Private Labels in India (A): What's in Store?
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Code :BSM0066
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Region : India
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Growth of Private Labels - Global Perspective In the early 20th century, manufacturers of branded products grew tremendously with the increasing use of branded products by consumers. With growing awareness, consumers preferred branded products to inferior quality products from local manufacturers. Led by Procter & Gamble (P&G), Unilever, Coca-Cola and Nestle to name a few companies, manufacturers during the century grew manifold and the products of these manufacturers became popular with consumers. To reach large groups of consumers and market their products effectively, these manufacturers used the electronic and print media. Increasing awareness of brands through advertising influenced the consumers' buying decision and brands soon became the symbol of quality, trust, affluence, image and lifestyle. As a result, manufacturers grew both in terms of value and volume... Private Labels vs Manufacturer Brands PLs are growing by gaining customers and competing with national brands. According to an Ipsos MORI survey, 2006, "41% of consumers said they frequently drop store brands into their shopping carts these days versus 12% in 1991". National brands are not just ideally watching the growth of PLs but defending their growth through aggressive advertisements, innovation and targeting new segments. Ken Harris, MD, Cannondale Associates, Evanston opined that "Brands stand for something. Private label products do not generally lead with consumers, they are fast-followers of manufacturers. This gives brands an advantage"... Expansion of Private Labels Despite tough competition from manufacturing and other retailers' brands, PLs are expanding to other markets. Though at a nascent stage, the market for PLs is positive in developing countries like China, India and Russia and is expected to grow with their strong economic growth in the coming decades. Retailers such as Safeway, Kmart, Sainsbury and Target, etc., are expanding their distribution channels in new markets. Retailer in partnership with other retailer, selling labels of one another in their stores. For instance, D&S in Chile sells labels of Safeway (US) as its premium products line. Even Pizza Express offers its Pizza in the Sainsbury's stores. Retailers are also co-branding their labels with other manufacturers or retailers.... |
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