Private brands continue strong

Aldi's exclusive range of household cleaning products

Private brands -- such as the brands marketed by grocery chains and clothing retailers -- continue to be strong sellers, year after year. Even as the recession reverses course and growth returns, consumers have learned through experience that private brands often are excellent alternatives to manufacturers' brands. And of course private brands, generally priced lower than manufacturers' brands, represent the majority of products at deep-discount grocery giants such as Aldi and Lidl.

Consumers recognise that private brands can offer quality, not just value. Aldi's coffee recently was named the best in a taste test that included Starbucks, Costa and other well-known global brands. Marks & Spencer's private wine brands took home multiple medals at this year's international wine challenge, where a number of grocery chains were awarded medals.

The image and reputation of the marketing entity makes a difference in how its private brands are perceived. Sainsbury is launching its private brands in an online retail environment to reach consumers in China who are interested in the cachet and quality of foreign brands.

Private brands are increasingly a key point of differentiation in the intensely competitive grocery industry, where supermarkets are using price promotions to attract shoppers week by week. Because private brands generally have higher profit margins, they can help retailers compete on the basis of value and quality.