Brand Killers Store brands aren\'t for losers anymore. In fact, they\'re downright sizzling. And that scares the soap out of the folks who bring us Tide and Minute Maid and Alpo and...
-Melanie Turner forgot her shopping list. But the 42-year-
Old-age consultants who have just entered the city more than 133,000square-
Located in foot warehouse store in Norwalk, Connecticut.
Don\'t seem to mind.
Turner knows where she\'s going.
In the detergent section, her hand passes through the falls of P & G and grabs two 96-
Kirkland Signature oz bottle, in-
The store brand Costco put on everything from cashew nuts to crosses
At dinner, she troll, with some fresh fish, dragged the 1/2-pound fish --
A kilo of Jifu-
It also features a striking red, white and black Kirkland logo.
It was then on the paper aisle where she picked up a large number of Kirkland napkins, Kirkland toilet paper and Kirkland napkins. . .
Wait, where\'s Kirkland paper towel?
Her eyes glanced at the mess in the store. -No trace of them. -
Rest before you come 12-pack of Bounty.
The moment of decision.
\"I will wait for this,\" she concluded . \".
On the micro side, that\'s why Melanie Turner scared the pants off from P & G, Unilever, Kraft and almost all consumer goods companies.
Her shopping cart is heading towards the checkout counter with almost no national brand in it.
It was not long ago that this great American brand would not be treated like this.
You are a symbol of a good life: a refreshing pause, a champion breakfast, filtered cigarettes with unfiltered flavors.
Everyone wants a part of you.
But you have gone a long way. -down.
No, brand loyalty is not dead.
We \'ve heard about the knell before, especially after Philip Morris cut the knell 40% on marl Road on Friday, 1993. This has put investors in panic, reducing the market value of 25 top brand manufacturers by nearly $50 billion.
But for a long time, we have been tempted to return to the brand by a trendy person or an apple.
As a matter of fact, Melanie Turner\'s equally brand-loyal mom was in the 1960 s when she put the Queen\'s House in the cupboard: \"We are the ski family,\" Turner recalls.
The difference today is who owns and creates Turner\'s loyal product.
An almost imperceptible structural shift is reshaping the world of brands. Retailers--
Used to be a low-level vendor of brands manufactured and sold by major manufacturers ---
Now it\'s like full-
Mature Marketing staff
This is the part of the earthquake: this is their brand-
Instead of traditional power companies like Kraft or Coca-Cola-
It was Melanie Turner who won the largest number.
Brands like Wal-Mart
Wal-Mart\'s \"Roy dog food\" has quietly surpassed Nestle\'s \"premier\" to become the world\'s top brand.
Dog food. -
Or the George series, which got Liz kleburn\'s clothes out of Wal-Mart. Mart.
Brands like Charles Shaw winea. k. a. Two-
Buck Chuck (after its incredible low price)
It is available at gourmet grocer Joe\'s, where customers can take a dozen boxes at a time.
They are Target\'s Michael Graves family of household goods, and an estimated 50% of the products are private brands, grocery giant Kroger has made 4,300 kinds of food and beverages in 41 factories it owns and operates.
There is more to be done. 7-
Eleven has launched its own beer San Diego, brewed in El Salvador, aiming to steal market share from imported Corona from Mexico.
Barnes & Noble recently expanded the mark on its storebrand books.
Rite Aid will add about 250 private-
This year\'s label, pure springs and 411 of some new brands.
One of the two ceiling fans sold in the United StatesS.
It is Home Depot, most of which is its Hampton Bay brand.
Dan Stanek, executive vice president of consulting firm Retail Forward, said it was once happy to act as a passive landlord for shelf space, \"retailers are now becoming brand managers . \". Private-
Of course, the label item is not fresh and has been around since A & P had A large number of coffee plantations in South America.
As early as 1930, a new magazine called Fortune, commenting on the struggle between retailers and manufacturers, pointed out that \"there is no issue other than the ban that has been discussed more fiercely.
\"But there\'s a big difference this time ---
Start with the product itself.
Imagine thosename, black-and-
A white can that simply labels beans?
Instead, imagine a slender bottle of Harvest Moon asparagus spear from Texas food chain H-E-
B elegant label (
The crescent is very soft, o\'s interlocking)
This makes the Del Monte can sitting next to it look cheap-
20 cents cheaper than harvesting the moon.
The quality can also be better: take Winn-
According to Consumer Reports, Dixie sold more chocolate ice cream than Breyers.
