I’m a bit bemused by the complaints I am hearing from retailers that times are tough. Sure they aren’t easy. Life isn’t a bowl of cherries in any sector right now, but that’s just progress. In fact, if I were a retailer who was finding it tough, I’d think I’d keep quiet about it, because it only suggests that I wasn’t smart enough a few years ago to focus on developing my brand. Make no bones about it, we’re not going to get back to the days of milk and honey so you might as well be grown-up about this and see what you can make of what you have. And the thing is, there are loads of opportunities for retailers who invested in their brands and can now get their heads from up their backsides and work that to their advantage.

If its innovation you are after (and who isn’t) international markets have been opened up by e-commerce, while the new capability offered by things like Bluetooth Low Energy (Beacons) and mobile mean that physical stores can do stuff that e-stores struggle to achieve, so there’s no limit to the innovation that’s possible there.

With the struggle between retailers and manufacturers for brand dominance (that old argument about whose brand dominated the buying decision) now consigned to history, it’s clear that the retailers who stood their ground and invested in their brands have triumphed. If you are still unsure that this is so consider how Tesco and Waitrose own-label products are now driving easy revenue, gaining exposure for and further building the authority of their brands as they stand-alone on the shelves of other retail groups around the world.

I’ve always said that one of the most powerful arguments for investing in your brand is that a strong brand gives you more opportunities and as if to underline this Primark this week announced their expansion to the US underlining the concept of UK “cheap chic” in the age of disposable fashion. However, the really interesting story to my mind is that of down-market supermarket group Lidl’s decision to launch their fashion range.

Who would have thought only a few years ago, that a no-frills supermarket could make a success of a fashion range? But Primark have established the segment and there’s no reason to suppose that Lidl’s entry won’t be an outrageous success – as long as whoever is in charge of the Lidl brand ensures that the fashion products maintain and leverage its core attributes. Get this right and the fashion products will further enhance the brand, driving Lidl store sales and the products will gain early acceptance because of the brand. It’s a classic symbiosis.

It’s seemed just logical to me since the early days of own label that the name over the doors of retail outlets would turn into something bigger, embracing products that would, in turn, sit well on the shelves of other retailers, thereby providing revenue growth and further enhancing the authority of the brands concerned (both retail and product). Retailers who instead of cow-towing to their suppliers’ have taken the stance that they are the endorsers of the product brands and not the other way around,, are now firmly in the driving seat. Consumers accept the brands that retailers stock, seeing them as representing the core values of the retail brand. (“if its good enough for Sainsbury’s it good enough for me”). When that same retailer introduces own label products they are seen by consumers as the absolute manifestation of the brand (“If it’s a Tesco product I know its good value at that price point”) and this carries through to where they see these products on the shelves of other stores (“I’m not sure about this store, but these are Waitrose products, so I am assured of the quality”). There’s a double pay-off for the host brand too in that they inherit a little of the values of the bigger brand and can effectively short-cut the process of brand development (“I’m not sure about this brand, but they share the Tesco values that I believe in so I guess I’m safe here”).

Lidl's £4 scent

Is it too late if you failed to get to grips with brand development a few years back? We’ll, I guess not if you got your skates on, but the trouble is that if you missed the boat then you are probably lack the dynamism necessary to catch up, brand development, after all, is a transformation process and your progress depends wholly on your culture.

Phil Darby
September 15, 2014

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