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PLMA Australia. Building A Successful Store Brand Program – A Proven Road Map August 22, 2007. Agenda. Why Store Brands? Quality – Job #1 Focus on the Consumer Brand Strategy Design and Impacting Consumer Choice Pricing and Profitability Brand Communication Execution and Implementation

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plma australia

PLMA Australia

Building A Successful Store Brand Program – A Proven Road Map

August 22, 2007

agenda
Agenda
  • Why Store Brands?
  • Quality – Job #1
  • Focus on the Consumer
  • Brand Strategy
  • Design and Impacting Consumer Choice
  • Pricing and Profitability
  • Brand Communication
  • Execution and Implementation
  • What are the Benefits?
why store brands

Why Store Brands?

Setting the Stage for Success

why store brands1
Why Store Brands?
  • Retailer Factors
    • Ownership
    • Flexibility
    • Profit
    • Image and Market Position
  • Consumer Factors
    • Need Satisfaction
    • Value Focus
    • Trust and Repeat Purchase
    • Customer for Life
quality as job 1

Quality As Job #1

Building a Strong, Lasting Foundation

quality as job 11
Define Quality Levels

ELPP

NBE

Premium

Establish Quality Specifications

Create Quality Review Process

Consumer

Technical

Specifications

Align Organization Behind Quality

Hold Manufacturers Accountable

Be Aware of Consumer Perceptions

Focus Brand and Brand Image on Proper Quality Levels

Maintain Quality with a Fanatical Focus

Quality As Job #1
focus on the customer

Focus on the Customer

Getting to Know the End User

focus on the consumer
Focus on the Consumer
  • Two levels of sales
    • Big C – retailer to the consumer
    • Little C – central organization to retailer
  • Know why the consumer buys (or does not buy)
  • Know how various factors can influence purchase
    • Design
    • Cost/Price
    • Merchandising and promotion
    • Product Experience
    • Tiers or quality perceptions
    • Interaction of all of the above
carlita branding for the future
Carlita-Branding for the Future
  • Internal Research— “El Store Brando”
    • Single Brand and legal
      • Onda, Dona Perlita, El Campito, La Companer, Pais del Sol, Rico Gusto, Rico Sazon, Fiesta Latina, La Buena Mesa, La Concineros, Tio Vivo
      • El tiempo para un experto
carlita branding for the future1
Carlita-Branding for the Future
  • Consumer Research—Time for Experts
    • Four branding houses engaged to help
      • Understand consumer shopping
      • Understand consumer usage
      • Identify image and attributes of brand
      • Determine design system
      • Assess consumer gaps with current brands
carlita branding for the future2
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Understand consumer shopping
      • Non-Hispanic Americans
        • Buy Mexican food at supermarket
        • Buy mainstream brands-Pace, Ortega
        • Prepare Mexican food 3 to 4 times a month
      • Hispanic Americans
        • Buy fresh ingredients in other outlets
        • Use authentic brands-La Costena, La Modera, Goya
        • Prepare Mexican 2-3 times a week
carlita branding for the future3
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Understand consumer usage
      • Quick and Easy
      • Convenient
      • Spicy and flavorful, not processed
      • Fun and Festive
      • Inexpensive
carlita branding for the future4
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Identify image and attributes of brand
      • Tested logo design
carlita branding for the future5
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Identify image and attributes of brand
      • Tevivo
        • “It looks like a logo for pizza”
        • “It looks like something for kids”
      • Mavo
        • “It looks authentic”
        • “It looks like Mayo, like mayonnaise jars”
carlita branding for the future6
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Identify image and attributes of brand
      • Candella
        • “It sounds Mexican”
        • “It looks like all other American brands”
      • Carlotta
        • “I imagine a Mexican grandmother”
        • “Carlotta sounds Italian--should be Carlita”
carlita branding for the future7
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Determine design system
      • Carlotta preferred over others for
        • “High quality photography and design”
        • “Premium quality”
        • “Eye catching, fresh and appetizing”
        • “Good for Mexican and authentic”
carlita branding for the future8
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Determine design system
      • Carlotta preferred over brands
        • “Stands out amongst mainstream brands”
        • “Higher quality”
        • “Eye catching”
carlita branding for the future9
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Signature Brand vs. Master Brand
      • Carlotta preferred over current brands
        • “Does not communicate Mexican”
        • “Interest in trying product none”
        • “Cheesy looking”
        • “Went from high quality and authentic to store brand”
carlita branding for the future10
Carlita-Branding for the Future
  • Consumer Research—Mexican Food
    • Conclusions
      • Single brand concept validated
      • Carlotta design chosen
        • Consumer perceived product as better than the national brands
      • Design conveys ‘Authentic Mexican’ quality through
        • Uniquely different look from traditional American brands (e.g. Old El Paso, Ortega, Taco Bell, etc.).
        • The rich brown background color (“like Mexican clay”) andAztec design.
        • The high quality image of each product depicted, featuring very fresh looking tomatoes, lettuce, cheese, salsa, etc.
        • The Mexican-like bowls on the salsa package.
brand strategy

