The Rise of Private Label Brands. Then and Now.

THEN

1. Limited media outlets meant that manufacturers could reach a large percentage of the American public through the "Big 3" - ABC, NBC, and CBS, driving home a message of value or prestige in purchasing branded product.

2. Retailers were fragmented.  Grocery stores were independent (mom and pop) or part of much smaller chains than today.  As such, retailers did not have the purchasing power or clout to influence manufacturers.

3. Due to the strength of their brands, manufacturers could dictate placement and price with retailers.  Retailers who didn't comply would find themselves without key brands.

NOW

1. Fragmented media means that manufacturers must work harder and smarter to effectively market product through a myriad of distribution channels via television, radio, publications, billboards, and interactive advertising.

2. With retail mega-chains like Wal-Mart, the mom and pop stores were slowly driven out of business.  As the retailers grew, so did the purchasing power. 

3. Retailers won the hearts and minds of consumers nationwide with rock-bottom prices. 

With every new big box retail store came even greater market share.  Soon manufacturers found themselves beholden to retailers, who represented a very large percentage of their branded product sales.  In an effort to continuously drive out cost, retailers began to squeeze manufacturers, demanding cost reductions in key areas.  Those who did not comply were dropped, and many went out of business.

4. In a constant effort to drive revenue and reduce cost, retailers began to explore private labeling certain products.  They started with commodity items (milk, butter, tissue), but began expanding into other product categories.

5. Unlike branded manufacturers, retailers don't have the added marketing expense, as they already have a captive audience walking their aisles.   Some retailers emphasize value (Wal-Mart's Great Value Brand), while others emphasize quality (Target's Archer Farms brand).