Mar
1
2010

Brand Names, Now’s the Time to Outshine the Generic

Aw, screw it. Grab whatever's cheapest.

I recently read a thought-provoking article on boston.com outlining how in this long-standing bad economy, more and more shoppers are opting for big box stores’ private label products over their typically more expensive brand name counterparts. Which got this copywriter to thinking about a few things, especially from the perspective of creative development.

My first question is whether any amount of branded advertising is capable of carving out a sense of loyalty in a price-sensitive consumer’s mind right now. Because as one of the peeps quoted in the article said, “I am not loyal to any grocery store or any brand…I am loyal to savings.’’

You see, this trend isn’t just anecdotal, either. According to Nielsen, unit sales of private label goods have jumped 8 percent since 2007, while brand names have declined roughly 4 percent.

The following questions, amongst others, I’m left pondering as I head out to the grocery store with my pockets full of coupons:

  • Can more marketing move more brand name products, or as illustrated in the case of Domino’s “Pizza Turnaround,” do branded products need to be improved before people will reconsider buying them?
  • Are the big brand names of the future only the big box stores like Target, Wal-Mart, Wegman’s, etc. and their private label products?
  • Will brands in the crowded packaged goods category start to disappear as their sales continue to decline, or will they maintain market share by lowering their prices to compete with the private labels?
  • Are consumers reaching the threshold of choice—that is, with so many choices in front of them in the cereal aisle, is price the only differentiator left?

All in all, I think the private label movement is proving yet again that we are in the era of total consumer control. Online and offline, consumers are dictating what brands need to be thinking about, not the other way around. It’s also mandating that if brands expect to get premium dollar for their products, the stuff needs to actually be noticeably better than the generic. Because as the data’s proving, pretty packaging and clever advertising just ain’t cutting it anymore.

Curious how this digital advertising firm can improve your brand and set it apart from the rest? Contact us today to learn more.

Photo courtesy of cafemama via Flickr Creative Commons.

So what do you think?

Brand Names, Now’s the Time to Outshine the Generic

  • http://pointtopoint.com Mark Goren

    Gary:

    Nice post.

    If you were to go back and read brand commentary from every recession since the “branded era” began, you’d find the same doom and gloom written about the future of brands. And in every case, brands figure out how to move past it, get better and sell more.

    Brands help people make decisions. They won’t disappear anytime soon. To your point, they just need to become more relevant. Don’t worry they will. There’s too much at stake. I don’t expect P&G to relinquish their shelf space, profits and loyal customers.

  • Gary Bostwick

    Thanks, Mark. In much of my post, I’m actually playing Devil’s Advocate. I do firmly believe value can be created for brands, even in the Great Recession. However, I believe that when it comes to parity—at least in the consumer’s mind…that is, laundry detergent is laundry detergent—it’s time that brands really start making their products inarguably better than the generic. To me, this is the only way that consumers are going to justify paying a higher price point. And if their experiences with said exceptional brand products are exceptional, that’s where we have the opportunity to create good ol’ fashioned brand loyal customers.