Private Label Buyer

PLBuyer NRF Show Coverage

January 11, 2011

NRF Presentation Highlights Key Areas for Building PL Success
While the members on the NRF show’s Building Private Label Success panel come from retail channels other than food retailing, they still presented lessons that can benefit food retailer private label efforts.

Specifically, they recommend:  

• Tread carefully when building new labels

• Demand innovation from your staff

• Collaborate with vendors

• Recognize the importance of technology in PL development
 
In the growing private labels, it’s important to differentiate yourself from the competition, said Roger Esnard, vice president, retail technology, at Macy’s.
 
“Everybody is trying to build private label programs to some extent and create a viable brand. I think whenever you get into talking about brands, any company starts off as a label until you evolve and grow your brand. You have to build those attributes like price and value into that brand in order to be successful,” he advised.
--Lynn Celmer


Food Origin Concerns Could Help PL Grow

Heighten consumer concerns about where their food comes from could help private label grow market share, one speaker said during the National Retail Federation’s annual show in New York Monday.

 

“When it comes to the future of private brands, I think more and more consumers are going to be concerned with where their products are coming from-tracing it from farm to fork, as I often say. We’re going to be able to leverage our private platform to do just that” said Cathy Green, president for the Food Lion family of banners, which are owned by the Delhaize Group.

 



Prepare for Mobile Shopping, Millennials, Expert Tells NRF Attendees
Retailers need to keep pace with changing consumers and how they use technology to shop and make shopping decisions, says Steven Skinner, vice president of Cognizant, a Teaneck, N.J.-based technology consulting firm, during his National Retail Federation presentation Monday in New York.
 
Two key trends retailers need to be aware of this year and into the future are the maturation of mobile shopping and the impact on retailing from the millennial generation, generally defined as those born from the early 1980s on and also known as Gen Y. Those trends are pointed to in a recent Cognizant study entitled “10 Megatrends Transforming the Retail Landscape.”
 

Cognizant surveyed more than 2,000 customers of varied age and income groups to find out how they feel about their store experiences. From their responses, Cognizant identified 10 megatrends that will shape the retail landscape.



 

Retailing Poised to Lead Economic Recovery, NRF President Says

Retailers are starting to see a glimmer of hope in what has been an atmosphere doom and gloom during the recession, National Retail Federation President and CEO Matt Shay said during his presentation Monday at the NRF show in New York.
 

“Last year, the retail industry proved to be one of the bright spots in the economy,” Shay says. “All of you managed to find a way to get it done, despite a tight economy.” From introducing more private label goods to keeping a tight inventory control, retailers did what they had to do to survive, Shay said.

Although the retail business experienced a relatively strong finish to 2010, that doesn’t in any way diminish the serious economic challenges all retailers still face, he cautioned.
 
The major mission for retailers this year is to focus consistently and passionately on shoppers, according to Matthew Rubel, chairman and CEO of Topeka, Kan.-based Collective Brands Inc., a retail footwear company.
 

“Focus on your customers,” Rubel said. “Innovate for them. Know how they shop and why they shop.”

--Lynn Celmer

 



Target Focuses on Customers, Target Exec Tells NRF Show

Minneapolis, Minn.-based Target uses a customer-focused approach to make a wide range of its operating decisions, from deciding which private label products it offers to its new hire training, Shelley Hyytinen, vice president, merchandising process & system development, Target Corp., told attendees during her Sunday presentation at the National Retail Federation (NRF) show in New York.
 
 “Across several product lines, we believed there was an opportunity to focus on being more relevant to a segment of our guests who are passionate about living a healthy lifestyle,” Hyytinen said in giving one example of a customer segment Target ahs focused on. “It was our objective to increase our relevance with this particular segment and to become a destination for more of its wants and needs.”
 
Target planned to do this by tailoring its assortment in some product categories to meet consumer needs and expanding exposure to these products in stores with the most potential. At the product level, Target used technology from software supplier DemandTec to identify items within categories that sold well and those that didn’t sell well with this demographic.
 

Target has taken the same customer-centric approach with its food offerings, Hyytinen said.

In addition to DemandTec’s software, there are a multitude of technology tools that are making it easier for retailer’s to gain consumer insights and develop new private label products. PLBuyer’s 2011 Sourcebook, coming in February, will for the first time include a special report on retailing infrastructure, covering new technologies, store design and merchandising strategies.

--Lynn Celmer



Retailers Need to Take Sustainability Initiative, Expert Tells NRF Show Attendees
Some retailers still have a long way to go to met sustainability goals, said James Dion, president of Chicago-based retail consulting firm DionCo and chair of NRF’s Sustainability Retailing Consortium (SRC), during his NRF presentation Sunday in New York.
 
Dion presented the newest version of the SRC Sustainability Scorecard, created by retailers to help benchmark their progress in sustainability. The scorecard measure nine categories, including program elements and administration, the consumer, building design, energy management, recycling and waste reduction, supply chain and logistics, products and packaging, accountability and education on sustainability.
 
Among the sustainability trends discovered by SRC:
 
  • 62 percent of companies don’t communicate the fact they recycle to their customers
  • 56 percent of companies don’t have any initiatives in place to either reduce product packaging mass/bulk
  • 60 percent of companies don’t have any initiatives in place to increase the content of recycled materials in their product packaging
  • 67 percent of companies don’t plan to put a defined label on their merchandise that documents the product’s sustainability
  • 70 percent of companies don’t audit their vendor community for authenticity in their sustainability claims.
Sustainability efforts in many cases have taken a back seat in recent years because of the rough economic period retailers recently experienced, he said.
 
But while some retailers have left the concept of sustainability by the wayside, others are fully embracing it.
 
Bentonville, Ark.-based Walmart, for example, turned corrugated waste from its stores into recycled boxes for its private label pizza.
 

 Jacksonville, Fla.-based Winn-Dixie also has focused on reducing its carbon footprint by reducing the packaging it its Winn-Dixie brand products and installing recycling receptacles in its stores for customers to recycle plastic shopping bags.

--Lynn Celmer



Focus on Four Areas to Succeed in 2011, Speaker Tells NRF Attendees
Many retailers will continue to face challenges in 2011; however there are steps they can take to ensure they will be winners in the retail game, said Natalie Berg, senior research director for London-based research firm Planet Retail, during her presentation at the NRF show Sunday in New York.
 
“This year could hold more promise for retailers, but they will have to work a lot harder to get shopper dollars,” Berg says. “There’s no room for an average retailer anymore. Retailers need to be ruthless and focus only on what they excel at and get rid of anything that doesn’t hold any value.” In order for retailers to win in 2011, she suggested:
 
  • Focus on core assets and drivers of profitability
  • Engage in targeted format diversification
  • Leverage insights from global operations
  • Strive for equilibrium between discovery and value
“Over the past year, we’ve seen a number of successful retailers look to divest unprofitable or non-core businesses, divest certain markets that weren’t adding value and remove certain categories from their stores,” Berg said.
 
Planet Retail works with PLBuyer to produce an exclusive list of North America's Top 30 Private Label grocery retailers each year. Watch for this year's list in the July issue of PLBuyer.
--Lynn Celmer