Brands and own-brands are battling for supermarket supremacy

As cash-conscious consumers head for own-brands, brands are fighting back with new innovations, finds Angus Montgomery

Almost three quarters of British consumers are now opting for supermarket own-brand labels in their weekly shop, according to new research.
Nearly 10 000 people were surveyed in the poll, from comparison service U Switch, which claims that 73 per cent now choose own-brand labels. This is a massive jump from 25 per cent in August 2008, according to a report by the same company.

Economic considerations are obviously a huge influence on this jump. Rumina Hassam, personal finance expert at U Switch, claims that by ‘switching down a brand’, consumers could save 15 per cent from the family shop every year – potentially saving each household £800.

The survey also claims that supermarkets are persuading consumers to switch from branded products by expanding their own-brand ranges, citing examples including Waitrose’s Essential range, designed in-house, which launched in March and will continue rolling out in stores until October.

Budgens is also currently in the throes of launching its own-brand range, designed by a Pentagram team led by partner Harry Pearce. The Good Value range hit shelves in January, with two more ranges, under the working titles Better and Best, rolling out this year (DW 9 July).

Paul King, retail director at Vivid Brand, says it is this breadth that gives own-brand products an advantage over their branded rivals. ‘Own-brands are generally set up in the “value, better and best” model, and no brands can generally have that sort of spread – they’re usually much more linear,’ he says.

King says that this sort of range allows own-brand products to provide both ‘value and adventure’.

He adds that this strategy obviously gives own-brand ranges much more opportunity for targeting consumers. ‘The whole point is that if you can bring in a consumer on one value product, chances are they will buy other products in that range,’ he explains.

One company that is attempting to beat own-brands at their own game is Procter & Gamble, which announced the launch last month of its value range of Pampers Simply Dry nappies and Pampers Simply Clean wipes. Speaking at the time of the launch, Paul Lettice, trade communications manager for P&G, said, ‘The range is an important part of the brand’s commitment to growing the category.’

However, a P&G spokeswoman denied this was a direct attempt to compete with own-brand ranges, saying the range has been introduced because ‘Pampers understands that in the current climate mums want more choice.’ She wouldn’t comment on whether P&G would consider adopting the value tactic for other ranges, but did say, ‘We will continue to invest in innovation across our entire portfolio. In both good and bad economic cycles there are consumers with different needs, and we want to surprise and delight as many of them as possible.’

Brand-owners are remaining bullish in the face of growing and sophisticated competition from own-brand products. Bart Becht, chief executive of Reckitt Benckiser, which owns brands including Dettol and Nurofen, recently told the Financial Times that he predicted that UK retailers would begin to stock more branded products, as consumers took against own-brand goods. He claims that decisions by European retailers to devote less shelf space to branded products – Spanish retailer Mercedona recently decided to ditch all own-brand products – are driven more by trade than consumer, and added, ‘Now, across Europe, people are bringing back more branded products.’

Last July, Marks & Spencer introduced a number of branded products, including Coca-Cola, Marmite and Persil, into 19 stores in the North East, in a trial which was extended to a further 20 stores in the South East in April this year. At the time a spokeswoman told Design Week, ‘We have no intention of delisting any of our products to make way for these brands, nor will we stop developing our own-branded products. This is about enhancing, not crippling, our own-brand offer.’

King concludes that, in his opinion, there will not be a clear winner between own-brand and brands. He says, ‘Something I tell all our designers is, “Go to the supermarket and look in the baskets at the checkout”. What you see is a mix of own-brands, value products, core products and brands.It’s all about a careful balancing act.’

Hide Comments (1)Show Comments (1)
  • will November 30, -0001 at 12:00 am

    i hate this pile of shit get a knew websit

  • Post a comment

Latest articles