The chief financial officer of FMCG giant Procter & Gamble, Jon Moeller, has said that be believes the company has the tools necessary to compete strongly in the categories in which it competes with private label brands.
Speaking at the Deutsche Bank dbAccess Global Consumer Conference, Moeller said, "Private label brands have always played a role in our categories, and we anticipate will continue to do so," adding that P&G is focused on delivering "consumer-preferred innovation" in order to offset store brand growth in categories such as Baby Care and Family Care.
Baby Care Challenges
In Baby Care specifically, Moeller said that lower private label pricing "down almost 20% in some retailers" has been challenging for some brands in its portfolio, such as disposable diaper brand Luvs.
"While we’ve taken some steps to restore Luvs’ competitiveness, it hasn’t yet had the desired effect," he said. "We’re taking more action including marketing in-store presence and where needed value adjustments.
"In Europe, where private label is most developed, there has not been a material change and share growth over the last few years. Europe private label share has been flat over the past three years and continues to be flat this year. [...] We know how to win."
Raising The Bar
Later, Moeller said that P&G continues to set the bar high in a "retail landscape [which] is transforming itself".
In terms of how the branded vs private label battle fits into this dynamic, Moeller said, "We simply can't operate the way we historically have in terms of being a little bit better. We need to be a lot better.
"I think it's an achievable standard, but it's a difficult standard and a constantly moving standard, because our competitors are good and strong and don't stand still either, be they branded manufacturers or our retail partners."
He added that both value and volume share trends "continue to improve" across the P&G portfolio, with volume shares in line with prior year levels.
"Eight out of 10 global categories are holding or growing volume share," he said.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Karen Henderson. Click subscribe to sign up to ESM: European Supermarket Magazine.
