The Best, Extra Special, President’s Choice, Taste the Difference… premium own-label ranges are flourishing as consumers focus on quality as well as price. On both sides of the Atlantic supermarkets are marketing premium ranges to discerning shoppers – but some of the products are identical to standard ranges. Hugh Westbrook finds evidence of rebadging and asks whether it’s all just a cynical marketing ploy.
The nature of the battleground in UK supermarkets is changing. ‘Pile it high and sell it cheap’ is no longer enough, and consumers’ increased interest in food has led to supermarkets developing their own-label, high-quality brands to both satisfy demand and create new marketing tools. The phenomenon seems to be confined to the UK and North America, but the comments of those involved in the development of UK brands offer valuable insights into the marketing strategies of large international food retailers.
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In Britain, Tesco, Sainsbury’s, Asda and Safeway all now produce a premium range, while Marks & Spencer has been producing high-quality own-label food for a number of years. Meanwhile, in the US, Safeway and Kroger have their own premium brands. Longest-established is the President’s Choice label, sold through the Canadian Loblaw group for over 20 years and now numbering some 2,500 products. The label has been such a success that is has recently been used to launch a range of financial services.
Europe is not following suit. Andrew Thomson, Brand Manager of Safeway’s The Best range, believes the continental market does not have “the same language of premium, economy and standard.” Meanwhile, Australian group Coles does not have a specific high quality label. It told just-food.com that it is gradually introducing ‘Coles’-branded products, which while being at the top of their own-label hierarchy do not have a premium price, though there are some premium products within the range.
In Britain, Marks & Spencer has always been associated with high-quality produce. It told just-food.com that it is unworried by the increase in competition. “We think we still lead on innovation and quality of produce,” a spokeswoman said.
So why have the major groups decided to fight on what has always been traditional M&S territory? Sainsbury’s has come very much into public consciousness, using celebrity chef Jamie Oliver to promote the expanding Taste The Difference range. The company told just-food.com that the range was developed due to customer feedback that “quality is their prime concern when shopping for food,” with the consequent increase in price deemed irrelevant.
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By GlobalDataTaste the Difference: not so different after all?
Taste The Difference was launched in November and is described on the company’s website as a “brand new range.” The implication is that all the products included in the range are also new. However, this is not entirely true. just-food.com suggested to the company that certain items such as Taste the Difference traditional beef, Farmer’s Choice yoghurt and Ripe & Ready Avocados were already in store and had simply been re-branded.
While not commenting on specifics, Sainbsury’s admitted: “Although most of the range is totally new, some lines have been rebadged in order to help the consumer. A significant percentage of these were reformulated for the launch.”
just-food further suggested that the Sainsbury’s advertising campaign was misleading, as it implied that the range was made up of new products. The company replied: “We feel this is not the case as the range is a new concept and raising the public’s awareness of the new range was of prime importance.”
Just a marketing ploy?
It is true that a substantial number of new products have been developed for the range, but the rebranding issue certainly makes the cynical analyst believe that the whole quality issue has an element of marketing ploy about it, with existing products simply being reinvented as something new for the unsuspecting consumer.
Sainsbury’s adds that it wants its products to be for everyday use. “Other companies have launched niche appeal, esoteric products. Customers don’t just want quality for special occasions. Taste the Difference is unique in that it is a range of high quality foods which are accessible to everyone for everyday use.”
That claim may be about to change as Asda builds on its reputation for value for money with the launch of Extra Special and additions to the Asda Fresh labels. Director of own-label Catriona Land told just-food.com that Asda’s ability to save money for customers on their everyday shopping left more money available for everyday indulgences, and that trying to understand customers’ needs had been core to developing the brands.
“It’s not about a niche market, we’re trying to think about everyday products,” she said, “For example, cookies are something they can buy every day and they’re really indulgent. “We haven’t gone and copied from other supermarkets, we’ve developed products which are right for our customers at prices which they can afford.” She said that the differentiation in own-label in the store is similar to Asda owner Wal-Mart, which has Uncle Sam as its premium label.
Finding the point of difference
This outlook is philosophically at odds with Safeway. Brand manager Andrew Thompson told just-food.com that “innovative” and “distinctive” products were important concepts for his range. For this reason, the company has steered clear of branding certain products as The Best because it wants to be sure there is a point of difference. “We didn’t want to get into a copying exercise or to get really hung up on the number of products,” he added.
“We’ve had opportunities to expand the range as some others have but we’ve had concerns about whether it really does make a difference to customers. For example, we haven’t included in-store bakery bread; we struggled to really believe there is enough of a point of difference.” He said that fruit and vegetable products, for example, followed very seasonal patterns in order to be distinctive and would not be sold the whole year round as a result. He also admitted that like Sainsbury’s, some of the products already existed and were re-branded, though he hopes this situation will change.
Whichever methods are being used by supermarkets to put their ranges together, shoppers in the UK are being offered higher variety than other places in the world at present. It is worth noting though that whether through original product development, a quest for quality, rebranding or an attempt to offer customers value for money, customers seemed to be faced with an identical range of fresh pasta, quirky soups and fancy ciabatta whichever supermarket they are in.
By Hugh Westbrook, just-food.com correspondent
To find out more about marketing premium food and drinks, click here.
