Sobeys Resets Private Brand Portfolio
Five years after it launched its multi-tier Compliments private brand line, Sobeys Inc., Stellarton, Nova Scotia, has remixed its private brand portfolio to include a redesigned premium line now called Sensations by Compliments (replacing Compliments Sensations brand), and has issued a new value brand called Signal (replacing Compliments Value brand). In addition, Sobeys launched a new hard discount store format in May 2010 with the opening of eight FreshCo stores in the Toronto trading area.
Consumer Research
To measure how customers were responding to Sobeys multi-tier brand offerings during the downturn in the economy, in November 2008 the retailer undertook a major consumer research study.
“Given the changing economic climate, we wanted to know how to respond meaningfully to customers within our own private brands,” says Belinda Youngs, chief marketing officer for Sobeys Inc.
“What the research told us — which was very interesting — was that we had the three-tier strategy right in terms of good, better, best. And customers really liked the added value of our Compliments sub-brands because they have been developed to respond to consumer trends. The sub-brands include: Compliments Organics, Compliments GreenCare, Compliments Balance (for health and wellness) and Sensations by Compliments (premium). That was all reassuring.
“Then we realized that we had two things that we needed to change to fully optimize the program in order to take it to another level.
“One was the fact that there was some confusion among customers between Compliments Value and Compliments. We found that the shear breadth of range of our entry price point category as well as the fact that it had the same name of our national brand equivalent for less range was holding back growth of our Compliments brand.
“We also learned that customers perceived our premium private brand line to be limited and they wanted too see us offer a broader group of categories that had higher household penetration so that it was more accessible to them on a more meaningful basis.
“As a result of this research, our Compliments entry price point brand was replaced with Signal – a more focused, smaller number of products in high penetration categories. We analyzed all of the categories to understand where it was most important to carry an entry price point. This is what gave rise to our Signal private brand. “Your signal for our lowest prices.”
Under this brand reshuffle, Sobeys has replaced 900 Compliments Value items with 250 Signal products.
Growth of Sensations
“At the same time, we also significantly increased the product development and the SKU base for our Sensations by Compliments premium private brand.
We completely changed the product mix. We are still rolling through product development, but we will have about 1,000 items under our premium brand.
In addition, we increased our Compliments assortment of national brand quality for less.
We are making these fundamental changes to fully optimize our private brand program. This is a two-year execution and we are about 60 percent complete. We also took the opportunity of this change to introduce a next generation design across all of the different private brand lines.”
When the changeover is completed, Sobeys will have in total about 5,000 SKUs under its Compliments and Sensations by Compliments brands.
Quality Benchmarks
To ensure that Compliments brand products meet customer needs in terms of quality and taste, Sobeys benchmarks each one of its products through its Sensory Taste Panel that is made up of everyday consumers who have been trained to judge the taste, texture, aroma, and visual appeal of each new Compliments product that is brought to market.
Editor’s Note: For a more in-depth look at Sobeys new private brand initiatives and store format, see Sobeys cover story in our upcoming PL September 2010 issue.
