Private brands are evolving beyond the traditional role of acting as generic entry-price options, and are becoming major assets for retailers.
In European markets, private brands have been used by food retailers to connect with consumers while improving profit and revenue. Though private brands have risen in popularity in the US in recent years, a significant opportunity exists for further market penetration. There are a number of lessons American retailers can learn from their European counterparts. When building out a private brand strategy, retailers should consider the following themes:
- Rising consumerism has led to wider demand for innovation
- Private brands can serve as a mechanism for differentiation, by allowing retailers to connect with consumers faster and better
- Through a clear focus on brand building, retailers can define themselves more clearly and control what they are “famous” for
- The economics of private brands can be game changing
There are many winning approaches for private brands. Once retailers have assessed their strategic priorities and the opportunities in their markets, they can harness the full potential of private brands as an asset.
