Product Specification: A Shield in the Battle Against Private Label at Retail

By Vincent Young

As long as I can remember, only two brands of toothpaste have mattered – Crest and Colgate. I use Crest. Why do I use Crest, you ask? Because, as a very young child, our family dentist used Crest during my annual check-up and he then gave it a tacit recommendation that we should be using it too when he gave me a sample tube of Crest (along with floss and a new toothbrush). From that moment on, my Mother would look for the Crest brand of toothpaste for our family to use.

When a brand is either directly or indirectly specified as “appropriate for optimal effectiveness” by an expert or by a complimentary good, then your brand’s ability to wield assortment, pricing, and promotional power at retail increase significantly.  Sounds like a recipe for Retail Leverage (or inoculation against private label).

So how do you protect yourself and build Retail Leverage?

BUILD A SHIELD THROUGH PRODUCT SPECIFICATION:

Leveraging the power of specification should be seriously considered as a part of the product commercialization strategy of all national brands, if retail is your path-to-market of choice. Rather than setting aside monies for “launch” efforts that are anchored by the traditional advertising campaign or national consumer promotions, it may make sense to plow those same funds into sampling, co-packing, or buying favor with key sources of product specification that can be leveraged with retail to support your desired assortment or positioning strategy. If your budgets are tight, then seriously consider barter or putting free product samples in the hands of key, relevant specifiers as a way to establish your brand as a “call brand” prior to entering the world of retail.

While there are many ways to approach product specification as a means to gaining leverage at retail, there are three sources of product specification that seem to give brands the greatest advantage at retail.

THREE SOURCES OF PRODUCT SPECIFICATION:

Product Specification Source #1 – Schools: When the school specifies “Elmer’s Glue” on its school supplies list, then we, as usually very logical parents, would never consider buying any other brand of something as generic as glue. The power that Elmer’s has at retail to minimize the threat of retail substitutes or private label is greatly enhanced by being specified on most elementary school supply lists. If your product is one that participates in a category that is relevant to teachers of students, then you should devise a strategy to become a specified brand by schools before approaching retail with your next new product or line extension.

Product Specification Source #2 – Physicians/Veterinarians: In addition to the aforementioned example of toothpaste, consider the power that various dog food brands and contact lens solutions providers have at retail given their sampling and specification footprint with the medical professional industry. Brands ranging from Science Diet and Eukanuba Dog Foods to Ciba-Vision and Johnson and Johnson have a tremendous advantage at retail given the reluctance of most consumers to switch away from the brand recommended by their trusted medical experts.

Product Specification Source #3 – Complimentary Goods further Up the Value Chain: One of the best examples of product specification as a form of retail leverage is represented by Avery Dennison. At its peak, Avery commanded as high as 88% market share in the “inkjet and laser labels” category at retail. In addition to offering a broad variety of relatively easy-to-use products (identified by name and template number), the Avery brand name and its label templates were pre-specified in the “Labels and Envelopes” function within Microsoft Office software. Avery’s product and brand specification model through its integration with Microsoft makes Avery Dennison virtually untouchable at retail As a result, Avery has long maintained its position as the dominant brand of labels within the mass, office supplies, and education channels.

RETAIL LEVERAGE TAKEAWAYS:

The next time your new product approaches the commercialization phase of product launch, it may be worth your while to gather your team together to create a “specifier’s map” as part of your brand’s go-to-market strategy/plan. Determining a path to becoming specified by credible sources of influence may be far more important than optimizing the traditional media mix or even securing a celebrity endorsement when selling through retail.

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