Twenty years ago, retailers aiming to launch new store brands to fend off the negative associations created by the “generics era” would say to their design agencies, “Get this as close to the national brand target as you possibly can.” Call it the copycat phase of private label development.
Mimicking Green Giant or Coca-Cola was a big improvement over what had come before — a plain white can with nothing but “green beans” or “soda” on the label. The goal was to change the perception (often times deserved) of lower quality.
Today, thanks to the creativity of chains like Target, Costco, Publix, Whole Foods, Wegmans, Trader Joe’s and Walmart, consumers no longer see private-label products as inferior copycats. The biggest store brands are worth billions of dollars, and in the post-pandemic era the industry is setting all-time sales records.
So has private label finally overcome its decades-old identity crisis and laid the copycat impulse to rest? Alas, not quite yet.
Look closely at the latest crop of newly launched store brands in grocery and retail. In many cases, the color palettes, fonts, spacing, verbal identities and even naming conventions (“this & that”) are broadly similar. Overall, the aesthetic is quite close to Target’s Good & Gather — a neat, clean and design-forward store brand that hits the bullseye (pardon the pun) of what the brand is all about.
But other grocers and retailers are not Target. They come to the table with different stores, brand identities and customers. Their private label offerings and go-to-market strategies should be distinct and mutually reinforcing, with verbal and visual messaging all their own. Anything less would be a missed opportunity.
And yet, some retailers have gravitated toward a look that might be dubbed “copy & paste.” But this time, the similarities are strikingly close to other private label brands versus national brands.
Putting Strategy First
The best retailers think carefully about how the attributes of their store brands fit into their overall go-to-market strategies and the needs of the customers. Contemporary design makes perfect sense for Target. Quirky and offbeat is what Trader Joe’s is all about. Why should a value grocer that operates in lower-income areas mimic these looks? The focus should be on creating brands that convey exactly what you do best — whether it’s giving people high-quality products and an organic coop-like experience or smartly delivering on price or value.
To be sure, retailers can and do use store brands to move in new directions. Let’s say a grocer wanted to change its marketplace identity. The company might also want to re-evaluate its private brand offer and create new looks to suit this evolving strategy. But if the chain fails to follow up by re-envisioning and reinvesting in its shopping experience, this “new direction” could fall flat on its face due to misalignment.
Strategic use of private label also can vary based on the strength and focus of the master brand. For example, certain multi-nameplate, mass-market grocers operate in places with widely divergent demographic profiles. Here, creating a mix of audience- or category-appropriate store brands is a fine strategy, allowing you to better connect with your diverse customer base.
By contrast, specialty retailers with dominant master brands and relatively consistent site and market criteria — Whole Foods, Trader Joe’s and Wegmans come to mind — need not be chameleon-like at all. It makes sense for them to leverage that strength and the same store brands everywhere they go.
Instead of thinking about private label in terms of what others are doing with design — or even their own product tiers (“good,” “better” or “best”) — retailers need to use their store brands to accomplish specific goals. What categories are you trying to win? What hard-won equities do you want to celebrate? Where do you stand the best chance of differentiating yourself? Where do you need to be most competitive and value-driven?
Seizing the Moment
Retailers and manufacturers deserve credit for store brands’ remarkable progress. However, simple economic realities are part of the picture. Private label always thrives when people are more cost-conscious, which is certainly the case today.
While it is good news that consumers are engaging with store brands, they might be buying them because they have to, not because they want to. This captive audience will not last forever. Retailers should seize the moment by developing brands that can achieve higher and more sustainable private label penetration — a proven way to drive long-term loyalty. The first steps are to understand exactly who you are as a retailer and get to know your customer. At the end of the day, your private label strategies and brands need to build upon your own distinct personality and customer needs.
Inspiration is part of any creative endeavor, and it’s fine to push the envelope. Just watch the impulse to copy — and make sure you’re pushing the envelope in the right direction.
Todd Maute is a Partner at CBX, the New York-based brand strategy and design agency. He works with clients across multiple channels of trade including grocery, pharmaceutical, mass, pet specialty, consumer electronics, convenience, office, home improvement, warehouse clubs and auto parts supply.