Or Kroger\'s chips, better than truffles and Pringles--for less money. Wal-
Mart employs a creative team dedicated to designing logos and writing marketing copywriting, while everyone from Carrefour, France and Wegmans, Rochester, NYY.
Developing brand plans that emphasize quality, image and innovation-not just price.
\"Get rid of the term\" private label \", said Merrill Lynch analyst Mark Husson . \".
They have an independent personality.
They are brands.
\"Retailers like this trend.
Because of the low overhead, the marketing cost is zero, private-
The average profit margin of label products is 10% higher than that of brand products.
But more importantly, a trusted store brand can distinguish a chain from its competitors.
Shoppers will drive a mile more to Costco to buy corkland cashew nuts and fill their shopping carts with other items.
The number looks good for retailers as well. According to A. C.
Nielsen, unit sales of stores
Brand Goods Growth 8.
6% in the past two years1.
National brand 5%.
All in all, one out of every five items sold in the USS.
The store is now a store brand and sounds a lot-
Until you know that this ratio has reached 40% in Europe.
Consumers here are increasingly enthusiastic about them.
A 2001 Gallup poll showed that 45% of shoppers prefer store brands, compared with 31% in 1996.
If your job is Duracell\'s brand manager assistant, these numbers will keep you awake at night.
\"It\'s wrong to think that store brands are not\" real \"brands,\" said P & G chief . \"G.
Refuli said in a speech to employees on February.
\"In some categories, these brands are more competitive than traditional brands. \" (
The most important consumption of NeitherLafley or managers
The company will comment on the story. )
Refuli\'s actions clearly demonstrate the urgency of the threat.
While a flagship like the tide is still attractive to shoppers, second
First-line P & G products like Era detergent are in a completely different world of harm: P & G slashed its advertising spending on Era from $13. $9 million to $5.
According to TNS Media Intelligence/CMR, it was 3 million last year.
Meanwhile, rival Unilever has taken its brand from 1,600 in the medium term
1990 to 200.
A spokesperson explained that \"all of our innovation and marketing support\" will focus on leading brands such as Dove, Hellmann and Lipton.
\"The future is three futures,\" said Ken Harris of Cannondale Associates, a consultant for consumer packaging. goods makers.
\"Either you are one of the three big brands or you are out.
\"However, even if they pounce the stables on the strongest horses, many brand makers are looking for a back-up strategy.
A few years ago, a Gillette executive equalled private production
Label the razor as \"Sell Your Soul.
Now Kraft, Nestle, KimberlyClark, H. J.
Heinz, Del Monte, Unilever and others have selectively adopted the strategy of \"join them if you can\'t beat them.
\"Brand manufacturers will not [10 or 15 years ago [make]
\"Private labels, or, if they do, they lie,\" said retail consultant Bill Bishop . \".
\"More and more people today have such strategies.
Even Campbell Soup-
Its classic label by Andy Warhol in 1960s-
Soup for European retailers.
\"Many of our products are made by people who pack national brands,\" said Bill Moran, CEO of 1,170.
Store \"value-added\" chain preservation-a-Lot.
\"We have to be careful how to tell people that. For instance, [ConAgra\'s]
Canned pasta products in Chef Boyardee bag.
They don\'t want you to know.
\"P & G also doesn\'t want you to know that it\'s making other people\'s brands. But it is.
Quietly, until now, discovered by the outside world-
Including analysts tracking the company for years. -
Its paper products department has been producing stores-
Brand toilet paper and paper towels in Europe. (
It has done so in the United States. S.
In the past, but no longer. )
A spokesman for the Charmin and Bounty manufacturers stressed that this is a \"tiny\" part of their business ---
Its home care unit is less than 5%, and analysts estimate $4 billion. -
It produces private labels just to fulfill the contract to acquire the company or to maximize the output of the plant.
This makes sense: P & G needs to keep its work fully stable.
Still, the world\'s leading brand company would even consider lowering the position of subcontractors, which speaks volumes about the seismic changes that are taking place.
Now the shift in the role seems to have been completed: grocery giant Albertson has appointed a \"vice president of corporate branding\" to launch a senior brand called Essensia.
Later this year, we will learn about its advantages, when the TV show of \"Everyone Loves Raymond\" star Patricia Heaton is broadcast.
When the store brand entered the golden age, the situation changed.
This change can be attributed to the fact that the retail sector has been consolidated and the media sector has broken.
In the golden age of brands, the three television networks provide brand giants like Colgate with direct access to the American public.
