As part of ESM's annual Private Label Issue, we spoke to Lidl Denmark's chief commercial officer Rasmus Pape, who said that innovation and embracing new categories are key to driving future private label growth. This article first appeared in ESM Issue 1 2021.
The discount channel dominates the market in Denmark, and has been bolstered by the pandemic – according to the most recent data from Statista, discounter turnover totalled DKK 9.4 billion (€1.26 billion) in the third quarter of last year.
As a major player in this category, Lidl Denmark has sought to raise the bar when it comes to private-label innovation, through partnerships with Michelin-starred chef Wassim Hallal, as well as a range of premium local producers. Its efforts haven’t gone unnoticed, with Lidl Denmark winning at least one category in successive European Private Label Awards.
According to Lidl Denmark’s chief commercial officer, Rasmus Pape, the COVID-19 crisis has helped to bolster the retailer’s reputation for quality private label in the eyes of its consumers.
“It is usually assumed that consumers look to well-known brands for more transparency during a health crisis,” he says. “However, we have not seen this to be the case, as a combination of a secure brand strategy with a focus on informing the consumer about the products’ properties and value in private labels, together with a strong focus on CSR, has increased customer loyalty.”
Exceed Expectations
According to Pape, Lidl Denmark seeks to exceed the expectations that consumers might have about the private-label segment, with new product innovations last year including a range of slowly-bred chickens, which put “animal welfare even more in focus”. A new Mate Tea SKU, the WH range of organic sorbets (a winner at the European Private Label Awards), and an “inspiring” specialty beer range were other highlights.
“Our concept as a retail chain has private label as its primary business area, which is why a constant proactive focus on seeking out the right trends and developing the right products is crucial for creating customer loyalty,” he says. “This is thus crucial to our overall brand strategy, as a chain.”
Lidl Denmark recently introduced the rollout of a new store concept, with which the retailer is seeking to enhance the focus on its private-label offering, Pape adds.
“We are presenting even more products in our updated store framework,” he says. “The products are better expressed in settings that demonstrate quality and modern appeal, so they match the products to an even greater degree.”
Organic And Local
In terms of future product development, Pape says that Lidl Denmark “continues to see great opportunities within our organic assortment”, as well as for vegan and vegetarian products, products with health benefits, and products with a defined local origin.
“It is very important that we, together with local producers, can build cooperation and expand nationally, but also internationally,” Pape says of the group’s commitment to Danish producers.
“Despite the fact that Lidl is an international company, we are locally rooted in the individual market and make a virtue out of supporting local jobs and growth locally. This harmonises really well with our values.”
© 2021 European Supermarket Magazine – your source for the latest Private Label news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: The European Supermarket Magazine.
