Private Brands, and the power of buying decisions at the shelf

Developing intelligent and relevant retail package design solutions is one of the most cost efficient ways of using your marketing budget to influence the purchase decisions of consumers at retail. At least that is the conventional wisdom of package designers.

The surprising results of a recent Symphony IRI study may make that argument even more compelling, for both retailers and CPG companies.

Apparently consumers have a very different purchase decision pattern for private label brands versus traditional national CPG brands. According to Thom Blischok, global President of Symphony IRI, in a storebrandsdecisions.com piece,

“Two-thirds of shoppers decide on their store brands purchases in the store and at the shelf versus traditional CPG product purchases, which are predominantly (80 percent) decided at home.”

Now that’s fascinating, and these results suggest two things.

CPG Brands need to work harder on the shelf
National brands apparently should put more resources towards identifying why these purchase decisions are made at the shelf and how to influence them with the package and all other forms of retail in-store marketing.

My suspicion is that they will find consumers, when making decisions in the store, are looking for more than a recognizable brand. Certainly price is a factor, but just one factor to consider. It may also be that store brands are doing a better job of communicating other points of benefit or points of difference to the consumer.

Store Brands must continue to expand their offering
One traditional strength of CPG brands has been variety and choice. But the IRI study finds that 53% of customers prefer stores that have a large variety of store brands. The days of having only a couple of store brand choices within each category would appear to be ending, and apparently for good reason.

The good news for package designers is that both our CPG and private label clients are beginning to understand more clearly the power of package design, over traditional media, in influencing in-store purchasing decisions. And this study certainly reinforces that trend.

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About Richard Shear

designer, husband, teacher, blogger, father, athlete, author, historian Richard has over 25 years of brand identity and package design experience, with a wide range of clients such as Ahold, Coca-Cola, Hasbro, IBM, Johnson & Johnson, Pernod Ricard and Procter & Gamble. He began his career working with the legendary advertising art director, and AIGA Medalist, George Lois and the British design manager Clive Chajet. In his next design management position at Lippincott & Margulies, he worked with Walter Margulies learning the complex skills of global corporate identity. He then became Creative Director and Partner at Peterson & Blyth, one of the premier brand identity and package design firms of the time. He is a founding faculty member of the Masters in Branding Program at New York’s School of Visual Arts. He publishes the blog The Package Unseen, and has been a guest lecturer at colleges including FIT, Trinity College and Tyler School of Art. He is a graduate of the Tyler School of Art at Temple University. Richard is a Board member of the AIGA MetroNorth Chapter, past President of AIGA‘s Brand Design Association, President of the Package Design Council and a member of its Board of Directors. He is a member of USA Cycling and US Rowing, a nationally ranked masters bicycle racer, and a member of The Saugatuck Rowing Club, the 2010 Masters Club National Champion.
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3 Responses to Private Brands, and the power of buying decisions at the shelf

  1. Dennis says:

    66% of the decisions for private label brands happen in-store vs 20% for national ones!

    That are very impressive numbers!

    I guess further neuromarketing research will be very important in understanding why consumers do what they do!

    • Dennis, Thanks for your thoughts, and they are powerful numbers indeed. Perhaps the second part of the IRI column next week will begin to answer the question why consumers are motivated in this way. We’ll see.

  2. MoBeta says:

    As someone who works with PL Brands on a daily basis it’s nice to see the recognition. It’s not easy, we’re always expected to design on the cheapest budget. Making it eco-friendly with overseas factories—now there’s a challenge. We’re constantly pushing for less is more.

    I was curious Richard what your take on the latest Duane Reade overall is? I think it’s wonderfully playful, the flyer actually had me laughing out loud. One thing I’m always uneasy about however, is when PL brands package themselves to look exactly like their competitor and then say —compare us.

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