My two cents on Marketing

Traditionally, private labeling has been strongest in commodities which have low involvement such as butter, eggs , flour and sugar. Now, more and more consumers are trading down to private label brands, while more private brands are getting sophisticated and investing in brand strategies.

As the private label market matures, it takes on more diverse products and services. For instance, Tesco in the UK offers petrol, President’s Choice from Canadian retailer Loblaw offers anything from cereals to financial services and Costco’s Kirkland Signature offers tires, fresh food and alcoholic beverages.

Private labels products are less expensive, thus, they are often perceived as lower quality alternative. A  large part of growing in the private label market now involves improving the product’s quality. This raises the threat to branded product. How should the branded competitors react to threat?