Brand Strategy

Deciding Who You Want to Be

brand strategy1
Brand Strategy
  • What is “Brand”?
  • Brand hierarchy
    • Company
    • Store
    • Store décor and layout
    • Department selection and communication
    • Products carried
    • Store brands or private labels
    • Staff – knowledge, service and interaction
brand strategy2
Brand Strategy
  • Common Store Brand Hierarchy:
    • Good (price focused)
    • Better (value focused – national brand equivalent)
    • Best (Signature, Artisan, Aspirational, Premium)
  • All three always fit EVERY retailer – but to varying degrees based on format and consumer base
  • Mission Critical – create and communicate a Brand Portfolio Strategy
    • How product links to other brand pieces
brand portfolio strategy
Brand Portfolio Strategy

PRODUCT TIER / LABEL

QUALITY

ROLE

Entry Level

PRICE POINT

Master Brand

Good

Value

National Brand

EQUIVALENT

Master Brand

Better

Profit

“National” Brand

UNIQUE/EQUIVALENT

Signature Brand

Better / Unique

Image

Premium/Gourmet Level

UNIQUE

Master Brand

Best

Innovation

slide26

Brand Portfolio Strategy

PREMIUM TIER

Premium / Gourmet

FIRST TIER

National Brand Equivalent

SECOND TIER

Entry Level Price Point

Master Brand

Signature Brands

Master Brands

Master Brand

  • Meets needs of growth consumer that focuses on higher end products
  • Point of differentiation
  • Premium, unique, or custom quality where it fits
  • Natural baseline – organic when available
  • Premium packaging
  • Meets Consumers
  • emotional needs based
  • on Consumer Research
  • Proven Need not being
  • met by Master Brands
  • Point of Differentiation
  • High Image Packaging
  • NBE Quality or Better
  • Combines Volume for
  • Lower cost of Goods
  • Meets Consumers
  • needs for High Quality
  • Items at Prices Lower
  • than National Brands
  • Cornerstone of Store
  • Brands Program
  • Consumer Focused
  • Packaging
  • NBE Quality or Better
  • Meets Consumers
  • needs for Good Quality
  • Items at Prices Lower
  • than Regional Brands
  • Proven Need for the
  • Budget-Conscious
  • Consumer
  • Potential to Build Value
  • Image with Family Look

Single Brand Logo & Image

for Single Category

Single Logo & Varied Image

for Multiple Categories

Single Logo & Image

for Multiple Categories

High Impact Logo & Image

across categories

brand strategy3
Brand Strategy
  • Little C – very important all associates understand the brand structure and approach
  • Big C – will fundamentally understand how this works if…
    • Communication in-store is appropriate
    • Shelf placement reflects brand image
    • Pricing reflects brand image
    • Promotion and advertising reflects brand image
    • Individual tiers are treated as individual tiers
design and impacting consumer choice

