As an agency focused on CPG marketing, we’re growing more troubled by retailers’ aggressive private label marketing efforts. Retailers are doing it well. And it’s working. Most alarming, though, is that CPG brands seem to be bankrolling retailers’ private label marketing with the investments in trade and shopper marketing that they are obligated to devote to their retail partners. How do CPG marketers change direction and regain control?
Background
CPG marketers know that retailers have realized tremendous success in developing private label brands and that it is a real threat. Among the facts illustrating private label success, Mintel reports:
- Since 2008, the number of premium-positioned private label product introductions has outpaced new premium-positioned products introduced by brand marketers.
- Seven of ten shoppers say they perceive the store-brand food products they buy to be the same or better quality than name brands.
- Over half of shoppers say they will shop a specific retailer because it has good store brands.
What CPG marketers may not wish to acknowledge is the hostile nature of many private label marketing campaigns and their own role in funding them.
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