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Getting over prejudice When it comes to choosing a product, the guarantees associated with the names of major retailers like Hipercore, El Corte Ingl�s, Carrefour, D�a and Alcampo are enough to make shoppers drop their prejudices in favor of name brands in exchange for discounts of as much as 50%.
Marketing experts say consumers don't pay attention to brands when the purchase is a sure thing or when they are buying goods that are perishable, generic or of low value. On the other hand, a recognized and valued label differentiates the product from competitors, reflecting the quality of the product.
Recent figures from PWC Consulting show that house labels have a market share of 22% in Spain, and this is expected to double to 45% over the next three years. This rise stems from the takeover wave under way in the Spanish retail sector. This has already been observed in Britain, where 45% of consumer purchases are of house label products.
However, in the United States, powerful marketing of brands is keeping house labels in check. The latter represent 20% of the market in that country, so that one of every five products purchased by consumers are the store's own brand. In Germany the share is 29%, France 24%, the Netherlands 21% and Italy 13%.
Competitive prices One of the main factors behind the growth of house labels is their high profitability for merchants. Wholesales are more and more demanding with producers, and this fattens margins for large retailers. Through agreements with large distribution companies, stores can offer their customers prices that companies could not match in traditional circuits.
Unlike in other sectors such as cars, clothing or cosmetics, the power of image is not strong when it comes to food. Of the 10 most valued and well-known brands, the only one involving food is Coca Cola, although it is indeed way up high. Far below among the top 50 are half a dozen other food products.
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