Build loyalty with private brands
A strong store brand program is a critical tool in building shopper loyalty to a specific retailer, agreed retailers participating in an April 15 panel discussion during the ECRM Private Brands Foods and Private Brands Health & Beauty Care Efficient Program Planning Sessions (EPPS) from Solon, Ohio-based ECRM. The panel, moderated by Kathie Canning, editorial director of Store Brands, included Andrea Collaro, director of private brands — OTC for Deerfield, Ill.-based Walgreen Co.; Rodrigo Korenblit Olave, manager of private label for Santiago, Chile-headquartered Cencosud S.A.; Adam Swallow, senior brand manager for Walgreens Boots Alliance in the UK; and Jay Warner, store brand category manager for Good Neighbor Pharmacy/AmerisourceBergen Corp., Chesterbrook, Pa.
Private label has become increasingly important and forms the core of Boots' and other UK retailers' loyalty-building activities, Swallow told attendees.
"It's something that consumers are expecting more and more, and it's absolutely a reason for them to come into our stores and choose our stores over our competitors', " he said.
For Walgreens, value and product differentiation really drive loyalty, Collaro noted.
"So you're creating products that customers can only get at your stores, which should drive product innovation," she said.
For its part, AmerisourceBergen considers store brands to be the foundation of its Good Neighbor Pharmacy front-end offering, Warner said.
"Beyond that, they allow a stronger emotional connection between patient and pharmacist," he added. "And ultimately, they're a vehicle that helps us turn patients into shoppers."
Although Olave said Latin America trails both the UK and the United States when it comes to private label program development, he noted that private label is becoming increasingly important to retailers there as a differentiation tool.
"What private brands can give, national brands cannot give," he said, "and that is those specific products that satisfy consumer needs that only you have and not the other retailers."
To determine where and how to innovate and differentiate, the panelists said their companies look to their specific shopper needs. For Walgreens, that means talking to customers to understand their unmet needs or the white space in specific categories, Collaro noted.
"It's not really a cookie-cutter approach," she said. "It's really about listening to the customer and developing products that meet their needs."
Olave agreed that meeting shopper needs is critical. He pointed to two recent customer-centric innovations from his company: a breakfast cereal featuring stevia and a cereal packaging change, from box to bag, that made the product more affordable to shoppers.
Warner said his company is better able to use data today to get the information needed to innovate and differentiate on the private brand side.
"I think the way we are able to use data today to manage our store brand as a brand, to understand consumers [and] demographics, to come up with specific programs for stores in specific geographies is the best way for us to build loyalty programs as opposed to having one cookie-cutter approach," he stressed.
And for Walgreens Boots Alliance, differentiation goes beyond shopper insights to guide product and packaging development, Swallow noted. The company rolled out a training program in Boots stores that is specifically focused on private brands.
"We're educating the teams in stores as to why our brand is so beneficial to our customers," he explains, which means the teams then are able, in turn, to communicate the benefits of the store brand directly to shoppers.
Note: Photos, left to right: Andrea Collaro, director of private brands — OTC for Walgreen Co.; Rodrigo Korenblit Olave, manager of private label for Cencosud S.A.; Jay Warner, store brand category manager for Good Neighbor Pharmacy/AmerisourceBergen Corp.; and Adam Swallow, senior brand manager for Walgreens Boots Alliance.