Store Brands Gaining Ground on National Brands in Quality, Uniqueness

While consumer perceptions toward store brands have slipped on many dimensions over the last two years, store brands may be starting to improve on several product benefits typically associated with national brands, namely: quality, innovativeness, uniqueness and packaging. This is the latest finding from a study conducted by Ipsos Marketing. 

In an annual study conducted by Ipsos Marketing over the last three years, consumers from around the world were asked to compare store brands to national brands on a host of attributes. A three-​year trend analysis indicates the following:

  • From 2009 to 2010, store brands slipped in all areas – with no indications of improvement in 2011 for value, convenience, meeting needs, being good for the family, and being requested by the family.
  • From 2010 to 2011, store brands gained ground in consumers’ minds in the areas where national brands tended to be strongest: quality, innovativeness, uniqueness and packaging.

Our data indicates that store brands still pose a formidable threat to national brands – perhaps now more than ever, “says Gill Aitchison, President, Ipsos Marketing, Global Shopper & Retail Research. “While we might have believed that store brands were reaching their peak during the worst of the recession, it looks as though they are positioning themselves to succeed very well in an improving economy as well.”

Aitchison continues, “It is really not that surprising that consumer perceptions toward store brand quality, innovativeness, uniqueness and packaging have improved. Retailers are investing more heavily into the development and merchandising of their store brands. Not only do store brands offer higher margins versus national brands and help drive traffic, store brands also offer the means for differentiating between one retailer and another. In their quest to make their store brands more appealing to consumers, many retailers have launched higher-​priced, specialty lines – which explains the increase in quality perceptions and the decrease in value perceptions.”

Aitchison concludes, “National brands must now battle store brands on all fronts – it’s not just a value game anymore. National brands must vehemently protect their image for providing higher-​quality and more innovative products than store brands. With retailers focusing more on the product development and marketing of store brands, national brands are going to need to work even harder to differentiate their brands with breakthrough innovations, more standout packaging and true product superiority. Bringing in the voice of the consumer, digging for deeper consumer insights, and leveraging leading-​edge marketing techniques will be instrumental to winning over the shopper at the critical moment of point of purchase in order to win the ongoing battle against store brands.”

[Source:  Study conducted by Ipsos Marketing.  2 May 2012.  Web.  11 May 2012.]