GLG News Analyses of the following article:

Is Wal-Mart onto something?

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Published at: www.homechannelnews.com

Christopher RameyPresidentAffluent Insights

Wal-Mart’s move to private label is merely a reflection of societal trends.

July 7, 2009

Private label is a brand unto itself.  Wal-Mart’s move to private label is remarkably similar to any other brand initiative.  Rather than moving upscale with unique selling propositions, private label products accept commoditization and manufacture the least expensive product possible.  

Will American consumers prefer private labels as Europeans do?

June 25, 2009

Analysis by: GLG Expert Contributor

People in Europe prefer private labels for different products, as retailers can offer them with their own brands, better deals eliminating several merchandising expenses. Some people think that it is better to buy a product, that a prestigious retailer has approved (and supported with their brands), getting more quality for a lower price, instead of a brand that has been top of the market because of it’s spends in advertising, that finally raises the price, without a perceived benefit for consumers. How can this work in Walmart?

Wal-Mart Great Value Brand Revamp Signals Mainstream Adoption of Private Label Products

June 25, 2009

Analysis by: GLG Expert Contributor

Looking back, retail observers and pundits will identify the current recession as a tipping point when private label products emerged from alternative status and into the mainstream.  Wal-Mart's "Save Money. Live Better." value proposition has been incredible successful and was a natural extension of their longstanding EDLP pricing strategy.  The fact remains that consumers will pay more than their reference price for a product if they perceive a brand to have differential value over a like item.  This applies to private label brands as well.  If Wal-Mart executes the revamp successfully it could significantly increase traffic, order size and conversion. 

Mega Retailer Private Label Can Be Effective

June 25, 2009

Analysis by: GLG Expert Contributor

The virtue of private-label for the consumer is a similar product at a better value. The virtue for the retailer is greater profits.

John WilkersonExecutive DirectorBELLWETHER SERVICES, LLC

Private Label Marketshare Gains Generates Additional Private Equity Supply Chain Pressure

June 24, 2009

According to the source article, Wal-mart is in the process of upgrading its private label business.  This profit push will bite into branded product marketshare and may cause retail supply chain challenges downstream.  How does a P&E firm with branded products position itself? 

Increasing Challenges Facing Branded Consumer Goods Manufacturers

June 23, 2009

Analysis by: GLG Expert Contributor

Brand goodwill and brand perceived value drive the sales and profits for many Fortune 500 consumer goods manufacturing companies as well as thousands of other consumer goods manufacturers.   These manufacturer's brands are under siege by retailers and wholesalers throughout the distribution channel.  There is not a major retailer or wholesaler in the USA who does not incorporate their own private label brand program as part of their overall sales and marketing strategy.  The bottom line is that retailer and wholesaler private brand sales grow at the expense of the consumer goods manufacturer's brands, costing the manufacturers sales and profits and reduced brand equity.   There are several strategies that branded consumer goods manufacturers can employ to address the challenges to their brands.   Without effective strategies to address these challenges, brand name manufacturers face tough times in the years ahead.