Followup – What’s in a (Brand) Name?

A couple weeks ago, I was called a fool and attacked for some basic advice I thought was uncontroversial – namely, buying generic items in your grocery store saves you money for what are often identical products.

One comment at the end of 7 Things You Should Always Buy Generic insisted I was “badly misinformed.” One even wrote, “Wouldn’t it be nice if know it all journalists really did know the facts about things, before they went off and jotted down their informative articles?”

Thing is, I did research the facts. I went to the grocery store, I bought store-brand items, and I used them. But I understand the strong feelings – if you spend more money on brand names for the same quality items that you could get for less, you might think I’m calling you a spendthrift. It’s also possible that you can spot differences in some generics that I can’t.

But this week, it turns out I have a powerful ally in my opinion: a consulting firm for brand-name manufacturers.

In a new report from professional services company Deloitte titled The Battle for Brands in a World of Private Labels – private labels are in the same category as generics and store brands – the big news was this…

Store brands (generics) are gaining market share at the expense of national brands. Between 2006 and 2009, market share rose across 74 percent of products in the personal care, household goods and food and beverage categories in the United States.

Interestingly, this report isn’t intended for consumers, but for the makers of those brand-name products for sale in our grocery stores. And here’s a startling admission that many of my critics just refuse to acknowledge…

All too often, retailers are able to take national brand products to third party manufacturers, or even the branded company, and develop a private label version with similar packaging.

That’s just one reason why brand names are suffering, the report says. It then issues this panicky call to arms…

In the battle for the customer, store brands are winning. Unless manufacturers can create a clear reason in the consumer’s mind that the brand is more important than the store when making their choices, the manufacturers are bound to lose margin to the store.

And the advice for those name-brand manufacturers? Stop discounting their products…

National brands should pull back price-related promotions that can decrease consumers’ reference price points. When developing a promotions strategy, consumer product companies should more actively consider non-price-related promotions.

In other words, if you’re a name-brand manufacturer, the message is to avoid competing on price, because you’ll lose. Instead focus on “non-price-related promotions” and otherwise try to “create a clear reason in the consumer’s mind that the brand is more important.” And how do they do this? Advertising. How else can band-name goods perpetrate the myth that they’re somehow worth the extra money, even when the generic versions are often made with the same process in the same manufacturing facility?

The moral of the story: At least try alternatives to the brand-name goods you usually buy. As some Money Talks News readers have commented, they don’t like the taste of generic foods, or bottled water, or cleaning products. That’s fine – at least they tried them. But if you haven’t yet, this is as good a time as any. As the Deloitte report concludes, “Store brands are here to stay.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
5 Products You Should Never Buy Generic
5 Products You Should Never Buy Generic

Generic products are a great way to save money, but sometimes the brand-name version is clearly superior.

5 Ways to Avoid Taxes on Social Security Income
5 Ways to Avoid Taxes on Social Security Income

Here’s how to minimize and delay the chunk that Uncle Sam claims.

The 3 Biggest Regrets of Retirees — and How to Avoid Them
The 3 Biggest Regrets of Retirees — and How to Avoid Them

Rescuing a retirement from regret starts with these steps well before it’s time to quit working.

7 Surprising Features That Boost Your Home Value
7 Surprising Features That Boost Your Home Value

You can add value to your home without hiring a contractor to do expensive renovations.

8 Common and Costly Homebuying Myths
8 Common and Costly Homebuying Myths

Think you’re ready to buy a house? Don’t fall victim to these rookie mistakes.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
7 Kirkland Signature Items to Avoid at Costco
7 Kirkland Signature Items to Avoid at Costco

Even if it seems you save a bundle buying Costco’s Kirkland Signature brand products, they may not be the bargain they appear to be.

Am I Eligible for My Mother’s Social Security Benefit?
Am I Eligible for My Mother’s Social Security Benefit?

Can an adult daughter tap into her late mother’s benefit?

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

This Surprise Factor Can Raise Your Risk of Dementia
This Surprise Factor Can Raise Your Risk of Dementia

Nearly half of U.S. residents may face this threat.

Organize Your Home With These 10 Thrift Store Finds
Organize Your Home With These 10 Thrift Store Finds

Resolve to be clutter-free in 2021 with these secondhand purchases.

These Major Appliances Got the Worst Reviews in 2020
These Major Appliances Got the Worst Reviews in 2020

Consumer Reports says these home products got the worst ratings from experts.

This Gas Station Scam Is Victimizing More Drivers
This Gas Station Scam Is Victimizing More Drivers

For the second straight year, a growing number of Americans believe they’ve fallen prey to this scam.

11 Laws You Could Be Breaking Without Knowing It
11 Laws You Could Be Breaking Without Knowing It

Seriously? Fibbing about the weather is a crime? This and other little-known legal traps await the unwary.

These Are the 3 Best Used Cars You Can Buy
These Are the 3 Best Used Cars You Can Buy

These vehicles boast reliability, safety and long-lasting value.

13 Things Seniors Can Get for Free — or Almost Free
13 Things Seniors Can Get for Free — or Almost Free

There are many ways to get cheap or free services and goods after reaching a certain age.

6 Legal Documents Retirees Need — but Don’t Have
6 Legal Documents Retirees Need — but Don’t Have

Few retirees have all of these documents that are crucial to their golden years — especially during a pandemic.

Is This Treatable Condition Causing Your High Blood Pressure?
Is This Treatable Condition Causing Your High Blood Pressure?

Researchers say too many doctors are overlooking this potential source of hypertension.

11 Generic Products You Should Buy at Costco
11 Generic Products You Should Buy at Costco

Not all generics are worthwhile, but these are among the best from Costco’s Kirkland Signature brand.

Internet Providers Can’t Charge You for This Anymore
Internet Providers Can’t Charge You for This Anymore

Starting this month, your ISP no longer can bill you for this fee.

3 Cable TV Companies Hiking Prices for 2021
3 Cable TV Companies Hiking Prices for 2021

Still married to your cable company? Hold on to your wallet!

8 Tips for Retiring Comfortably on Social Security Alone
8 Tips for Retiring Comfortably on Social Security Alone

It’s never too early to start learning how to live well while living on less.

15 Painless Ways You Can Cut Costs in 2021
15 Painless Ways You Can Cut Costs in 2021

Follow these tips to save, so you’ll have money for things that really matter.

9 Small Expenses That Are Bleeding Your Budget Dry
9 Small Expenses That Are Bleeding Your Budget Dry

Keep more of future paychecks by eliminating these budget-busting unnecessary expenses.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.