Unique Benchmarking Strategy Boosts Private Brands 

By Lynne Cooke

Many CPG observers believe that private brands will be in a stronger position following the coronavirus pandemic. The key will be how well retailers and their suppliers adapt to shopper needs that are quickly changing.

With that goal in mind, two companies have jointly launched an innovative marketing approach to enhance store brands in the post-pandemic era. Solutions for Retail Brands (S4RB) and Consumer Science have jointly launched a comprehensive new benchmarking strategy called “Consumer Experience Score.” The approach involves a novel, holistic metric incorporating attributes such as design, packaging, sustainability and healthfulness, as well as traditional sensory and performance measures.

The partners believe that retailers leveraging this strategy, coupled with price comparisons, will benefit from enhanced insights compared to traditional methods. The latter compare private brands primarily to national brands, or analyze only basic sensory attributes, or just one category. The new framework will let retailers test a broader range of attributes against a wider variety of private brand and manufacturer brand competitors. This approach is designed to help retailers to pivot quickly for changing consumer preferences, whether for value, premium or other directions.

During the coronavirus period, private brands have benefitted from more consumer trial driven by manufacturer brand out-of-stocks due to shortages driven by panic buying or other factors. The notion that shoppers will seek more value items in the post-pandemic era is not necessarily the case, or it may not be true in all cases. To compete effectively with name brands, retailers will need to employ improved private brand benchmarking approaches to ensure that all products consistently deliver against their brand propositions.

“Consumers will be more interested in private brands going forward, so this is an ideal time for retailers to boost benchmarking and fine-tune their brand value proposition,” said Chandi Gmuer, Vice President of Consumer Research and Product Testing at Consumer Science. “New kinds of benchmarking are needed to make sure strategies are on target for consumers in this environment, as the discounters Aldi and Lidl did so well back in the financial crisis of 2008.”

James Butcher, CEO of S4RB, said the new approach will enable private brand teams to think differently by delivering against a clear brand value/quality proposition.

“It brings a new standard strategy across multiple categories to help brand owners understand and enhance their private brand propositions,” he said. “This should all be done in a collaborative way so that suppliers can work with retailers to ensure products meet objectives.”

The companies used their benchmarking approach to conduct independent research across a number of private brands, including those from Aldi, Albertsons, Ahold Delhaize, Kroger, Target and Walmart. The research, available from Consumer Science, identified a number of key insights about the state of U.S. private brands through comprehensive testing across multiple categories. Among the insights:

  • The top scoring private brands are consistently providing the best overall consumer experiences at good prices across categories.
  • Some retail brands are challenged by merely average experience scores coupled with higher pricing and disparity in brand value across categories.
  • Some store brands aren’t getting credit for their strong consumer experiences because of less than inspired designs and too-few callouts on packages. For example, in ground Colombian coffee, a category often thought of as premium, products whose designs lacked innovation and seemed outdated received lower Consumer Experience Scores.
  • At times a single attribute, such as texture or presentation, makes a big difference in which private brand items provide the best overall experience in a particular category. For example, the inclusion of croutons in some private brand Chicken Caesar Salad products represented a key differentiator by adding texture and crunch. In the Hummus category, decorative toppings made the difference for some items by boosting presentation.
“Only through deeper testing and comparisons will retailers be able to fine-tune their private brand products to boost consumer experience,” said Gmuer
Consumer Science is a team of quantitative and qualitative researchers in the field of product integrity, sensory perception and consumer behavior. Solutions for Retail Brands is a global, consulting-led software business that addresses complex challenges facing private brand retailers.

                                                                          June 2020
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