ASMI - Fight back Private Label

grant me the serenity to accept the things I cannot change; courage to change the things I can;and wisdom to know the difference.

serenitymaking your “peace” with private label

•“Retail aint rocket science...but it burns as much fuel.”

Gordon Segal, Crate & Barrel

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A funny thing happened on the path to value...

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In order to be irreplaceable one must always be different.

Coco Chanel

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5 Trends Driving Retail Innovation

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•1. Authenticity

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When it comes to selective comparability, who’s really in control?

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•2. Clear Value Proposition

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•3. Category Authority

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Category Authority– A Critical Element in Driving Shopper ROI

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There is no such thing as Private Label Immunity

From: Understanding Shopper Satisfaction – Implications for Retailers and Manufacturers, 2008

The Historical Myth About Private Label

• Why Retailers have private label:–Higher margins

• Impact on Suppliers: – Increased competition–Reduced shelf space–Attitude:

“Private label will negatively impact the equity of my brand.”

In Fact, Most “Private Label” Derives Its Value By Leveraging Supplier Brand Equity

But… Next Generation Private Label, Competes on Innovation – NOT Price

Innovate Strip Replicate Adapt

↑ ε↓F ↑F ε

“No Equity”

Strip all branding & identification until

just left with generic product

“Innovation Equity”

Retailers don’t want to compete on price, instead compete on uniqueness & differentiation; communication of the brand ethos more important than

velocity

“Independent Equity”

Retailers take ownership of product; product/ brand stands

on own, not dependent on copycat strategy

“Borrowed Equity”

Competition based on price; value & brand equity comes from comparison to national

brand

Source: MVI analysis

2020

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•4. Store as “Experience Centre”

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“We want thepurchase to bethe souvenir of theexperience”

Peter Williams, ex-CEO, Selfridges

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•5. DiSoMo

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Do you really want to put the voice of customer @ the centre of your

business?

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5 Trends Driving Retail Innovation

• Authenticity

• Clear Value Proposition

• Category Authority

• Store as “Experience Centre”

• DiSoMo

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Serenity Now

• Who’s responsible your brand experience?

• Private label can replace any product at any price point. You need to bring different (measurable) value to retail to endure

Support retailer differentiation that drives growth

• Expect dissonance in retailer value equations, good ones will have functional and emotional drivers

• Don’t get hung up on the “last 3 meters” – the path to purchase is growing longer…and that’s a good thing for you

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You do not merely want to be considered the best of the best. You want to be considered the only one that does what you do.

Jerry Garcia

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courage

“we can’t go on like this”

the great imbalance

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in grocery alone 80% of our business is with 40% of the outlets

then there are another 96,000 outlets on top

of that

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truth is ........ we don't leverage the difference in the 80% we spend most of our time on

channel awareness & availability

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differentiating channels based on profit & ROI

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winning early = getting distribution right

insisting on insight

• distribution intelligence based on demand not supply• NBMs getting well versed

at leading the insight• Making sure we are

asking the right questions

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the effort effect

the measurable talent

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understanding the dessert before dinner concept

creating solutions

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be honest - has the business remembered how to innovate

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the “space age” & the paradox of choice

making brands mean something & then protecting them

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protecting brands through purpose

• leverage occasion to save future innovations from the grocery RIP

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involving the trade

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making “some” history

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and remember how we got here!!

grant me the serenity to accept the things I cannot change; courage to change the things I can;and wisdom to know the difference.

So, Thank You!

Phil BonannoHead of ShopperIdeaworksPhil.bonanno@ideaworks.com.au03.9287.1288twitter: @phil_bonanno

Scott McLaughlinDirector Next Reality Groupscott@nextreality.com.au03.9602.5099twitter: @scottanidea

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