Excellent observations, Tara. Thanks for weighing in here. I agree: for national brands to continue to be relevant, they will have to innovate. The old "new and improved" marketing line is tired and meaningless. True innovations might include: more convenient to use or reusable packaging. How about packaging that stores food products to ensure freshness longer or greener packaging? Better flavor profiles? Higher quality that can actually be tasted? I'm not so sure that CPG companies have a slow innovation cycle in general. In 2009, many opted to NOT fill the pipeline with new products due to the severity of the recession, and a precipitous drop in consumer spending. As we go into 2010, I expect that to change. Lastly, I agree: competition is always great for the marketplace and for consumers. Excellent observations, Tara. Thanks for weighing in here. I agree: for national brands to continue to be relevant, they will have to innovate. The old “new and improved” marketing line is tired and meaningless. True innovations might include: more convenient to use or reusable packaging. How about packaging that stores food products to ensure freshness longer or greener packaging? Better flavor profiles? Higher quality that can actually be tasted?
I’m not so sure that CPG companies have a slow innovation cycle in general. In 2009, many opted to NOT fill the pipeline with new products due to the severity of the recession, and a precipitous drop in consumer spending. As we go into 2010, I expect that to change. Lastly, I agree: competition is always great for the marketplace and for consumers.

]]> By: Tara http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43515 Tara Mon, 11 Jan 2010 00:27:57 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43515 Shoppers today have so many options for even the most basic of items and are increasingly more educated through the vast amount of information that is at their fingertips thus it is not a surprise that it takes much more than a clever play of the emotions through an advertisement to keep brand loyalty. I personally have given store brands a try and been pleasantly surprised. It certainly makes you think twice about paying more simply for a brand name on a basic household product. In most industries being a market leader requires a blended approach of offering a superior product and continual innovation and improvements along with a pricing structure that coincides with the perceived value. Many packaged goods have a slow innovation cycle leaving a large window of opportunity for competitors to catch up. I think the competition that store brands are bringing to the table is great for the market place. Shoppers today have so many options for even the most basic of items and are increasingly more educated through the vast amount of information that is at their fingertips thus it is not a surprise that it takes much more than a clever play of the emotions through an advertisement to keep brand loyalty. I personally have given store brands a try and been pleasantly surprised. It certainly makes you think twice about paying more simply for a brand name on a basic household product.
In most industries being a market leader requires a blended approach of offering a superior product and continual innovation and improvements along with a pricing structure that coincides with the perceived value. Many packaged goods have a slow innovation cycle leaving a large window of opportunity for competitors to catch up. I think the competition that store brands are bringing to the table is great for the market place.

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43501 Ted Mininni Wed, 06 Jan 2010 12:42:10 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43501 Lindsey, You sound like a discerning, thoughtful customer. Good for you. I like your observations, because many consumers "forced" to buy PL brands to save money over the past year, were surprised to see little, if any difference between them and the brands they had been buying. Since store brands are co-packed by national brand manufacturers for the most part, and retailers have increasingly demanded higher quality, the results speak for themselves. Retailers paying attention to their PL brands, and deliberately working to market them, have been richly rewarded. Net result: they're building a nice, profitable business while shoring up customer loyalty to their stores. That's a win for them. Thanks, Lindsey, for sharing your insights with us. Lindsey,
You sound like a discerning, thoughtful customer. Good for you. I like your observations, because many consumers “forced” to buy PL brands to save money over the past year, were surprised to see little, if any difference between them and the brands they had been buying. Since store brands are co-packed by national brand manufacturers for the most part, and retailers have increasingly demanded higher quality, the results speak for themselves. Retailers paying attention to their PL brands, and deliberately working to market them, have been richly rewarded. Net result: they’re building a nice, profitable business while shoring up customer loyalty to their stores. That’s a win for them.
Thanks, Lindsey, for sharing your insights with us.

