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Consumer acceptance has driven sales in the private label paper category up, while consumer expectations have set many retailers on a search to find high quality store brand products to add to shelves.
Last year, for example, grocer H-E-B’s introduced H-E-B Our Finest Bath Tissue, available in Ultra Strong and Ultra Soft. The store brand tissue is made using the same Thru-Air Dried (TAD) Technology as national brand Charmin, which the retailer claims allows it to offer “the same cushion-soft feel.”
In response to eco-minded consumers, club store BJ’s launched its new Generation Earth brand of goods last year. These are responsibly sourced and manufactured, using fewer resources and without the use of harmful ingredients. Paper goods in the line (napkins, paper towels and bath tissue) are “tree positive” --meaning for every one tree used; two are planted in its place.
It’s no surprise retailers would be looking to capture consumers’ attention by adding new paper products to their line ups. Private label toilet tissue was up more than 10 percent to almost $1.58 billion with a 30 percent share, according to SymphonyIRI data for the 52 weeks ending Dec 1, 2013. The category as a whole brought in over 8 billion. Private label facial tissue was up more than five percent with an almost 30 percent share and private label paper towels were up just slightly, capturing a 44 percent share.
“A clear trend that we see in private labels is continuous product improvement of tissue paper products’ quality and performance,” confirmed Craig Nelson, executive VP, Consumer Products – United States, Cascades Tissue Group. “The economy and consumers expectations are driving those trends. The economic conditions in the US will keep on improving. This will allow consumers to ‘upgrade’ in the products that they purchase. The expanding capacity in the higher quality tissue manufacturing is indicative of the industry preparing for that to occur.”
Consumers will benefit from this expansion in both bath tissue and toweling products, predicted Nelson.
So when it comes to new bath tissue, such as the H-E-B Our Finest Bath Tissue, will TAD Technology actually become a standard for high-end bath tissue products on the market? Nelson thinks so.
“With consumers and retailers being more on the lookout for high-end products that combine increased softness and performance, companies are investing in TAD machines to fulfill this demand.”
And as TAD technology is not proprietary in the US tissue market, Nelson explained, if a manufacturer has the money, they can purchase a TAD paper machine.
“TAD machines are very expensive, very large and require a significant amount of infrastructure to run. First Quality has been producing TAD products for many years, because they have proven there is a market for TAD product in the private label arena, now you are seeing additional manufacturers investing in this technology.
“As the economical crisis redefined the marketplace, consumers are more preoccupied by their budget and stay on the lookout for the best value possible. They ask for the level of performance offered by the main national brands, but at a competitive price, which is when private labels are a solution. Private label paper products offer a less expensive option and typically as good as or better than the national brand that it is being compared to. Retail buyers have become very astute to demanding that the store brand be NBE (national brand equivalent), which is why you see more and more store brands adopting this positioning.”
Of course, while many consumers are seeking a bulkier and softer paper product, which Nelson explained the TAD process allows for since the paper is dried with hot air instead of being pressed like it is with other technologies, many consumers looking to trade up also want environmentally friendly options. Unfortunately most of the US TAD machines consume vast amounts of energy and water, and produce a lot more GHG than regular paper machines, according to Nelson.
“At Cascades, reducing our environmental impact is a daily preoccupation. This led us to invest in a different technology, ATMOS, which allows us to produce a TAD-equivalent paper with a significantly lower environmental impact. For example, our ATMOS machine releases between 77 percent and 81 percent less greenhouse gases than a regular US TAD machine.”
Technological advancements made to paper manufacturing and processes have allowed retailers to launch greener paper products like BJ’s Generation Earth brand, but still offer the high quality consumers are looking for.
“Recycled paper products can now be a green alternative with a high quality standard that meets the consumers’ desires,” said Nelson. “No longer does a consumer have to ‘compromise’ their quality standards in order to feel good about what they are doing for the environment.
“At Cascades, we believe that environmentally preferable products are becoming standard practice in the tissue products private label market, because retail buyers and consumers are taking the market that direction. Paper manufacturing and processing innovation allows more and more efficiency, and the impact of paper products’ manufacturing is becoming less resource-intensive.
“The market is seeing new recipes and alternative raw materials, as well as new technologies allowing greater quality and product performance (i.e. ATMOS machine). Both the planet and the end-user will benefit from this evolution of practices.
“In the coming years, we also feel that every company will push its corporate social responsibility actions further than a green products offering. Strategies to work on climate and energy, on employee wellness, on waste, on supply chain, on water use, and on community relations will become normal and expected business practices.”
Packaging is also key to setting store brands apart. “Brand oriented” packaging can help store brands pop on the shelf.
“Too many of the package designs we see on the shelves are very generic,” said Nelson. “For example, we see the store brand name in small type and a generic product claim like ‘bath tissue’ in very large type. With national brands, the brand name and image are most prominent on the package, and ‘bath tissue’ is just a descriptor in small type.
“At Cascades, we have a full service creative design group in-house and we are working everyday with customers and their design studios, helping them integrate the elements of a functioning brand and which aspects they should take into consideration when they produce their brand image.”
Nelson advised retailers to call out what brand they are comparing to and shelve the product next to that brand.
While better environmental practices and superb packaging are one way to set store brands apart from national brands, innovative products can be as well, providing retailers are willing to dedicate shelf space when there is no national brand for the product to compare to.
Cascades, for example, offers two new products unique to the US private label market with no national brand equivalent.
One is a napkin product that is dispensed from a package one-at-a-time.
“This eliminates the hassle of opening a standard napkin bulk pack and having the wind blow all the napkins around your picnic area,” said Nelson.
The other is the Cascades Antibacterial paper hand towel that has recently been introduced in the Northeastern US.
“This towel provides a simple and effective way to further reduce bacterial contamination and transmission,” explained Nelson. “Unlike ordinary paper towels, when this paper towel comes into contact with the water on your hands as you dry them, it releases an active ingredient that eliminates 99.99 percent of bacteria. Made from 100 percent recycled fiber, this towel easily fits anywhere, and doesn’t require any additional steps or change of habits.”
As new technologies improve and emerge, retailers will stand to prosper in the billion dollar paper industry. Staying ahead of the game can be tricky, but with the right partners, products, and packaging, store brand bath towels and tissue can find a loyal following from consumers.