The House (Brand) That Didn’t Collapse
In 1986, it was thought that house brands was a fad.
But easy as they are to spot, generics – bargain-priced merchandise sold without a brand name or, for the most part, advertising – are becoming harder to find.
Introduced in the mid-1970’s when inflation was high, the no-name products grew in popularity for a few years. But since 1983, their sales have steadily declined – almost to the point of extinction today in many supermarkets. Among the reasons, say analysts, are an improved economy, more price-cutting promotions by brand-name products and persistent consumer doubts about the quality of generic items.
”Generics are a much less important category than they were a few years ago,” said Michael Rourke, a vice president at the Great Atlantic and Pacific Tea Company. ”The consumer has lost interest.”
So, for the most part, have retailers. A.&P., for example, has reduced the number of different generic products it carries to less than 100 from twice that number several years ago. At the same time, it has put an increased emphasis on selling national brands. Generic products, after all, carry razor-thin markups – sometimes just a penny or two per item.
What’s really interesting is when house brands are not only competitive with name brands, but actually better. Safeway has outstanding provolone cheese for some reason. Walmart has good salsa (I know, right?). Kroger has a Mountain Dew clone, Citrus Drop, that I often prefer to Mountain Dew. Food Lion has outstanding sliced meats (packaged stuff, not deli).