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43500 Ted Mininni Wed, 06 Jan 2010 12:37:06 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43500 Hi Adam, I appreciate and agree with much of your assessment here. Like you, I believe the heritage of many national brands gives them great leverage, if they continue to roll out leading products. But if they sit on their laurels, they will continue to see diminished market share. There's just too much competition now. Store brands used to be pretty pathetic but dedicated retail marketers have changed all of that. There's nothing generic about private label these days. In fact, they meet or exceed many national brands. However, national brands have great things going for them besides heritage. They have the ability to conduct research, test products on a national scale and drive distribution. Those assets really matter. I disagree that the only thing national brands do is advertising blasts. Many have strong web sites and engage in SM in some form or other. This gives them an opportunity to interface directly with consumers in a way they have never done before. In the past, the retailers as middle men did that. What national brands can learn, as a result, ought to be fully utilized in bringing out the next generation of new, not so easily copied, products. Thanks, Adam. Great stuff. Hi Adam,
I appreciate and agree with much of your assessment here. Like you, I believe the heritage of many national brands gives them great leverage, if they continue to roll out leading products. But if they sit on their laurels, they will continue to see diminished market share. There’s just too much competition now. Store brands used to be pretty pathetic but dedicated retail marketers have changed all of that. There’s nothing generic about private label these days. In fact, they meet or exceed many national brands. However, national brands have great things going for them besides heritage. They have the ability to conduct research, test products on a national scale and drive distribution. Those assets really matter. I disagree that the only thing national brands do is advertising blasts. Many have strong web sites and engage in SM in some form or other. This gives them an opportunity to interface directly with consumers in a way they have never done before. In the past, the retailers as middle men did that. What national brands can learn, as a result, ought to be fully utilized in bringing out the next generation of new, not so easily copied, products.
Thanks, Adam. Great stuff.

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43499 Ted Mininni Wed, 06 Jan 2010 12:29:46 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43499 David, You've hit on the most important points about store vs national brands. Thank you for your observations. I do believe the gap on quality, packaging and marketing has closed considerably between the two. Many food industry experts' research shows that people who have been happy with store brands are less likely to return to national brands, even as the economy improves. This does put pressure on national brand manufacturers. However, cost cutting isn't necessarily the only, or the best thing they can do to reinvigorate their brands. For example, continued, smart innovations are likely to be embraced by customers. Bottom line: increased competition for consumer dollars ought to keep everybody sharp. That generally leads to a "win" for consumers, doesn't it? David,
You’ve hit on the most important points about store vs national brands. Thank you for your observations. I do believe the gap on quality, packaging and marketing has closed considerably between the two. Many food industry experts’ research shows that people who have been happy with store brands are less likely to return to national brands, even as the economy improves. This does put pressure on national brand manufacturers. However, cost cutting isn’t necessarily the only, or the best thing they can do to reinvigorate their brands. For example, continued, smart innovations are likely to be embraced by customers. Bottom line: increased competition for consumer dollars ought to keep everybody sharp. That generally leads to a “win” for consumers, doesn’t it?

]]> By: Ted Mininni http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43498 Ted Mininni Wed, 06 Jan 2010 12:20:23 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43498 Hi Paul, Your observation mirrors that of many consumers over the years. For those who have tried store brands, found them wanting in some way, and they've decided to stick with the national brands for the most part. Out of sheer necessity, consumers have again tried PL over the past year, and found appreciable quality improvements, however. Living in California, you might want to try Safeway's store brands at some point, Paul. I think you'll be pleasantly surprised by how good they are. BTW: some store brands even offer some pretty good organic baby food choices now. Please give them a try. Thanks for weighing in, Paul. I appreciate your insights as ever. Hi Paul,
Your observation mirrors that of many consumers over the years. For those who have tried store brands, found them wanting in some way, and they’ve decided to stick with the national brands for the most part. Out of sheer necessity, consumers have again tried PL over the past year, and found appreciable quality improvements, however. Living in California, you might want to try Safeway’s store brands at some point, Paul. I think you’ll be pleasantly surprised by how good they are. BTW: some store brands even offer some pretty good organic baby food choices now. Please give them a try.
Thanks for weighing in, Paul. I appreciate your insights as ever.

