ADHESIVES S
ales of own-label products at British supermarkets have grown at double the speed of branded goods in 20231
,
and that’s understandable – the cost of living crisis is having an impact on everyone’s spending, meaning there is a need for more cost-effective, affordable goods. Private label products have traditionally been cheaper than brands as they are all marketed under the parent retail brand to save costs. But own label is getting pricier.
Inflation, interest rates and the rising cost of raw materials and logistics are having an impact on manufacturing - and this affects everyone. Retailers still use external manufacturers to create their private label products and those manufacturers are working in the same market conditions, and seeing the same issues in their supply chain, as those who are working with brands.
Apparently, prices are actually rising faster on many of these own-label ranges than they are on branded goods. Earlier this year, The Financial Times reported that private label goods saw a price rise of 16.3%, surpassing the 10% increase in branded goods. And data analysis company Kantar went further, citing a massive 46% rise year on year on prices of some own label goods.
Brand switching
If DIY and decorating own-label products continue to rise in price, they will soon catch up with the non-offer costs on brands, leading to a potential switch in the minds of those making the purchases. This could threaten the private label market, as more people turn to brands, if they’re similar in price.
Seven out of 10 shoppers will buy from brands that they trust, according to a study by Adobe and almost half of DIY shoppers would still prefer A brands (Statista, 2022). We know this at Shurtape, as we sell some of the UK’s market-leading adhesive and sealant
PRIVATE LABEL V BRANDED GOODS
BMJ talked to Shurtape’s Jason Burns about the importance of a good, solid, quality brand.
tape brands. Customer loyalty remains strong both here and in the US, where our parent company is based. When we first brought FrogTape to the UK, we were delighted to provide such a strong brand and product range to professional decorators. Just two years ago we added to our decorating tapes range by introducing Kip Washi-Tec®
to our
portfolio - a truly genuine Washi tape, with a unique construction using Japanese technology. We now offer our professional customers a complete range of branded adhesive tapes - all delivered through a trusted global supplier with proven support strategies.
Those support strategies, constant innovation, and ability to invest in seeking out new technologies and promoting them to the user - and driving traffic to store through regular, thorough marketing investment - is what being a leading brand is about. We know from our own research that professional and amateur decorators know our products will do the job expected and that confidence and trust in the quality of results
December 2023
www.buildersmerchantsjournal.net
is
huge.That trust comes from the long-term investments we make in ensuring the quality of our service and product, the enjoyment of the whole customer service experience, and how we build customer relationships. As a company, we enjoy working closely with builders’ merchants and we ensure our marketing is focused on getting their customers to the door to buy. We invest in strategic activity across all our adhesive tapes, be it partnering with the Bald Builders for some great tongue in cheek activity or embarking on a tour of UK sites with our products, to provide in-store demonstrations and social media challenges. Own label products have sat happily alongside branded goods for decades. They serve a purpose, providing relatively good quality for their cheaper price point. But they don’t traditionally instil the same level of user loyalty and trust. If the rising costs continue to impact on their prices, it is going to have genuine impact on consumer shopping habits. And this could have quite the impact on the shop floor. BMJ
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