One thing many seasoned shopper swear by is a store brand. Store brands are products that carry branding related to the store they are bought in. They, quite often, cannot be purchased anywhere else other than in those chains of stores. Using store brands is one way that many retail stores and grocers can increase profit margins by competing directly with more famous brands on their store shelves. However, you need to make sure your store brand is attractive and appealing to consumers to succeed.
Compete on Price
One way that many store brands compete against famous brands with million dollar advertising budgets is via price. A store brand version of steak sauce, for example, is likely to be cheaper than more famous brands like A1, Heinz 57 or Lea & Perrins. Most shoppers, except for the very wealthy, are all looking for a deal when they are in the grocery store. As such, they may be enticed to purchase a store brand to save a couple dollars or even less in many cases.
Design Attractive Packaging
In most cases, store brands are extremely similar to other well known products already on the shelves. One trap you do not want to fall into is creating very generic labels, boxes or other packaging. Generic looking products are often associated with poor quality by consumers. Instead, try to raise your game by creating packaging that does a good job of selling the quality, freshness and taste of that product to the consumer. Work with a design agency that has a lot of experience in product packaging to create something that really jumps off the shelves.
Compete on Quality
Store brands don’t only have to compete on price. They can also compete on quality. This is due to the fact that selling your own branded products removes some of the overhead other companies have to deal with. As such, you don’t have to cut corners. If your products last longer, are sturdier or taste better than the national brands do, you can develop a loyal customer base. This has been the case with Trader Joe’s, IKEA and other stores that sell their own branded products.
Localize Your Store Brand
Many retail store and grocery store chains are regional. Jewel-Osco, for example, is found primarily in the Midwest and especially Illinois. One way to succeed with store brands as a regional store is to localize those products to better suit the needs of your customers. This is much more difficult for larger national brands. They have to design products for wide swaths of customers across the country. A store brand, however, can focus on regional products. The Chicago style hot dog, for instance, comes on a poppy seed bun. Thus grocery stores in the Chicago area carry poppy seed hot dog buns under their store brands.
If you run your own chain of stores, using store brands can be very advantageous. For one, you won’t be sending so much of your revenue back to other huge corporations you have no real affiliation with. Instead, you can turn more of that revenue into profit. Competing with those larger brands is not going to be easy. However, using the four strategies outlined above can help even the playing field.
Guest author, Lizzie Weakley is a freelance writer from Columbus, Ohio. She went to college at The Ohio State University where she studied communications. In her free time, she enjoys the outdoors and long walks in the park with her 3-year-old husky Snowball. @LizzieWeakley