6 Best Practices for Private Label Sales

Want to build a deeper sense of trust with your customers? With 90% of Americans concerned about food prices right now and consumers actively seeking new brand options when they shop, a robust private label offering is a great place to start.

"It used to be shoppers would be willing to consider new choices, but would still have a brand choice or brand loyalty," IGA CEO John Ross says. "COVID introduced shoppers to hundreds of new brands because of out of stocks and as a consequence, they've learned that experimenting with these other brands brings benefits. There's never been a better time to introduce shoppers to private label."

Introduced in the 1970s to combat inflation, private label has come a long way with shopper perception. Today, over 80 percent of shoppers trust the quality of store-branded offerings, according to data published by Acosta, a sales and marketing company for the consumer packaged goods (CPG) industry.

And shoppers are doing their research. Acosta found that today's shoppers are more informed as to which retailers' brands are better than others and 40% of U.S. shoppers are buying more private label now that grocery prices are rising.

"In some key grocery categories, private label is outperforming brand name products. According to a recent IRI report, high inflationary categories such as eggs, meat, dairy, and oil were all trending up among store brands," says Dave Wendland, VP of strategic relations at Hamacher Resource Group. 

Whether independent retailers use IGA's Exclusive Brand products or another private label line offered by their wholesaler, it's important to capitalize on these trends, especially right now, Ross says. 

"The average independent store sells less than 20% private label offerings, which means the average shopper has not tried our private label," he says. "Things like sampling, trial pricing, and incentives to compare are great tactics right now. Don't presume shoppers have tried your private label offering and know its value. With high inflation and willingness to experiment, there's never been a better time to relaunch your private label — IGA Exclusive Brand or your wholesaler's line — to shoppers who are willing try."

Independent retailers can relaunch their private label offerings to gain loyalty from inflation-affected shoppers using the best practices outlined below. 

Best Practices For Private Label Sales

"IGA Exclusive Brand products appeal to shoppers focused on both value and quality, and its position as one of the most established private label offerings in the country makes it one of the most trusted labels on your store shelves," IGA Senior Director of Exclusive Brands Dan Muller says, adding that retailers who have implemented the below best practices have experienced great success with private label sales. 

Whether a store is IGA-branded or unbranded, these best practices will build shopper trust, promote private label products, and keep shoppers interested. 

1. Merchandising

When it comes to merchandising your private label, make customers aware of private label offerings throughout the store with these tactics:

• Cross merchandise
  Feature store brands and national brands together on end caps and displays. An example could be private label snacks (chips, peanuts, etc.) with national brand soda.
  
  
• Feature store brands within fresh departments
  Put private label barbecue sauce in the meat department; private label black pepper with the eggs; private label vanilla wafers next to the bananas in the produce department.
  
  
• Implement price shielding
  "When a national brand goes on sale, make sure the store brand equivalent is priced lower," Muller says. "And use shelf signs to highlight the lower price."

KJ's IGA in Lake City, Florida cross merchandises Exclusive Brand condiments with cups and grilling supplies.

2. Signage

Communicate the value and quality of private label offerings with signs that demonstrate the savings when choosing store brands over the national brand equivalent. "Sometimes your customers need as much visual guidance as possible," Muller says. He recommends the following types of signage:

• Create a sign where you fill two shopping carts with core products: one with national brands, the other with store brands. Include a receipt to show the savings.
  
  
• Include signage that details the money back or double-your-money-back guarantee on the store brand product. Exclusive Brand products offer the latter! Want to highlight your Exclusive Brand offerings? Use IGA's Exclusive Brand sign kit, available here.
  
  
• Print and display IGA-supplied shelf tags for the IGA Exclusive Brand products in each ad cycle of the National Digital Ad. 

Find Exclusive Brand signage through the Exclusive Brand sign kit or the Quarterly Marketing Kit.

3. Product Samples

Tasting a delicious product can convince even the most hesitant shopper. Provide samples of tasty recipes using Exclusive Brand products that will inspire your shoppers to purchase multiple private label items. Need inspiration? IGA has a plethora of recipes here.

In addition to having shoppers sample the product, ensure your employees have tried store brand products. "Word of mouth is one of the most effective marketing strategies," Muller says. "Encourage employees to recommend IGA Exclusive Brand products when asked about an item."

4. Meal Solutions

Make dinner time as easy as possible for your shoppers. They’re in a hurry, and if they see an end cap with products to feed a family of four (such as pasta, sauce, grated cheese, and bread), this simplifies things. Use IGA recipes every other week to keep your customers coming back for more! Find recipe cards to display in-store here.

IGA has recipe cards using Exclusive Brand products that you can display in-store.

5. Educate Shoppers About Shrinkflation 

As branded manufacturers search for ways to retain loyalty – and in order to offer a price point that fits household budgets – some have repackaged products to offer fewer servings per pack or smaller sized items at a certain price point.

"Most often dubbed ‘shrinkflation,’ this is an opportunity for private label products to promote this difference at shelf," Wendland says. "If the brand has downsized their pack size, chances are the private label has not."

Communicate this information to shoppers through social media messaging and in-store shelf tags, such as, "Best Value! Same size package, same price." Or, "No shrinkflation here!"

6. Online Promotion

Translate these best practices to your eCommerce strategy to ensure online shoppers also know and understand the value and availability of high quality, lower priced private label offerings.

• "Lean into your private label more visibly," Wendland recommends. Make private label products the first thing that visitors see on your eCommerce site.
  
  
• "Promote a cross-category message and build on your best sellers," he adds. For example, use messaging like, "If you love Sweet Baby Ray's barbecue sauce, you'll love IGA Exclusive Brand barbecue sauce." You can use this messaging in-store, too.

In addition to the best practices outlined above, Muller and his team have been releasing new products, including new mustard flavors, bread crumb varieties, and a new water supplier to ensure shoppers can find what they need with IGA Exclusive Brand private label. Stay tuned to our eNewsletter for more updates, as IGA will be releasing 12 replacement ice cream flavors in late September.  

"There's a huge opportunity for retailers in the Independent Grocers Alliance, since our IGA Exclusive Brand private label line is truly a superior quality and offers the double-your-money-back guarantee, which is an unparalleled benefit to inflation-weary shoppers," says Ross. "Don't miss this chance for for long-term conversion of shoppers and sustained sales."