Manufacturer Brand and Private Brand
"To survive in such a competitive market place, companies must build brands in order to create a strong differentiation in the market, attract customers with a credible value proposition and to constantly engage customers in ways that would endear them to the brand and to the company" said Martin Roll, the brand guru. These words encompass the whole ethos behind investment in branding.
Manufacturers with their financial prowess invest huge amount of money to make their brand name visible to the consumers against its competitors. This huge spending, if successful may ensure a strong brand and a loyal customer base.
Successful retailers became inspired by the success of manufacturers and came up with products using their own brand name. This was ensured by outsourcing production activities of their products to other manufacturers. This naturally left the retailers to concentrate more on marketing their product and developing their brands rather than focusing on production. These retailer made brands were known as private brands.
Retailer’s brands gained prominence after the entry of discount stores like Kmart and Wal-Mart during the 1960’s. Retailer brands improved their market share further during periods of recession when lower priced private brands were sought by consumers. But the 80’s, private brands were a force to reckon with.
Private label brands were traditionally defined as generic product offerings that competed with their national brand counterparts by means of a price-value proposition. Often the lower priced alternative to the "real" thing, private label or store brands carried the stigma of inferior quality and therefore inspired less trust and confidence. Yet, they...
... middle of paper ...
... to occupy more than this, then consumers feel that there aren’t enough choices. In countries such as Switzerland and the UK, private labels have reached this limit and these markets have saturated. But they will continue to grow in the other countries till they reach the same level.
In many instances, private labels have surpassed a national brand’s capacity to deliver on visibility, consumer interest, involvement and appeal. Proprietary brand decision makers are often able to command close to parity or parity pricing for their products, without articulating cost as the differentiating factor. This represents a point of departure from the past: there is an acknowledgement that today’s proprietary brands have the ability to transcend the negative baggage and problems of traditional store brands, thereby creating an unique, resonant benefit propositions for consumers.
Today’s society is full of products that have numerous varieties. But, little do customers know about the time before when there was one type of each product. In Malcolm Gladwell’s “Ketchup Conundrum” article, he offers many different situations providing an explanation on how some products came to be, and how some name brands made their way into the business world. Consumers are lucky today that there is almost any variety of product to fit their wants or needs.
People are often deceived by some famous brands, which they will buy as useless commodities to feel they are distinctive. People require brands to experience the feeling of being special. People spend their money to have something from famous brands, like a bag from Coach or Louis Vuitton which they think they need, yet all that is just people’s wants. Steve McKevitt claims that people give more thought on features or brands when they need to buy a product, “It might even be the case that you do need a phone to carry out your work and a car to get around in, but what brand it is and, to a large extent, what features it has are really just want” (McKevitt, 145), which that means people care about brands more than their needs. Having shoes from Louis Vuitton or shoes that cost $30 it is designed for the same use.
More important than product, people, and advertising, branding is going forward as one of the most important factors in a business. While Klein has a bias against branding and wishes the reader a word of warning, in this specific essay she focuses on what branding means for the future. Klein starts off her minor claims with the bloating of corporations. “A consensus emerged that corporations were bloated, oversized; they owned too much, employed too many people, and were weighed down by too many things (Klein 769).” Through the use of branding, these same businesses could cut down all of their problems and payrolls through importing and simply putting their brand name on the product. Then when the dreaded “Marlboro Friday” happened, and it seemed that all brand significance was for naught, Klein showed us examples of businesses that thrived from a new age of marketing. “For these companies, the ostensible product was mere filler for the real production: the brand (Klein 774).” With brand driven marketing rather than product driven sales, businesses soared with selling the idea of their products more than their products quality. Using the example of Starbucks, Klein also supports her claims of branding not through marketing but weaving its name into products and culture. “The Starbucks coffee chain was also expanding during this period spinning its name into a wide range of branded projects: Starbucks airline coffee, office coffee, coffee ice cream, coffee beer (Klein 775).” By spreading its name not through marketing, but through spreading the brand through new and different products Starbucks found success in turning their brand concept into a virus and sending it through cultural sponsorship, political controversy, consumer experience and brand extensions. These forms of image building could make a company like Starbucks successful with branding over
... brands and reducing their reliance on the larger brands. In addition, retailers such as Wal-Mart and Target are increasingly offering private label premium goods at affordable prices. A huge advantage with private label brands is that they can be positioned as a lower cost alternative for national and international brands. Increase in demand for the private label products provides better margin and would generate more business for the group.
However, private labels have strived in the pet food industry as some budget-strapped consumers sought more affordable alternatives to their usual product. New premium brands from Walmart and Target have popularized private labels as pet owners’ desire quality and low price. Brands like Walmart Natural Life and Target Lifelong have gained some share in the
Tanner and Raymond (2014) describe branding activity as “strategies that are designed to create an image and position in the consumers’ minds” (c.6). When branding messages coincide with its offerings’ characteristics, it establishes consumer trust, and brand strength. For example, when first introducing Dove brand in 1957, by labeling its product as a “beauty cleansing bar . . . [with] ¼ moisturizing cream, that rinses cleaner than soap” (Unilever, 2016), we can see that marketers associated the brand to moisturizing and beauty, and disassociated the brand from common soap. Over the years, this consistent message coinciding with product performance has strengthened the Dove brand. Strong brand equity is derived from consistent, strategic branding that establishes perceived quality and emotional attachment (Entrepreneur, 2016); therefore, consumers are more likely to pay higher prices, as well as purchase new offerings connected to the
Where there is rapid growth comes increased competition; similarities in products across manufacturers have reduced brand differentiation across the board. The problem now is the severe rise of copycat companies and manufacturers that copy designs and specifications of cars, and proceed to undercut the original manufacturer’s profit margins. So to improve their brand standing, every manufacturer’s individually have resort...
[1] Aaker, D.A. and Jacobson, R. (1996) Building Strong Brands. New York: The Free Press.
A company’s brand is one of its most valuable assets (Green and Smith 2002). Brands owners invest millions of dollars every year in advertising and promotion to raise awareness and create demand for their brands.
This is based on the fact, that the small market volume does not enable brands a dynamic development of its positioning. At the opposite extreme, there are markets, which are constantly subjected to change in customers’ needs and preferences. The increasing heterogeneity of this kind of markets represents a challenging aspect for a positioning and requires high individualization (cf. Feddersen 2013, p. 54).
Aaker, D.A., (1991), “Managing Brand Equity: Capitalizing on the Value of a Brand Name”. New York: Free Press. P. 134-140
Helm, C., & Jones, R. (2010). Extending the value chain – A conceptual framework for managing the governance of co-created brand equity. Journal of Brand Management, 17(8), 579-589. doi:10.1057/bm.2010.19
... all the existing meanings and definitions of brands are provided. The history and evolution of brands are also looked upon.
A brand identifies a seller’s product from a competitor’s product. There are three main purposes for branding product identification, which is the most important purpose, repeat sales, and new-product sales. Branding has a lot of terms that marketers use there is brand equity, global brand, and brand loyalty. Marketers also have different brand strategies that they use for different products or customers. It all depends on the consumer for them to decide which strategy they will use. The different strategies are generic products, manufacturer’s brands, private brands, individual brands, family brands, and co-branding. The branding purposes and the branding strategy make up the importance of branding.
Early on in the twentieth century, when mass marketing and production became commonplace, company branding allowed consumers to identify with a company. The consumer made a one sided personal relationship