<p>By Doug Baker, Vice President, Industry Relations, FMI</p><p><img src="https://www.fmi.org/images/default-source/homepage-curation-tiles/private-brands-2023_sm.tmb-large-350-.jpg?sfvrsn=2006b578_1" style="float:right;margin:10px;" alt="private brands 2023" class="-align-right" sf-size="90561" /></p><p>Innovation in the private brands industry is often used to describe new or revamped products. But that seems like a limited look at innovation and its possibilities. I decided to seek out a dictionary definition of innovation after hearing the word used
countless times in the private brands sector.<br /></p><p><i>Innovation (from Oxford Languages): “A new method, idea, product, etc.”</i><br /></p><p>Notice that “product” is only one part of that definition.<br /></p><p>FMI’s latest <a href="https://www.fmi.org/forms/store/ProductFormPublic/power-of-private-brands-industry-2023"><i>Power of Private Brands 2023: Innovation that Drives Winning Private Brands</i></a><i> </i>report takes a deep dive into how innovation
can drive private brands success more broadly across the business. The report, based on a survey of private brand executives in the food industry, is the first of a two-part series. Our research is overseen by the retailers, suppliers and service
providers on the Research and Education Committee of FMI’s Private Brands Leadership Council.<br /></p><h5>Industry Gives Thumbs Up to Broad View of Innovation</h5><p>FMI developed a broad definition of innovation for the purposes of this survey and asked industry executives to weigh in. Here’s how this was communicated to survey respondents.<br /></p><p><i>Innovation in private brands is often thought of in terms of developing new products. But a broader definition of innovation focuses on addressing unmet needs across the business, such as in packaging, products, categories, flavors, branding supply, purchasing, logistics, inventory management, merchandising, marketing or almost any other aspect. Given this broader definition, how important is innovation within the private brand business?</i><br /></p><p>A hundred percent<b> </b>of survey respondents said it’s important to pursue innovation along these lines. <br /></p><p>Respondents also were asked to use the same definition to assess where the private brand industry stands today in making use of innovation. About 90% said the industry is at most “somewhat” far along with innovation. This indicates to me there’s
a lot more room for progress.<br /></p><h5>Three Ways to Make Progress with Stepped-Up Innovation</h5><p>The report examines three ways innovation can help accelerate the private brands industry. We received insightful industry feedback for each of the three areas. <br /></p><ul><li><b>Drive Consumer Purchases: </b>Top strategies identified include emphasizing value/price and appealing to younger consumers.</li><li><b>Enhance Retailer/Wholesaler Strategies: </b>Key strategies include enhancing brand development and new product development.</li><li><b>Advance Suppliers, Supply and Assortment: </b>Top approaches include engaging more closely with existing suppliers and making longer-term commitments to supplier arrangements. <br /></li></ul><h5>Collaboration is Crucial to Success</h5><p>The findings reflect not just overall industry feedback, but also how retailers and manufacturers sometimes differ in their opinions. For example, manufacturers were more likely to emphasize the need to bring suppliers into the ideation/development process.
Retailers were more likely to underscore the importance of establishing clear metrics and expectations in supplier arrangements.<br /></p><p>The industry needs to collaborate to produce win-win results. Here’s a compelling point to drive motivation: 82% of food retailer and manufacturer respondents plan to increase private brand investments moderately or significantly in the next two
years. That offers a lot of opportunity to accelerate private brand innovation — if it’s done well. <br /></p><p>Private Brands Innovation Discussion</p><p>Nothing sparks innovation more than a good discussion! Join us on June 8 at 2:00 p.m. ET as we dive into the Power of Private Brands 2023 findings more in a digital seminar discussion. I’ll be joined by David Orgel with David Orgel Consulting LLC,
Clay Dockery, vice president of corporate brands for Massimo Zanetti Beverage USA and Pam Ofri, director of product development and operations for own brands with Wakefern Food Corp.<br /></p><p><a href="https://www.fmi.org/forms/meeting/Microsite/2023_private_brands_innovation" class="button">Register Now</a><br /></p><p><a href="https://www.fmi.org/forms/store/ProductFormPublic/power-of-private-brands-industry-2023" class="button">Download Power of Private Brands 2023</a></p>
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