THOUGHTS
WHEN LIDL AND ALDI CAME ALONG, THEY DIDN'T ADHERE TO STRICT OWN-BRAND PACKAGING GUIDELINES. THEY DIDN'T TREAT TOILET ROLL PACKAGING GRAPHICS THE SAME AS HONEY.
By
Reading time: 4 min
WHEN LIDL AND ALDI CAME ALONG, THEY DIDN'T ADHERE TO STRICT OWN-BRAND PACKAGING GUIDELINES. THEY DIDN'T TREAT TOILET ROLL PACKAGING GRAPHICS THE SAME AS HONEY.
We loved watching Mad Men. In the 1960s advertising drama's greatest moment (in the episode 'Carousel'), Don Draper says: "The most important idea in advertising is...New. It creates an itch. You simply put your product in there like a sort of... calamine lotion."
Don was right. Sort of.
We have worked with many supermarkets designing their point of sale and own brand/private label packaging (Tesco, Sainsbury's, M&S, Waitrose, Seicomart, Fozzy Group, KDD, Fresh & Easy USA, and Asda, among others). One thing we learned was that, with own-brand packaging, when they put a new flash on a pack or changed the packaging, even without improving the product, sales went up roughly 25%. Then they fell back again when they became 'normal'.
This is why you see so many tweaks, redesigns and new and improved labels on private-label packaging.
But the new buzz doesn't last long. New wears off. A new car is exciting. But over time, it gets washed less often. The excitement fades. It becomes normal. If a car brand proves to be unreliable, it won't get bought again. Customers will move to a new brand.
That's why new needs to be backed up by delivery.
Private-label used to be like this:
They were just products. The packaging might have been pretty, but toilet rolls were often treated the same way as orange juice.
Even with a new flash on it or some really cute illustrations, it didn't exactly instil a sense of brand or product loyalty.
In 2001, not long before 9/11, I got a job at a design agency in London that designed Tesco Finest. In the interview, I said that the future of own brand was for supermarkets to create and nurture their own brands, as opposed to own-brand. I'd seen Lidl and Aldi, but the main reason was a project I'd worked on before. Sainsbury's had Red Label Tea. It was a huge brand dating back to 1903 and was Sainsbury's largest-selling own-brand product. But it was really a brand and a reason people went specifically to Sainsbury's. But sales had declined, so we added a dose of Don Draper new... and reinstated the red label that previous designers had changed to cream. The design today is an evolution of what I did all those years ago.
Tesco had created a range of brands and a 'good, better, best' range three-tier strategy. Finest was the top-tier, 'best' and it revolutionised own-brand in the UK. Before long, every supermarket was creating their own top-tier 'best' branded range with some better ones like Taste The Difference from Sainsbury's and the not-so-good, Finest rip-offs in black and silver from others.
These top-tier ranges grew. But the middle 'better' tier of own-brand products sales in the UK were flat.
Then Lidl and Aldi came along and dropped the whole name of the supermarket, name of the product and image template. They didn't adhere to strict, imposing middle-tier own-brand packaging guidelines. They didn't treat toilet roll packaging graphics the same as honey.
All their own brands looked like unknown brands sourced from small producers from far and wide by wise buyers at insanely cheap prices. These were all designed to either copy brand leaders or look credible in their sector.
There was no 'Aldi' branded processed peas. You got Four Seasons Marrowfat Peas instead. Clever.
This made the products feel like they were sourced from small producers. Like they were small, friendly, local underdogs. They looked like the brands and they weren't too bad. They didn't look the same as toilet rolls. And they were insanely cheap.
I know this as friends and family kept telling me. When I pointed out that they were own brand products, they would get argumentative, saying they weren't. Look on the back I'd say, where it says 'produced for...'.
The big supermarkets took note (not of me, of Aldi and Lidl's success!). Tesco had been copied with Finest, now they were copying Lidl and Aldi with 'unknown' brands of their own. So their strategy was now 'good' (Tesco Value range), 'A bit better' (Unknown branded range), 'better still' (own brand) and 'best' aka Finest.
Own brand sales are now increasing. Reiters report that: 'The latest data showed value sales of own-label goods grew by 14.1% compared to branded product growth of 7.1%. In the last four weeks, the volume share of own-label sales rose to 63.3% in the fast-moving consumer goods category, versus 62.1% in 2022'.
Impressive. Especially as during the pandemic, own-brand sales actually went down (with the possible exception of toilet roll!). People bought brands as they were trusted.
Supermarkets are starting to nurture their own brands, like Wicked, Dutchy Originals, My Goodness and the 'exclusively at Tesco' ranges like T.E. Stockwell, H.W. Nevill's etc. It's a smart move and it's working. It's a reason for people to go to your store. They can buy brands elsewhere, but T.E.Stockwell is only in Tesco. Taste the Difference is only in Sainsbury's. Duchy Originals are only available in Waitrose. Owning a trustworthy brand is a reason for someone to choose you over a competitor other than just price.
The big supermarkets have increased market share while Lidl and Aldi have recently stalled. The power of new has worn off.
I was saying this 22 years ago. They didn't need new flashes or to redesign Tesco orange juice every year. They just needed good products and ranges that looked credible in context with the brand, and worthy of the price on the shelf.
We'd love to help more supermarkets do this.
