More digital real estate needed for store brands?

Grocery retailers could do more to spotlight private brands on their e-commerce websites, according to mystery shopper research released today by FMI-The Food Industry Association finds.

As part of FMI’s “Power of Private Brands 2021: Accelerating Private Brands in Grocery E-commerce” report, digital commerce consultancy FitForCommerce “mystery shopped” the websites of 25 food retailers and detected a visibility shortfall for store brands in various aspects of the online shopping experience. Based on the findings, the consulting firm identified 10 areas where food retailers could more effectively target consumers with private-brand offerings.

Areas of improvement start with the homepage, where just 20% of the retailers examined — including conventional supermarkets, limited assortment grocers, natural food stores, warehouse clubs and mass merchants — promoted private labels. Only 16% of retailers featured store brands in a dedicated section on their homepage, and 48% didn’t highlight private brands in the header or footer of their sites.

Similarly, just 40% of food retailers included private labels in their site’s main navigation bar or category dropdown menu. And while 88% of retailers enable shoppers to refine search results by brand — and 96% include store brands in the filter — private labels can “get lost in a sea of brand names,” often sorted in alphabetical order, FitForCommerce explained.

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By not showcasing store brands at primary online customer touchpoints, grocery retailers are missing out on key opportunities to promote their own brands, according to Kathleen Kimple, chief retail officer for Short Hills, N.J.-based FitForCommerce.

“Why wouldn’t you want to make private brands highly visible in your digital experience? These items will be highly visible in-store, and you want to give them the same visibility in your e-commerce store as well,” Kimple said in the report.

About half of the retailer sites visited by the mystery shoppers had banner ads on product listing and search pages, yet only 20% of the ads promoted store brands. Likewise, fewer than 20% of retailers use digital badges or stickers on product listing pages to call attention to private labels. And although private-brand products typically are listed fairly high up on category listing pages, these items don’t appear as high on search results pages, often the springboard for shoppers seeking specific items.

Key search elements also are missing for private brands. Just 44% of food retailers had multiple product images on private-label product detail pages, and less than half (48%) included detailed item description, FitForCommerce’s research found. In addition, 12% featured editorial or other engaging content like recipes. Meanwhile, national-brand product detail pages included more photos, better product descriptions and more engaging content, FitForCommerce said.

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The study, too, revealed a disparity in recommendations. Among food retailers’ product detail pages, 92% had product recommendations for private brands and manufacturer brands. However, for store-brand pages, 72% of the recommendations included other private-brand products whereas less than half of national-brand pages featured recommendations for private-label items.

Kimple emphasized that own brands reflect retailers’ image in the marketplace and, in turn, these brands should be prioritized in key areas of the online customer experience.

“It has to start with the perspective from senior leaders that these are our private brands that we stand for, and we need to align digital and store efforts,” she explained.

FitForCommerce’s findings showed that private-brand visibility could be improved in other online content on grocery retailer websites, including the following:

• 60% of food retail sites have blogs, yet only 20% mention private brands and over 90% don’t include banners spotlighting national- or private-label products.

• 88% sites offer an online recipe section. and about 76% feature private-brand products for ingredients.

• About half of sites include new products sections, but store brands show up only in 36% of those sections.

• 80% of retailer sites had digital weekly circulars, but just 20% include a special section for private-brand products. And of these digital circulars, fewer than 50% promote private-label coupons and a third offered online deals for store brands.

“Customers will be unforgiving if the online experiences let them down. They have expectations about how site search and other aspects will work,” according to Kimple. “It’s important to make the experience as good as possible to drive basket size, conversion and loyalty.”

In 2020, online grocery sales jumped 69% across food and nonfood categories, including both national and private labels, FMI reported in the Power of Private Brands 2021 study. Store-brand growth via e-commerce came in at 73% last year, and private-label sales rose 14%. About two-thirds (67%) of private-brand assortment was available online.