USA Today reports on how “store brands are taking on their name-brand counterparts with splashier packaging and a growing number of organic, all-natural and higher-end products. The push is part of a broader expansion of store brands into every corner of the supermarket; shoppers can now find cheaper versions of Greek yogurt, organic frozen pizzas, gelato and even specialty chocolates.”
The story notes that “supermarkets are being pressured by rising fuel and commodity prices, which have forced them to pay more to keep shelves stocked with name brand products. But grocery chains fear passing on those higher costs could send shoppers running. So to keep expenses in check, they're revamping the taste and packaging of their house brands to boost sales. The added benefit is that once shoppers get used to a particular product, they're more likely to keep coming back and try other items in the line.”
One of the byproducts of this shift in emphasis is that “supermarkets can charge more ... prices for store brands on average rose 5.3% in the past year, compared with 1.9% for name brands.” In almost all cases, the store brands are less expensive than high-end options, though not necessarily cheaper than low end products.
The story notes that “supermarkets are being pressured by rising fuel and commodity prices, which have forced them to pay more to keep shelves stocked with name brand products. But grocery chains fear passing on those higher costs could send shoppers running. So to keep expenses in check, they're revamping the taste and packaging of their house brands to boost sales. The added benefit is that once shoppers get used to a particular product, they're more likely to keep coming back and try other items in the line.”
One of the byproducts of this shift in emphasis is that “supermarkets can charge more ... prices for store brands on average rose 5.3% in the past year, compared with 1.9% for name brands.” In almost all cases, the store brands are less expensive than high-end options, though not necessarily cheaper than low end products.
- KC's View:
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I’m always a fan of anything - products or services - that provide a differential advantage because the other guy cannot or does not have them.
