In today’s economy, the retail industry is seeing consumers engage in two shopping trends. Consumer coupon use is increasing and there is a push to buy store label and generic brands.
It’s a battle of who can provide the best customer experience with the lowest price. Name brands can use coupon and in-store promotions to reach consumers. Simultaneously, store and generic brands can offer competitive lower prices to attract consumers away from name brands.
In a downturn economy, shoppers are less likely to splurge on trying the newest line of products. Name brands will continue to stick with their established brands, who can compete against generics. Name brands have a potential to tap into consumer brand loyalty through coupon saving programs and advertising. Brands need to have a customer experience program in place to measure their campaign effectiveness. Keeping consumers highly satisfied will the be key to pull consumer’s attention away from the competitor.
Across the board, store brands and private labels have an advantage with their lower prices. A consumer may be willing to try the off-brand if the savings are significant. Store and generic brands may get consumers to try to products, but they won’t keep the consumer unless the experience was significantly better than the name brand product. This is the time for store brands to increase consumer research to know how to improve their products.
The visible shopping behaviors benefit competing labels: Name brand vs. store brand. The final test will be with the customer experience.