Design and Impacting Consumer Choice

Creating a Compelling On-Shelf Image

design and impacting consumer choice1
Design and Impacting Consumer Choice
  • Package design is critical to brand and store brand success
    • Command attention
    • Stand out from the “clutter” on the shelves
    • Convey brand message
    • Entice consumers to change purchasing behavior
    • Reinforce brand strategy and support store image
    • Reflect intent and integrity of the overall branding system
  • For the consumer, the packaging IS the product
design and impacting consumer choice2
Design and Impacting Consumer Choice
  • Why is packaging so important?
    • 75+% of all purchase decisions are made at the shelf – packaging becomes the best advertising
    • There are only two to three seconds to grab a consumer’s attention
    • Brand architecture must convey the message in six seconds or less
    • Color, logo and package layout all impact a consumer’s perceptions about the quality and value of the item in question
pricing and profitability

Pricing and Profitability

Strategically Driving Behavior Through Retail Pricing and Business Economics

pricing and profitability1
Pricing and Profitability
  • Pricing strategy varies by tier and by desired consumer image
    • Good – everyday low price
    • Better – national brand comparative price gap
    • Best – premium pricing approach
  • Profit can also vary by tier
    • Good – what the market will support
    • Better – minimum 5% more than the brand target
    • Best – whatever the market will bear
    • Profit is not a bad word!
brand communication

Brand Communication

Steering Consumer Image – Delivering the Proper Message

brand communication1
Brand Communication
  • Big C – “Consumer”
    • Specific by tier
    • Consistent application
    • Limited interaction across tiers
      • Helps minimize confusion across product lines
  • Little C – “Customer”
    • Education and support
    • Understanding of the benefits
    • Clear communication of the strategy
slide38

Signage Program

Available to Retailers

Dangler & Mall Sign

Shelf Sign

Blank Shelf Sign

Channel Strip

slide39

Advertising Campaign

Available to Retailers

½ Page Newspaper Ad Format

Newspaper Ad Drop

slide40

MASTER BRANDS

Umbrella Signage

Two Campaigns

for competing retailers

“Quality Guaranteed”

&

“Make Our Brands

Your Brands”

Available for:

  • Flavorite
  • Richfoods
  • Foodland
  • IGA
  • HomeBest

2’ x 4’ Banners

slide41

MASTER BRANDS

Common Theme

Focusing on

Variety, Quality

and Great Price

“Quality Guaranteed”

slide42

MASTER BRANDS

Common Theme

Focusing on

Variety, Quality

and Great Price

“Make Our Brands

Your Brands”

slide43

SIGNATURE BRANDS

Umbrella Signage

Floor Graphic

2’ x 4’ Banner

slide44

SIGNATURE BRANDS

Common Theme

Focusing on Quality

merchandising strategy point of sale
Merchandising Strategy Point of Sale

Blade Signs

Banner Signs

Header Board

merchandising strategy point of sale1
Merchandising Strategy Point of Sale

Shelf Talkers

Recipe Boards

Shelf Strips

execution and implementation

Execution and Implementation

Delivering “The Last Mile”

execution and implementation1
Execution and Implementation
  • Communication is very important
    • Internal vs. External
    • Focused by organizational level
    • Continuous
    • Continuously refreshed
  • Brand Image and Brand Equity
    • External communication will build brand image
    • Trial will build brand equity
    • Associate support and focus will do both
cascade 7
Cascade 7
  • Define levels in an organization
    • From C-Level to associate level
    • If there are more than seven levels, your organization may benefit from change management assistance
  • Tailor the message to each level
  • Move organization from Alignment to Agreement
  • Develop a communication schedule and appoint a communication lead
level 1 c level leaders
List leaders at this level

Presentation Mission

Create alignment and buy in to the message

Review top line objectives to be achieved

Define benefits of implementation and need for visible and vocal support

Desired Outcome

Gain commitment to active and visible support of initiative

Communication Strategies

Preliminary action plan (high level)

