November 6, 2003
About half of Israelis (47%) believe the quality of the supermarket chains' in-house labels is as good as competing brands - 14 percent even believe in-house brands are better quality, according to a survey Market Watch conducted for Haaretz in October.
Market Watch CEO Avinoam Brog said the results surprised him. "Consumers think the in-house brand is better despite the massive sums the big companies invest in making their products distinctive and of better quality."
Brog said quality is only one consideration in making a purchase - the other is price, and in that area the in-house brands also have the advantage of being an average of 15 percent cheaper than similar products.
Even so, said Brog, another important consideration is related to image and status and here the in-house brands have a problem. "Anyone buying an in-house product is regarded as someone who buys cheap, and even though Israeli society considers it more legitimate than in the past to shop on economic considerations, there is still the matter of the influence the brand purchased has on the buyer's status."
The survey found that SuperPharm's in-house brand, Life, is the leading brand for consumer awareness - 59 percent of those polled recognized it. Supersol's in-house brand, Super Class, took second place, with 48 percent consumer recognition.
Consumers are less aware of Blue Square's in-house brand, Leader Price (26 percent had heard of it) and only 19 percent had heard of Clubmarket's Premiere Club. 500 Hebrew-speaking adults over the age of 18 from among the Jewish population were interviewed for the survey, which has a maximum standard deviation of 4.3 percent.
To a great extent the survey's results reflect the ages of the brands. The most recognized brand, Life, is also the oldset and was introduced to store shelves eight years ago. Super Class is a bit younger and was launched in 1998. Leader Price was introduced in 2001 and Premiere Club, the weakest brand in consumer awareness, was launched in February 2003.
Brog does not belive however, that Life's success stems only from its age advantage. He said Life is the only in-house brand whose marketers view it as a brand in every sense of the word and who dedicate resources to advertising it.
Sources at SuperPharm warmly accept this distinction. Marketing vice president Yair Asael says the chain invested 4 percent of Life's sales revenues in marketing the brand in 2003. "Life is a brand in every way, in its quality, its components and its image," he says, adding that an in-store survey found that Life products are considered part of the shopping experience at the chain.