Wegmans puts its private label to the test, literally. In blind taste tests conducted in-store, it lets customers decide which tastes better: the leading brand or the store brand.
More than a dozen private-label items have already been selected as better. They include W Os cookies, Aqua V Lemonade Vitamin Water and Food You Feel Good About chunk light tuna in water. All are highlighted in-store with shelf signs reading “Great Taste Wins.”
In cases where the store brand is not preferred, Wegmans takes note of the feedback and works toward product improvement.
The unique strategy underscores Wegmans' commitment to its store brands and helps explain why sales of its own brands have risen about 11.5% over the past year.
Wegmans is not alone. Private label now represents 26% of Kroger's dollar sales and 33% of unit sales.
Such strong performance is part of a larger sales trend (click on "Economic Stimulus" to read the story). Private-label sales in food, drug and mass merchandisers, including Wal-Mart, climbed 10% to $82.9 billion, up from $75.1 billion a year ago, for the 52 weeks ending Nov. 29, 2008, according to Nielsen. What's more, unit sales, which had been flat to declining, grew 2.2% to 38.2 billion in total outlets for the same period.
True, the economy has helped. But retailers have invested heavily in product development.
Wegmans, for instance, has a group of quality assurance professionals who work with its buyers to make sure its store brands compete in value and performance.
And Kroger continually rolls out new products to cater to varied consumer tastes. For instance, it has strengthened its Active Lifestyle brand of nutritionally enhanced foods with new introductions such as bread containing plant sterols to help lower LDL cholesterol.
These and other retailers have set the bar high by leading, not just following, food retail trends. Just take a look at SN's first-ever list of the 20 Best new private-label products (click on "Private Equities" to read the story). There's Supervalu's Culinary Circle lava cakes, as well as Sam's Club's specially designed milk carton that simply needs to be tipped — not lifted — to pour out the milk.
Plenty of other products on the list help make specific chains a destination. Take 7-Eleven's Inked, an energy drink geared to those with tattoos, and Target's new cereal/granola packaging: a bag-free oval container that has a snap-shut lid.
And don't forget the wave of upscale ingredients turning up on the ingredients panel of store brands. From red chard in Wegmans' packaged salad to dried mangos in Wild Harvest natural cereal, there's something for all tastes.
According to a new PLMA survey (click on "Consumer Confidence" to read the story), 82% of consumer respondents agree that store brands are better than or as good as the national brands, up from 66% who said the same thing in 2006.
This kind of response demonstrates how store brands increasingly offer value and quality that can meet the needs of shoppers today and in the future.