But with the development of mass media,
Batch size is 1,000-
Worst nightmare for Direco-500 channels, DirecTV, blogs and mass marketing companies-
You can\'t see so many Colgate ads on TV.
In short, brand manufacturers are losing contact with consumers.
Bishop Willard consulted 80% of the decree found in three television commercials in 1995-to 49-year-old women.
In 2000, only five years later, 97 advertisements entered the same group.
Advertising agency Doremus concluded in a recent newsletter: \"In addition to being involved in scandals, it is almost impossible to get your name on enough channels to build substantive awareness.
\"At the same time, guess who is in direct contact with more and more American consumers?
This is correct, the \"mass channel\" because large supermarkets are well known in trade.
Retail Integration into several big-
Megachains said that the ten largest manufacturers accounted for about 80% of the average manufacturer\'s business.
About 30% a decade ago.
Now it is the mass channel that attracts a lot of marketing money, not the mass media.
Almost 60% of the manufacturer\'s marketing budget is so-
Trade expenditure (
Shopping announcements, advertisements in merchandise display)
According to Cannon Dale, compared with 36% 20 years ago.
In other words, the news is double bad news for manufacturers: not only have your customers launched their own brand, but more and more people are managing your brand.
Looking for a big TV audience to sell your new deodorant? Try Wal-Mart\'s in-
The TV screen of the store, which is said to have 100 million shoppers per month.
Do you want to sell your new cupcakes?
Let Costco prepare a batch of snacks for customers when they shop.
That makes you want to know-
When Forester Research came to this conclusion in the 2002 report: \"Wal-
Wal-Mart will become the next P & G company.
\"It sounds incredible. don\'t discount it.
P & G\'s Lafley often talks about the fact that customers are actually two separate people: consumers and shoppers.
His logic is that P & G\'s job is to provide consumers with gold that they want a given product.
The retailer\'s job is to make a deal with shoppers.
However, here, I can\'t go to the No. Lei Fuli: 72% shop that buys decisions, does not watch TV, clickof-
International advertising procurement
Time is not on his side: the longer the store brand is on the shelves ---
Ol\' Roy started in 1983. -
Shoppers become more comfortable with it.
So when merchants act like marketers, marketers like P & G are forced to act like marketers. . . merchants.
A strange but increasingly common sight is that Fortune 500 CEO mumbles about the location of his product in Aisle 4 . .
It was found that refuli was thinking about Procter & Gamble\'s Swiss floor cleaner at a Greek department store. Visiting a Wal-
Last fall, Newville rubber CEO Joseph Gary showed the company\'s sharp pen in a large number of stores in Matt, Maryland.
Hasbro CEO Alan hasenfeld keeps track of targets and Wal-Mart\'s accessMarts.
\"One of our very important jobs is to find out how to get more people into the store,\" Hassenfeld said earlier this year . \".
If the decision maker\'s crest, PaperMate, I . E.
Doh is fighting for shelf space and it\'s easy to imagine what life will look like for a smaller person
Well-known brands like Madame
Frozen seafood from Paul
It gives a new meaning to the term shelf life.
Frank Weise, the CEO of Frank, let the store-
Branded soft drinks including WalmartMart\'s huge-
The option to sell Sam, he said he mainly smashed from Orange, Shasta, and hired a root beer to steal market share.
\"You can\'t see them anymore,\" he said . \".
You can\'t see the painkillers Nuprin from Bristol-Myers Squibb --
Tennis star Jimmy Connors once screamed for squab.
It was caught between adville and the store. Brand ibuprofen.
\"This is the wedding \".
So what happens if your company\'s entire strategy includes driving Nuprins and orange presses?
Ask Aurora foodIn the mid-
1990 it has the idea of acquiring the \"orphan brand ---Mrs.
Butterworth and Log Cabin Syrup, Duncan Heinz cake mixture, frozen fish from van de Camp-
And give them the love they don\'t get from their caretakers.
Although initially praised by Wall Street, the company quickly discovered that it was moving backwards to the future: what orphans really lack is the love of retailers, not the love of marketers.
Retail giants want to deal with happy Green Giants, who are not a group of cute but underweight orphans.
After searching for an orphan\'s home in vain-
Oh, yes, seeing its CEO jailed for securities fraud-
Aurora announced its bankruptcy recently. (
It will continue to do business during bankruptcy. )
Once in a while, a drift will come back to its parents.
In the most recent 1990 s, P & G dropped its White Cloud toilet paper label and focused on a stronger Charmin.
That makes sense--
Until the attention of an entrepreneur named Tony gebart, due to the useit-or-lose-
It policy to manage the trademark, P & G\'s claim for the Baiyun label has been invalidated.
