Product Branding

Types of Brands Brands are classified by who owns them: Manufacturers, Retailers and Wholesalers National Brands Private Brands Generic Brands

National Brands Owned and Initiated by MANUFACTURERS -Also called Manufacturer Brands- Examples include: Coca-Cola products Kellogg’s products GM automobiles Maytag appliances Tylenol

National Brands They generate the majority of sales for most product categories. For Example: 70% of food products - National Brands 65% of all appliances - National Brands 80% of all gasoline - National Brands 100% of automobiles - National Brands

National Brands They identify a given product AND indicate a standard quality and price. They appeal to customers who want: consistent quality dependable performance status do not want to take risks with products

Types of Brands Brands are classified by who owns them: Manufacturers, Retailers and Wholesalers National Brands Private Brands Generic Brands

Private Brands Owned and Initiated by Wholesalers and Retailers – NOT Manufacturers The manufacturer’s name does NOT appear on the product. Ex: Meijer Brands: Meijer, Shop Force, gfm Sears Brands: Kenmore, Craftsman, Die Hard

Private Brand Appeal to customers who want quality and performance similar to national brands BUT at a lower price. Private Brands often become so popular they rival the National Brand -Kenmore may sell as much as GE-

Private Brand Popular with Retailer because they have HIGHER GROSS MARGINS (PROFIT) The cost for the retailer is lower than National Brands therefore they can make more profit. EX: Washing Machine: Maytag Kenmore Selling Price: $1000 $900 Cost to Sears: $700 $500 Profit to Sears: $300 $400

Private Brand Product Better Controlled by Retailer. Retailer has power NOT Manufacturer Why is this? No Competition. (Kenmore only sold by Sears) (Maytag sold by everybody) Therefore customers become LOYAL to Sears …Not the Manufacturer (Maytag)

Types of Brands Brands are classified by who owns them: Manufacturers, Retailers and Wholesalers National Brands Private Brands Generic Brands

Generic Brand “NO FRILLS” Product Don’t Carry a Brand Name at all Generally these brands are sold in Supermarkets and Discount Stores Often Priced 30-50% lower than national labels (owned by manufacturers) and 10-15% lower than private labels (owned by retailers)

Generic Brand Why do they cost so much less ??? NO ADVERTISING Typically sold in plain white box with simple lettering (no brand listed)

Generic Brand Ingredients in Generic Brands are similar to National and Private Brands MUST WAIT FOR PATENTS TO EXPIRE Ex: Prescription and OTC Drugs Generic Brands have same active ingredients as “Brand Names”