Get The Marketing Message Out

Our retailer and supplier participants agree that a little creativity and collaboration could boost sales of store brand products.

During the past few years, many retailers have enhanced their store brand programs with differentiated products and entirely new brands. But when it comes to marketing these products to consumers, retailers continue to be challenged — at least financially, without the deep pockets of the major national brands.

In an April industry roundtable — held in conjunction with the Private Brand Foods Efficient Program Planning Sessions (EPPS) event put on in Napa, Calif., by Solon, Ohio-based Efficient Collaborative Retail Management (ECRM) — retailer participants told Progressive Grocer's Store Brands about their unique marketing challenges and their strategies to overcome them. And participants from both the retailer and supplier sides also discussed how a collaborative approach could help within the store brand marketing arena.

Our roundtable participants included Victor Alcala, senior manager, fresh/strategic sourcing for The Great Atlantic & Pacific Tea Co. (A&P), Montvale, N.J.; Melissa Billman, director of private label development, Kum & Go, West Des Moines; Alex Chimens, vice president — grocery, the Jel Sert Co., West Chicago, Ill.; Bob Clements, vice president, sales and marketing, Jel Sert; Larry Hamwey, vice president, sales development, Jel Sert; Larry Lamarre, vice president of national accounts, Jel Sert; and Linda Weems, executive director of team sales — center store, Save Mart Supermarkets, Modesto, Calif.

Retailers get creative

Our retailer participants agreed that marketing their store brands on a limited budget can be difficult.

"It's always a challenge because there's just not enough money to compete with the name brands, so you have to be more creative in how you approach it," Weems said. "And it's always a fine line between managing the [national] brands and your marketing programs and managing private label. You don't want to be short-sighted and turn down funding from [national] brands, as that's where you're going to have the competitiveness in the marketplace."

In addition to including some store brand items in its weekly ads, Save Mart runs a number of own-brand promotions in conjunction with the national brands, Weems explained. For example, the Save Mart 350 Race program each summer allows for a number of on-pack promotions around cars and racing. The retailer opens those on-pack promotions to both store brands and national brands, while asking key national brands to help fund the program.

As a convenience retailer, Kum & Go doesn't send out weekly flyers, Billman noted, so it needs to find other ways to get the word out on its own brands.

"We use sponsorship funding that allows us to drive our brands along with the Kum & Go brand itself," she said. "And we target those sponsorship events to our target audience," a younger demographic spanning ages 18 to 34.

Although A&P still prints a weekly flyer that often showcases store brand items, Alcala said flyer usage is on the decline among the retailer's shoppers, many of whom live in the densely populated New York City area.

"People don't have the space and the luxury to carry a basket in one hand and the flyer in the other hand," he explained. "We are working on that. We're also working to have cart handles in some of our stores [with laminated ads] so shoppers can see the offers of the week."

And social media is increasing in importance as a store brand marketing tool, all retailer participants noted.

For A&P, social media is very important, Alcala said. The retailer's younger consumers, in particular, don't really want to be bothered with a paper flyer.

"Social media is actually a way you can hit a targeted audience with respect to your brand," Billman said, noting that Kum & Go has done some social media marketing related to its Java Ridge Coffee and other store brands. "We actually have a social media manager — we take a lot of things in-house at Kum & Go; we're progressive in nature. … We're on Facebook; we do some different bounce-back coupons and other things to create loyalty."

Weems noted that Save Mart, too, recently made the jump into social media.

"Social media is actually a way you can hit a targeted audience with respect to your brand." -Melissa Billman, director of private label development, Kum & Go

"We hired a new, savvy marketing director this year," she added. "Social media is part of his generation and part of his culture, and he is charging his whole department to be of that same mindset."

Under the new marketing director's lead, Save Mart, which does not have a loyalty card program, sent out an e-mail blast containing a special coupon and inviting shoppers to come back for a special one-day Leap Year Day sale this year, Weems noted.

"And it worked — it was a modest redemption; I think we had 3 percent redeemed on a very small base," she said. "But we did get customers in using the coupon, and we got people kind of buzzing about it. So now he's building on these types of small successes."

Recipes featuring store brand products as ingredients make for another creative marketing tool. For its part, Save Mart publishes such recipes on its website, Weems said, and also includes them within its quarterly In Good Taste magazine.

Although A&P also publishes a magazine with recipes featuring store brand ingredients, Alcala noted that the retailer now is working to develop a smartphone recipe app, too.

"I think the good thing about technology is that you can get so much information from your phone," he said.

Stress employee engagement

Perhaps the most important assets to leverage for own-brand marketing, however, are store employees. That's why Kum & Go takes the time to educate its associates on all of its store brand products.

"Your associates must try your products," Billman stressed. "They have to fully understand the brand, who the brand competes against and be able to sell it to the consumer."

Weems agreed, noting that in-store employees should serve as the ambassadors of a retailer's own brands.

"A couple times a year, our company offers a discount card on the 'our brands' items to our employees," she shared. "It's a reward, because they get to buy [the products] at a discount, but then they also become more knowledgeable and able to speak about them."

Collaborative approach

Retailers could work with their private label suppliers, too, to get the store brand marketing message out. The process starts at the planning stage, Hamwey said.

"Sharing your objectives, strategies and annual plans with a manufacturer is very beneficial," he stressed. "Some customers are very good at articulating their goals and challenges in developing their store brand franchise. If we have this information early, we can be in a better position to help them meet their sales targets and category penetration goals."

In a perfect world, Clements added, every private label program would include an accrual program established upfront to fund marketing efforts. Too often, he said, a retailer drives to get the lowest possible net price when initiating a private label program, then later realizes it needs funds to pay for marketing programs to drive awareness and trial.

"That accrual program should be a joint understanding and agreement between the manufacturer and the retailer of what drives the business," he said. "For instance, a retailer might have a need to use some of the funding for a back-to-school promotion. As a supplier, I would be in a position to support the store brand promotion with a display vehicle like a shipper that would be funded with the money that we've set aside in the accrual."

But retailers must be assured they get something back for that money, Alcala emphasized, pointing to a chicken product A&P recently paid $200,000 for — and received nothing but the product in return.

"We want you to make money," he told the suppliers, "but we also want to be fairly treated in what we pay for."

Chimens refers to such fair treatment as "honest collaboration" — where both parties are forthright with each other from the very beginning of a project to the end.

"For example, if both parties know upfront that there is a $100,000 annual marketing fund, then programs can be planned and monies audited throughout the year," he said. "Therefore, if you need $10,000 to support a scan-down or something, everyone should know what the balance was before and after the program."

In that way, Chimens noted, both parties can move forward and work together to drive sales of the store brand product and sales within the category.

"It's a partnership, a full partnership," Lamarre emphasized. "You have to work together and have open communication on a regular basis to really make it work."

The retailer has the ability to use any part of the store to drive private label sales, he added, and suppliers not only could support display programs, but also potentially could supply product for in-store sampling if that program is built into the planning stage.

And retailers also should be more willing to ask for help and advice from their store brand suppliers, Hamwey suggested. For example, Jel Sert's marketing department has a wealth of consumer research it could share with retailers that are trying to better understand shoppers' needs and wants.

"Let us share with you our research and knowledge of where the consumer is going," he suggested. "This information can help your store brand be out front leading the category."

"A couple times a year, our company offers a discount card on the 'our brands' items to our employees."

-Linda Weems, executive director of team sales - center store, Save Mart Supermarkets