DRUG CHAINS SEEN UPGRADING STORE BRANDS

CHRISTINA VEIDERS

CHICAGO -- Eckerd Drug's Spa Basics and CVS' Down to Earth store brands are evidence that chain drugs are developing more sophisticated programs aimed at achieving important points of difference from the competition.

David Biernbaum, president of David Biernbaum Associates, Chesterfield, Mo., who spoke this month at the Private Label Trade Show during a seminar on retailing trends in chain drugs, pointed to the two chain drug lines as examples of how private label has developed from the days when it was treated simply as a generic that competed on price alone.

"The best private labels at chain drugs today help to define the retailer's own point of difference. Price alone is not a point of difference. National brand equivalency is not a point of difference. Quality is not a point of difference anymore because every supplier has technology to make all products about the same," Biernbaum stated. He said that Eckerd's Spa Basic's line is merchandised in beautiful counter displays set to capture impulse purchases. "It looks like a designer line of products that you'd find in department stores. It gives Eckerd a designer image and point of interest," he said.

Biernbaum mentioned that along with CVS's Down to Earth line, the retailer merchandises 1,000 stockkeeping units under the CVS label. The chain has become creative in its store branding program by running a national sweepstakes to drive traffic. The sweepstakes offered consumers a chance to win a trip to Italy, or other luxury products. CVS also merchandises its private label through store branded gift boxes. The retailer fully supports its private-label program through TV commercials, newspapers ads and in-store signs.

The store brands mentioned above demonstrate that some chain drug retailers have made the transition from producing copy-cat knockoffs to treating store brands as "real" brands, said Biernbaum.

"We know 'follow the leader' has become nothing more than a costly wild goose chase that seldom rewards us and it never builds brand equity," he added.

Biernbaum said chain drugs' efforts behind private label should work to sustain the image of the store itself. "The store brand should serve as a restatement of the store's own identification while building customer loyalty that goes far beyond price," he added.

As a consultant to the private-label industry, Biernbaum said he is working with a regional Canadian drug chain that is about to embark on a point-of-difference brand marketing program that will closely tie the chain's new store design into its store brands.

The chain, which he declined to identify, is creating a 1950's nostalgic look using black and white floor tiles, and big murals of soda fountains found in drug stores of the past. The theme and look will be extended to the chain's private-label packaging, which also will be in black and white to reflect the design elements in the stores.