Gilbart immediately bought a song for Wal-Mart.
Register the rights of the Baiyun label. Today Wal-
Matt\'s aisle is full of white cloud toilet paper and even diapers ---
As one observer said, this is an \"Undead\" brand, which gives P & G an unenviable difference in having to compete with the label it creates.
You don\'t think that a tendency to disperse like this can be traced back to one person.
And then you saw Dave Nicole.
Imagine a grumpy Dave Thomas with a law degree, a Harvard master\'s degree, a lifelong foodie enthusiast\'s belly and self-matching.
\"Where are those soft-shelled crabs?
\"He growled at his assistant from the heavily wooded living room.
In the solemn South Forest mountains of Toronto, Nicol re-created a tropical resort with fountains and palm trees, which is a big-
TV screens penetrate animals.
Tonight, he is not only a storyteller, but also a chef.
\"This is the wine in my own vineyard,\" he called, poured a glass of Cabernet Sauvignon for his guests, and went deep into his story.
After working at McKinsey for a while
Nicholas was hired by the Canadian grocery store owner Loblaws in 1972, and three years later was appointed president of the supermarket.
\"I started to run Loblaws like other retailers in North America, which made people buy Coke in stores and leave for less than cost.
I remember one time I ran chuck steak for 99 cents.
I killed every cow between here and the moose chin . \"
\"This is a disaster.
I ended up saying, \'This is a fool.
\"It\'s time to make a new plan.
Nicholas remembers how Marks & Spencer, a London retailer, launched its own store brand St.
Michael is not only cheap but also of higher quality than leading brands.
\"It\'s stuck in my head,\" says Nicholas . \"
Label inspiration from J. uk
Aldi in Germany and Carrefour in France.
He began offering branded counterfeits in 1978. (
He got the idea from Carrefour. )
\"I came in year 56, except to walk into the people\'s living room and say, \'Here\'s a basket of $150 national brands, the same product for $100 with no name.
If you don\'t like it, we will give you the national brand for free.
No name is a commercial success. -
But Nicole doesn\'t like canned vegetables. \"I was food-
\"That\'s where my passion lies.
So I started making products. \" The first--
He called it a coffee of the President\'s mixed coffee, a beer that was sold in a top restaurant in Toronto ---
Good, but nothing compared to the ambition of his next project.
Nicole will bake the world\'s most delicious chocolate cookies.
It took him two years.
The prototype replaced the hydrogenation coconut oil with real butter and the artificial potato chips with high-quality chocolate, but the final formula was like this: Nicholas said: \"I\'m trying to find the maximum number of chips you can cram into the cookies. \".
\"It turned out to be 39%.
The chip of Ahoy is 19%.
\"Products coming out of the lab ---
Nicole calls it decadent. -
Not just delicious;
It was really delicious.
It swept across Canada and became Canada\'s largest seller in a year or two.
Shoppers began to notice.
If you like my chocolate
\"You will really like my cereal,\" recalls Nicholas.
\"He\'s doing the same thing here:\" Kellogg has two scoops of raisins, so I said, \"twice the number of raisins we have.
Oh, yes, cheaper.
This strange idea-
Store brands with better quality than national brands--
Just one of the first series.
His next one is related to packing. Toronto-
Headquartered in Cott, also at the time
Run in soda and make the president\'s choice of Coke with the formula of RC Coke.
Don Watt of the bag
Design experts then teamed up with cott to take the logo for the president\'s choice of Coke and simplify it to a simple, highly stylized \"PC \".
\"This new visual representation has become the next wave, with sales soaring from 680000 boxes per year to 2 million boxes,\" recalls Watt.
Nicole\'s next brainstorm was to export the president\'s selection to North America, so he invited a man named Tom Stephens, A deal was signed with the local grocery store owner, like d\' agostino in New York and Jewel in Chicago.
He told them that a strong brand store would free them from the tyranny of manufacturers.
Stephens recalled that many American grocers scooped at it, calling it a \"Canadian madman \".
\"Chose the president\'s shop,\" he said on a plate of risotto in the quiet Toronto trattoria, \"either desperate or brilliant.
Stephens said: \"The 15 chain stores in the forty-four, 36 states carry the president\'s choice.
About 1990, Nicole came to Sam Walton\'s office like this.
Walton\'s offer is simple: he doesn\'t want to have a presidential choice in his store.
But he can use the expertise of Nicole and his team to develop a private-
Wal-Mart\'s label strategyMart?