Media examples and plan

Playbook concept = team approach to achieving objectives

Review monthly and quarterly communication vehicles

Project impact of overall program to EBIT or other measures

Level 1 – C Level Leaders
level 2 top level staff line leaders
Presentation Mission

Create buy-in

Communicate C-Level support

Present top line research findings

Review overall program goals and objectives

Desired Outcome

Establish supporting objectives for teams

Implement defined roles and responsibilities

Communication Strategies

Video excerpts of C-Level support

Action plan and benchmarks for success (link to company mission)

Impact on:

Company sales

Company profit

Operating Unit sales

Operating Unit profits

Define roles of this level of leadership and need for their active and visible support

Level 2 – Top Level Staff/Line Leaders
level 3 division department leaders
Presentation Mission

Create buy-in

Communicate executive level support

Define this group’s impact on achieving positive results

Present top line research findings

Deliverables

Implementation timeline

Creation of accountabilities model for direct reports

Communication Strategies

Video featuring executive level commitment, mission and rollout strategy

In depth research data

Deliver PlayBook – monthly and quarterly action plan

Business unit goals and objectives

Sales

Profit

Share

Team accountability model

Level 3 – Division/Department Leaders
level 4 middle management influencers
Presentation Mission

Create buy-in

Research data and executive level commitment

Top line reporting and communication approach

Sales/Profit goals for team

Deliverables

Business unit specific goals and objectives (category or department)

Success measures

Communication Strategies

Video delivering directive and mission from executive team

Execution level strategies

Deliver PlayBook – monthly and quarterly action plan with outline of tactics

Accountability and measures

Communication guidance for all teams

Level 4 – Middle Management (Influencers)
level 5 staff and line managers
Presentation Mission

Create buy-in and motivate team

Research data and executive level commitment

Account level sales/profit expectations

Avenues and ways to drive sales and profits

Top line report – current derailers

Deliverables

Time-action plan for all accounts

Communication Strategies

Video delivering directive and mission from executive team

Transactional vs. recurring sales opportunities

“How To” in terms of providing direction and input to customer teams

Accountability and training (Train the Trainer)

Execution level PlayBook

Timeline, accountabilities, measures

Level 5 – Staff and Line Managers
level 6 customer facing managers
Presentation Mission

Create buy-in and motivate team

Research data and executive level commitment

Company and customer benefit description

Individual customer performance goals

Deliverables

Customer specific implementation plans

Communication Strategies

Video delivering directive and mission from executive team

Customer PlayBook

Prioritization Model for effective execution

Customer targeted facts and message

Marketing support and message

Accountability and training

Benchmarks and measures

Level 6 – Customer Facing Managers
level 7 consumer facing associates
Presentation Mission

Create buy-in and motivate team

Research data and executive level commitment

Consumer benefit statements and list of benefits

Deliverables

Consumer touch point measurement

Moments of Truth and how to change consumer behavior

Communication Strategies

Video delivering directive and mission from executive team

Consumer Benefit PlayBook

Fast Facts

Up Selling

FAQ’s

Top 10 Reasons To…

Educational materials

Accountability and training

Success measurement

Level 7 – Consumer Facing Associates
what are the benefits
What Are The Benefits?

Store #1 - $200,000 in Weekly Sales

Segment Share Margin Contribution Dollars

Brand 93% 24% 22.32 $44,640

P/L 7% 26% 1.82 $3,640

Total 24.14% $48,280

Annual Difference - $193,440

Store #2 - $200,000 in Weekly Sales

Segment Share Margin Contribution Dollars

Brand 80% 24% 19.20 $38,400

P/L 20% 34% 6.80 $13,600

Total 26.00% $52,000

Chainwide Difference (100 Stores) - $19,344,000

thank you

Thank You!!

Good Luck Building Brands for the Future

[email protected]

612-845-0064 (C)

612-216-5204 (O)

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