How Retailers Can Use Private Brands to Grow Sales

April 5, 2018

Total Retail| April 5, 2018 – When I think about my favorite private brand items, the thing that pops out to me is their “wow” factor. My favorite grocery store has the best ready-to-eat options; my go-to drugstore has reliable, well-priced over-the-counter options; and the coffee shop I most frequent never burns their house coffee. I choose these brands over others because they offer me more than “me too.” They give me something I can’t get anywhere else. That is what private brands are all about.

As consumers look for solutions instead of just products, private brands are becoming more relevant than ever. At the rate they’re going, they’re here to stay.

Consider this: According to Daymon’s research, more than 8,000 private brand items launched in the United States in 2017. This wasn’t an accident. Today’s shopper spends more strategically than before, is less brand loyal and doesn’t think a price-only strategy will cut it. Retailers and brands have responded to this by using private brands to create their own unique, customized and personalized products that deliver on customer needs — not just pretend to.

Here are some of the best private brand strategies being put into action today:

Modernizing Loyalty
To get loyalty on the fast track, the one thing retailers and brands can’t do is rest on their laurels. Instead, they need to modernize their loyalty programs with new incentives and engagement vehicles to drive private brand purchases, especially since 53 percent of consumers say they shop at a store specifically for its private brands, according to Daymon’s Private Brand Report. Hannaford, the Ahold Delhaize-owned supermarket chain, learned this lesson and began offering a private brand-focused loyalty program in late 2017. By creating a loyalty program built around 2 percent rewards on all private brand items and personalized coupons, Hannaford struck gold. Enrolled users now have higher baskets than those not enrolled in the loyalty program.

Connecting Private Brands
Shoppers want more than just another cookie-cutter private brand. What they demand is a brand that’s authentic and deeply connects to its local and cultural roots by engaging in and outside of the store. The whole point of any strategic private brand program is to create touchpoints for consumers across the shopping journey, and this is especially important because six in 10 consumers seek engagement while they shop. Take regional grocery retailer Lowes Foods for example. It has installed “Community Tables” in several stores in North Carolina, featuring homegrown sampling events from local businesses, cooking classes given by local chefs, and more, all in an effort to multiply shopper touchpoints and connect its banner and brand more deeply with its customers.

Creating On-Demand Solutions
Waiting is an activity of yesteryear. Today’s consumers want things on-demand through technology-enabled services that complement and/or supplement their shopping trips. has gotten aboard this trend in a big way with its launch of Amazon Go, the first U.S. automated store sans cashiers or checkout stations. As progressive companies like Amazon continue to disrupt retail and reset shopper expectations, future private brand strategies need to solve for the “I want it now” mind-set given that 81 percent of shoppers say they buy private brands on every or almost every shopping trip, per Daymon’s Private Brand Report.

As you can see, the numbers are in and they don’t lie. With a strategic private brand program, retailers and brands are better equipped than ever to give the people want they want — quality products that don’t break the bank and can be counted on to fit with shoppers’ lifestyles.

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