]]> By: Lindsey http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43485 Lindsey Wed, 06 Jan 2010 00:50:50 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43485 I didn't start doing it on purpose, but I did start buying store brands this year. I just starting paying more attention to what I was paying, and the price differences on some items just shocked me, so I started trying a few different things. Overall, I haven't notice much of a difference. I had read that many generic brands are made in the same factories as the name brands, and after sampling some I'm not surprised. I'll continue doing this on certain items, like cheese and milk. I didn’t start doing it on purpose, but I did start buying store brands this year. I just starting paying more attention to what I was paying, and the price differences on some items just shocked me, so I started trying a few different things. Overall, I haven’t notice much of a difference. I had read that many generic brands are made in the same factories as the name brands, and after sampling some I’m not surprised. I’ll continue doing this on certain items, like cheese and milk.

]]> By: Adam Schorr http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43484 Adam Schorr Tue, 05 Jan 2010 20:36:10 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43484 National brands had better get very clear about this: The private label trend started way before the recent economic meltdown and will continue long after this recession is over. Why? Because national brands usually offer no reason whatsoever for consumers to pay the price premium they demand. This isn't 1950 anymore. The average consumer is well-informed. But the marketing model of today is still the marketing model used decades ago to create these big brands: blast expensive over-produced TV ads at consumers who don't know any better. There's only one way for the national brands to survive: Make kick-ass products that cannot be easily copied. If your products are commodities then they will command commodity pricing. And if you have the cost structure of a branded goods player, you will lose. It is just than simple. National brands had better get very clear about this: The private label trend started way before the recent economic meltdown and will continue long after this recession is over.
Why? Because national brands usually offer no reason whatsoever for consumers to pay the price premium they demand. This isn’t 1950 anymore. The average consumer is well-informed. But the marketing model of today is still the marketing model used decades ago to create these big brands: blast expensive over-produced TV ads at consumers who don’t know any better.
There’s only one way for the national brands to survive: Make kick-ass products that cannot be easily copied. If your products are commodities then they will command commodity pricing. And if you have the cost structure of a branded goods player, you will lose. It is just than simple.

]]> By: David Mace http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43483 David Mace Tue, 05 Jan 2010 20:32:13 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43483 We've definitely experimented with store brands, and we've largely been happy. In fact, my daughter loves Kroger mac and cheese above Kraft. I think the national brands should definitely be concerned, because Target, Kroger, Safeway, COSTCO and others are putting out products that taste and perform very nicely. They are giving us the best of both worlds: great taste; great price. In order to compete, the national brands will need to do two things: 1.) convince me why I should love their brand, e.g. Coca-Cola 2.) find a way to drive down costs so they can be more price-competitive. We’ve definitely experimented with store brands, and we’ve largely been happy. In fact, my daughter loves Kroger mac and cheese above Kraft. I think the national brands should definitely be concerned, because Target, Kroger, Safeway, COSTCO and others are putting out products that taste and perform very nicely. They are giving us the best of both worlds: great taste; great price. In order to compete, the national brands will need to do two things: 1.) convince me why I should love their brand, e.g. Coca-Cola 2.) find a way to drive down costs so they can be more price-competitive.

]]> By: Paul Barsch http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/comment-page-1/#comment-43482 Paul Barsch Tue, 05 Jan 2010 20:06:17 +0000 http://www.mpdailyfix.com/stick-with-store-brands-or-go-back-to-national-brands-that-is-the-question/#comment-43482 Hi Ted, the following statement highly depends on how picky a person is, but I believe that in some instances, private brands just don't stack up to national brands. There are some items that I've tried over the years that just don't measure up to the national brand (ketchup, mayo, detergent and even cheese). I was also surprised to see baby food on your list because even something as simple as pureed apples may have different consistencies across brands. In many cases,the national brand is the leader for a reason. Hi Ted, the following statement highly depends on how picky a person is, but I believe that in some instances, private brands just don’t stack up to national brands. There are some items that I’ve tried over the years that just don’t measure up to the national brand (ketchup, mayo, detergent and even cheese). I was also surprised to see baby food on your list because even something as simple as pureed apples may have different consistencies across brands.
In many cases,the national brand is the leader for a reason.

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