The original proposal by Nicholas was a radical one: to set up a Sam Walton innovation center dedicated to new customers
At the same time, although the product development purchased faded, but still-
Resonance brands like detergent Purex. Wal-
Wal-Mart can flood every category and dominate it with its own brand. \"If Wal-
They will rule the world, \"said Nicole. Wal-
Wal-Mart rejected the offer because it insisted-and still does--
It needs a national brand to attract customers.
\"Food business in the United States. S. --
\"They should thank God when they pray, and I didn\'t convince them that it was a road,\" Nicol said . \".
But the actual results are big enough. In 1991, Wal-
According to the president\'s choice, Wal-Mart launched its premium Sam Choice brand.
Two years later, a store brand, even cheaper, was on the shelves.
According to private label Magazine estimates, in 2000, the company devoted a whole page of its annual report to its store brands, which now account for 40% of total sales.
This stable includes nose spray and ibuprofen, premium beef jerky and bleach, Spring Valley vitamins, tuna of Sam\'s choice, and of course Ol\' Roy.
\"Everything a brand will do, we have to do it,\" said Wal-Mart\'s Bob Anderson . \"
Brand food, which helped launch great value in 1993, is now pushing the brand to China. While Wal-
According to an analyst\'s estimate, Wal-Mart will not disclose the sales of its store brands.
Wal-Mart is responsible for 75% of store growth
Brand sales last year.
There is no doubt that Nicol knows what he helped create and he sneaks into a delicious soft dinner
Crab shell and yam, washed down with some of his wine.
\"When you think of a private label in North America,\" he took a bite, \"you think of Dave Nicol.
\"Where will it stop? When Wal-
Rayovac CEO David Johnson, who called the competitor EverActive in 1999, predicted the store --
Brand share will remain below 3%.
Sales reached 8% in three years. -
\"I think this is where they are going,\" he said on last December. 8% to 10% . \". \" Tops.
But as every line in the sand is like this, the manufacturer finds that they are no longer moving.
They can never compete with store brands on price.
Now, many of them also cannot compete in quality.
So apart from entering the private sector
Label production, how do you compete with store brands?
One answer: you don\'t.
You find other goals. -
Like $600 for a dentist.
That\'s what P & G did --it-
$25 yourself (
Sell under crest umbrella and rotate brush with same success)
Clayton Chris Tenson, a professor at Harvard Business School, pointed out.
And the main strategy of Lafley--
Re-focus on 12 Super brands such as Iams, Pantene and Pampers and sell them ---
The result of cheering.
P & G\'s shares rose in dividends-
Adjusted 34% in the past two years.
P & G and other companies are better off moving forward.
The cycle of innovation after imitation is faster than ever before.
In fact, the White Wolf is now fighting Colgate and the store --
Brand whitening gel.
The manufacturer\'s reliance on old standards raises another question: why do we buy brands?
Most importantly, this is about trust.
There are also intangible qualities of desire.
For the 40-year-old Suzanne Maclean, store brands evoke memories of growth without luxury goods.
But there are already signs that the store
Brand stigma is disappearing.
First of all, shoppers are focusing on quality ---
In 2001, Gallup poll showed that the quality of seven stores in ten is equivalent to or better than that of national brands. Trust?
Customer trust Walmart
Matt\'s nasal spray is enough to stick to their nose. Aspiration?
What\'s going on with this: \"I really like the Michael Graves brand,\" 32-year-
Old Jean Trudeau in HillsboroJ.
\"I \'ve gone out of my way to see if they sold what I wanted.
\"Most store brands will never reach the heights of Roy and Michael Graves: brands are a tricky business, art is as important as science, and brand loyalty is hard to meet.
\"Home brands don\'t appeal to me,\" says Susan Gifford, 46 . \".
If she changed Rite\'s store brand \"sandwich cookies\" to Oreo, her children would be surprised.
But if you listen carefully, you can almost hear the movement of the plate.
\"I must still feel ---
I suspect it\'s wrong. -
Quality of shop-
\"Brand products are not high,\" she said . \"Her self-
Questions deepen when she thinks about how the Target brand is attracting her.
\"If they sell in another store, I might even buy it,\" Gifford said . \".
\"Think about it now, I might try a lot of store brands and see how much we like them and I\'ll stick to it if they\'re as good as they are.
When asked why she doesn\'t try now, Gifford has an answer that is to put the fear of God on the most self
Have brand manufacturers: \"Good question. Maybe I will.
\"Feedback mboyle @ fortunemail.