Food Lion sees strong growth potential in store branded perishables — especially in categories such as bakery, dairy and deli — two of the company's executives said during a conference panel in Chicago.
The company devoted some 18 months to reconceptualizing storewide private brand offerings, and the next phase will be working with suppliers to foster growth, according to comments at the 2015 Private Label Trade Show in Chicago, sponsored by Private Label Manufacturers Association.
"At this point deli, dairy and bakery show great opportunity in private brands," said Paula Summers, director of marketing, Food Lion, based in Salisbury, N.C. "Consumers are shopping the perimeter, and we need to reach out and give them what they need. It's such a rich opportunity."
Much of the chain's private brand efforts have focused on three brands: Food Lion, which meets everyday needs with national brand equivalent quality; Taste of Inspirations, a premium brand; and Nature's Place, which includes products that are 'free-from' a range of ingredients.
The journey to improve private brand positioning has differed by perishables category, as outlined by Heath Osburn, director, Our Brands, Food Lion/Delhaize Group.
In bakery, the retailer until recently had a range of branding approaches, including different levels of quality. More recently the company has put a greater emphasis behind the Food Lion brand, and that strategy will accelerate.
"We're covering the dayparts for bakery, including lunch deli sandwich breads and dinner breads and desserts," he said. There are also other new breakfast offerings, including the "one-bite and two-bite brownies."
On the dairy side private brands are very important to the strategy. "Dairy is one of the biggest places in the store -- and the perimeter especially -- where it's all about private brand. So if we're going to do private brand well, we have to make sure we have a very strong dairy program," he said. Shoppers were somewhat confused with the prior strategy, so "we cleaned it up with our strategic assessment." The retailer focused on everything from package redesign to new consumer tastes.
Deli has started to reflect a transformation on the private brand side. Previously Food Lion experimented with a range of brands. "But we realized we have a powerful brand in Taste of Inspirations; we control the quality standards for that brand and the offerings." He added that deli is a big contributor to the chain's growth and "a place where private brand offerings have helped to lead the way."
Food Lion wants to work with supplier partners "to build on this perishables momentum and partner with many of you," he said.
Other speakers during this session were Lee Smith, publisher/editorial director, Deli Business, and the moderator Robert Vosburgh, news director of PLMA Live!
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