Own-label standards slipping: OLN poll

29 May, 2015

Suppliers’ estimation of supermarket own-labels is slipping, OLN's exclusive Wine Report poll of UK agents and distributors has revealed.

The number who see them as good or excellent has fallen to 49%, from 68% in 2014 and 71% the year before. Twelve per cent of suppliers see supermarkets’ own-brands as poor or very poor.

Suppliers said there were enormous differences from retailer to retailer. Morrisons and the Co-op won praise for their offers, while Sainsbury’s “needs to improve significantly”.

GM Drinks managing director Marc Patch says: “Those that know and understand the importance of own-label and exclusive wines tend to have an excellent range. Some of our customers see this as potential growth so while the focus is good, more is yet to come.”

And Nick James at Pol Roger comments: “I am not normally exposed to these, but whenever I am I remain pretty unimpressed. What I see from the likes of Aldi, however, tends to be up a grade in quality.”

While own-labels are mainly seen as a core range of standard wines that are an alternative to brands (61%), and entry-level (33%), they are also seen as a place for innovation (33%), brands in their own right (29%) and a way for supermarkets to wield more control over the marketplace (22%).

Concha y Toro UK communications head Ben Smith says: “It’s not the same in every retailer, but the more switched on have used them to help build consumer confidence.”

And an anonymous supplier adds: “Own-label wines offer the consumer the opportunity to experiment with new regions, varieties and styles at a reasonable price and with a certain level of confidence – if the retailer has put their name to the bottle, they have faith in the wine and this filters down to the consumer. The opportunities are there for own- labels to push the boundaries and introduce a little innovation.”

Meanwhile, some believe exclusive labels are there purely to be discounted.

Australian Vintage general manager for the UK & Europe Julian Dyer says: “In the past few years they have taken some space away from weaker brands and some own-label, but really a lot of these exclusive wines just exist to promote. As the market moves to more of an everyday price model they are difficult to justify.”

The main role of brands is to give reassurance to those who shop across a number of retailers.

James says: “Brands are only in the big four because they’ve ‘paid and played’. Yes, they give an element of reassurance to the consumer, but they also serve as a marker point for the supermarket’s own-label.”

But Dyer says: “The brand has to mean something and to deliver a unique point of difference, otherwise it is just a label and then just a commodity. So a brand has to over- deliver on quality, style, originality, consistency and added value to be relevant. It isn’t a question of which is best, own-label or branded – they have complementary roles to fulfil and both are needed.”

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