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Generic products (e.g., Tinfoil made by Safeway, Aspirin made by Tesco) seem to exist merely to capture the dollars available from people who merely need an item's function, not a brand's reputation. Tinfoil from Safeway will probably do exactly what a consumer wants it to do - even though it isn't backed by a famous kitchen-wrap brand such as Reynolds. An article written by Rob Walker in the New York Times Magazine this weekend brings up two very interesting aspects about generics. First, the traditional generic approach is to make your packaging look as close to the name-brand as possible.
Pepto generics are pink and have the same type of bottle. Cola generics come in red and white cans with script on them. The logic (according to Walker) is that by borrowing imagery from the name-brand product a generic can undercut the power of the brand message - convincing a consumer that they'll have a similar experience by spending less and going with the store brand.
I can see why this is a powerful temptation. When a generic with no advertising budget goes up against a company with millions to spend it is awfully easy to just grab onto a coattail and see how far you can go. Business is a game of margins. The generics have grabbed the middle ground in a scale that runs from building a brand, through creating similar generics, to copying the original brand exactly and selling a counterfeit version. (This is my scale, not Walker's.) Counterfeits get all the same benefits of generics, but can charge more and spend even less on establishing a brand. Conversely, a counterfeit borrows more from the goodwill of the name-brand and damages the name-brand more severely by its mere existence. (I'll save an indepth look at this topic for another day.) The second aspect that Walker brings up is that the traditional generic relationship might not be the best way. He points to Publix - an 878-store chain in the Southern states that has established its own brand of generics. Rather than copying the name-brand for each of the hundreds (or thousands) of products, Publix has developed a look and feel that establishes the store brand as something to be desired. While not revolutionary in retail, it is pretty unusual in the grocery business. (For examples of retail chains that leverage the store brand as a top choice just look at Kenmore and Craftsman brands.) I guess it comes down to whether or not the store brand can put out a product that has an identity that connects with the consumer. Sears has done a great job with tools and appliances, and it looks like Publix is doing well with consumables. I'm not completely convinced, however. I didn't see any indication that the effort had paid off. Sure, they've won some awards for their graphic design work, but how does this translate into higher sales, improved margins, or better customer loyalty? Does putting pictures of tinfoil critters on your generic foil boxes mean that you'll win over converts to your brand? (okay... perhaps it might...) Or does having a picture of a dog sniffing a garbage bag help to sway people to purchase the store brand over Glad? The skeptic in me says that while the idea of branding a store's own products is good, the execution isn't quite there. Why spend all the money on designing one's own brand when the identity behind the brand isn't solid? Who is Publix? What is their specialty? Why would I buy their product over the generic? I don't think that box art contributes long-term to the bottom line. Once Publix creates a solid brand identity (beyond minimalist black-and-white boxes - and into something really meaningful) across all products I'll consider jumping on board. Has anyone actually been to one of these stores? Has Publix already done the work and put a solid message behind their products? If so, what is it? Tate Linden |
