Fast forward 20 years.
What will the store shelves look like?
For foodservice operators, what will your delivery look like?
It seems that quarter after quarter, private label brands continue to solidify
themselves in the minds of consumers in terms of quality and price.
Consumers no longer need or seek brand comfort as they
did in years past. Today, we have a vast
network where people search and share information instantaneously. Bad product experiences are shared with the
world through websites, blogs, Facebook, Twitter, and many other outlets in
milliseconds.
We no longer seek comfort in brands. We simply seek the truth, which is now at our
fingertips.
So how exactly do manufacturers compete in this new paradigm?
There seems to be three choices:
If you can't beat em', join em
We’re already seeing this with numerous
manufacturers. In many cases, they have
been strong-armed by powerful retailers and distributors to become less of a
brander and more of a manufacturer, supplying items that compete head-to-head
with brands they built up over the years.
Insane or a survival necessity?
Be
everything to everybody
The hybrid approach.
Some companies do a little private labeling on the side. While this seems to work well in the short term,
it does nothing but empower the retailer (or foodservice distributor), adding
strength to their bottom line, and making it more likely that the branded
product will at some point be displaced.
Beat
em’ through Innovation
Numerous manufacturers (Proctor and Gamble comes to mind)
have decided that the best way to long term survival is to constantly innovate,
creating products that “wow” consumers through true product differentiation. They realize that products must be “Purple
Cows” (Seth Godin), rather than the same old monochrome Holsteins that everyone puts out
to pasture.
Companies like this also embrace the Internet and new
media, fully understanding the vast power of word-of-mouth marketing through
online communities, social networks, and blogs.
They use this powerful new medium to their advantage, and monitor
conversations on the web to gauge consumer sentiment, proactively intercept
issues and quickly remedy problems.
But it all starts with product differentiation. “Me too” brands will face a certain
death.
The writing is more than on the wall. It’s been written in a gigantic, neon pink
indelible marker.
I truly do not believe we’re heading to a world without
branded products, but we’re certainly looking at major changes in the years to
come.
So what do you think the world will look like in 20
years?
How should manufacturers respond to this onslaught?
