Private Label Optimization – Or, Life as a Red-Headed Step Child

Did you know that private labels products now account for up to 45% of all retail sales in key European countries, and 21.5% in the U.S. (Nielsen, 2009)? If you looked at these statistics ten-twenty years ago, it would be a different story. But recently, private label products have become increasingly popular with consumers. Yet, you don’t see these products spending millions of dollars on television and print advertising. Still, in most cases, private label products deliver significantly higher margins to the retailer than the traditional consumer produced goods (CPG) brands.

So, it is surprising that private label strategies are not pursued with the same level of vigor or investment as their branded brethren. Is it because they are completely sold that the only way to spend their marketing budgets is on traditional advertising?

Cult has been working with a large national retailer to optimize their private label product strategy and package design. We employ the same rigorous branding development practices used by the big CPG brands. We conduct deep dives into the lives of the consumers to see how the brand fits into their lives. We employ unique market research techniques to determine what about a private label product speaks to a consumer and pushes them to make the purchase.

Cult Marketing develops concept testing programs to evaluate various design and messaging options, and we have consumers evaluate the competitive products, both CPG and private label. After all, when it’s all said and done, the consumer needs to choose the private label product even when it is displayed right next to the familiar brand icon.

The result is a highly competitive product that can win at the shelf, without a massive marketing campaign. We call this kind of win “the moment of truth” – and if done properly – it can pull the rug out from beneath a billion dollar brand.