Behind the Brands
My dusty college marketing textbooks define brand loyalty as the “degree to which a consumer intentionally and repeatedly chooses one brand over another.” My mother just spent a week with me, helping Dave and I prepare for my first Thanksgiving at my new house. I now define brand loyalty as “the length of time one person will fight with a blood relative in the middle of a crowded grocery store before making a purchase.” I’ll spare you the bloody details but let’s just say that my mother and I have agreed to disagree on most of the decisions that one makes when one wheels their cart into a supermarket, namely brand decisions. (Come to think of it, we even had a brief spat over the choice of shopping cart but that’s neither here nor there.)
For many people venturing out on their own, the thrill of buying your very own Cocoa Puffs and dish detergent wears off pretty fast. Grocery shopping, whether you do it daily, weekly, or monthly, becomes a relatively irksome, repetitive, and expensive task. According to the Bureau of Labor Statistics, the average consumer unit (new government speak for household) spends about 14.5% of its annual income on food and grocery items. (However, this figure does include meals eaten away from home.) That’s quite a slice of pie.
In order to make that slice a bit thinner, seasoned shoppers employ a number of tactics including coupon clipping and store hopping. One colleague of mine scours the circulars of three separate grocery stores each week and visits each one every Saturday morning. in order to get the lowest prices. Others buy in bulk at warehouse stores (gallon jar of mayonnaise anyone?). Still others employ a tactic that requires considerably less driving from store to store or storage space: simply eschewing name brands in favor of the often cheaper store brand versions of their favorite products.
Those born in the eighties may not remember this but store brand products used to be called “no-frills” brands. The idea was that you were paying less because you weren’t paying for fancy packaging or advertising. The packaging was atrocious, plain white labels with simple black text announcing the contents – PEAS, OATS, MACARONI . . .. One of my earliest childhood memories is of my sister and I begging, no pleading with our parents in the cereal aisle of our local Pathmark to please, please buy actual Lucky Charms and not OAT CEREAL WITH MARSHMALLOW BITS. My ever thrifty and never subtle parents replied, loudly, “It’s the same damn thing!” I was a kid and it so was not.
Now I’m an adult, and my recent argument in the spice aisle notwithstanding, I can say today that my parents were right, sort of. Sometimes store brands are, in fact, the same damn things. But sometimes they’re not. And, there’s no easy way to tell when your favorite brands are masquerading behind cheaper packaging.
Just who makes store brands anyway? There’s no easy answer. The number of store brands and store branded products has exploded in recent years as grocery store chains consolidate and look for ways to remain competitive in an industry with traditionally low profit margins. These days, the same store brands or, as the industry calls them, private labels, can often be found at different grocery chains. For example, all of the stores owned by the Great Atlantic and Pacific Tea Company, including Super Fresh, A& P, and Waldbaum’s, carry the America’s Choice and Master Choice private label products. Safeway Stores (Safeway, Genuardi’s, Tom Thumb, etc) sell Safeway Select. Wal-Mart and Sam’s Club stores carry Sam’s Choice and Kirkland, though they have begun selling Kirkland to other store chains to use as their own private label.
Confused yet? I know I am. That’s why I turned to the trade group that represents private label manufacturers, the Private Label Manufacturers Association (you knew there had to be one) to try and find out just who makes these products. Here was their answer:
Manufacturers of store brand products fall into four classifications:
- Large national brand manufacturers that utilize their expertise and excess plant capacity to supply store brands
- Small, quality manufacturers who specialize in particular product lines and concentrate on producing store brands almost exclusively. Often these companies are owned by corporations that also produce national brands
- Major retailers and wholesalers that own their own manufacturing facilities and provide store brand products for themselves
- Regional brand manufacturers that produce private label products for specific markets
Well that answers that question.
Surely someone out there has a more specific answer, particularly about that first point, the one about the major manufacturers using excess plant capacity. I want to know more about that one. Luckily the private label manufacturers also have their own magazine (Perhaps this is the one magazine in existence without J.Lo on the cover). This handy publication reports on the wheeling and dealing going on in the industry. A scan of their recent issues revealed the following:
- The Dial Corporation, best known for making soaps, detergents and other cleaning products with such appetizing names as Purex and Borax, is also the parent company of Armour brand canned meat products. In addition to making its own brand of chili, hash and beef stew, Dial/Armour packages these same products under the private labels of K-Mart, Kroger and other stores.
- Del Monte Foods, which owns such brands as College Inn, Contadina, Starkist, and S & W, also runs Corporate Brands division that specializing in making private label soups and other canned goods.
- If you pick up a can of store branded chunky-style soup with a name like Grilled Chunky Chicken or Grilled Chunky Sirloin, (designed to compete with Campbell’s), chances are it was made by the Heinz Corporation, home to brands like Classico, Ore-Ida, and a full corporate brands division.
- If you’ve ever purchased Health Valley granola bars and breakfast bars in a desperate attempt to kick your Pop Tart habit, you should know that both its products and the private label equivalents are produced at the same California plant owned by Bloomfield Bakers.
- Until recently, tea drinkers buying private label tea bags at many grocery chains were buying tea produced by the Tetley company’s private label division. Tetley has since sold off the division to the Harris Tea Company.
- Food giant ConAgra, parent to over thirty national and regional brands including Healthy Choice, Hunt’s, and Chef Boyardee, runs a particularly thriving Store Brands Division. This division reportedly produces everything from granola bars to cereal to pie crust. Interestingly enough, like many of the national manufacturers who produce private label products, very few of their private label offerings compete directly with their own brands. With literally hundreds of products on the market, that must be a tricky balance for ConAgra to maintain.
By now you might be thinking that this is an awful lot of research to do to find out whether or not to buy the private label can of peas or box of macaroni. And I would say, “you are absolutely right – I’m exhausted.” Other suggested methods of tracking down private label information, such as calling, emailing, or writing to the manufacturers would not only be time consuming, they would also yield dubious results. Very few manufacturers would encourage you to spend less for their products. Not if they want to stay in business, that is. Moreover, even if you could prove that General Mills makes both Cheerios and the less costly Oat Rings, you have no guarantee that they use the same recipe or quality of ingredients for both versions.
No, despite the fact that the Internet has given us more access to information about what’s going on behind the scenes at the companies that make our favorite products, old fashioned trial and error works best when deciding whether a brand name is worth the extra money.
For our family, only Tropicana orange juice, Skippy peanut butter, Breyers ice cream, Cheerios, Coca Cola and Cracker Barrel cheese will do. The taste is just too important. Some products are mandated by law to be identical. Private label infant formula, for example, must be nutritionally identical to more expensive brands like Similac and Enfamil. Unfortunately, my infant daughter didn’t care about government standards, she only wanted the pricey stuff. In fact, she only seemed to want the brand I had the fewest coupons for, go figure. I’ll gladly buy store brand yogurt, butter, sugar, and other items. I can’t taste a difference there. But sometimes it does make a difference and no matter what my mother says, I’m willing to pay extra for that difference. Sometimes.
