As part of ESM's annual Private Label Issue, we spoke to Ana Amaral, private-label director at Sonae MC, operators of the Continente chain, about how the group is using a variety of sub-brands to tap into emerging niches. This article first appeared in ESM Issue 1 2021.
Portuguese retailer Continente, part of the Sonae MC retail group, has responded proactively to the challenges of the past year. As well as accelerating its online presence – online sales have grown by 80% over the past year – the group achieved the highest market share increase in its history, along with significant improvements in customer preference scores and brand metrics.
One of the driving forces behind the retailer’s growth has been its broadened private-label range, which has seen both new-product launches and packaging reformatting over the past few months, in response to consumer demand. As private-label director Ana Amaral explains, store brands have flourished during the pandemic, as consumers seek out products that offer both trusted quality and value for money.
“Private label has seen an increase in penetration because consumers recognised the value proposition – based on price, quality and variety – long before the pandemic started,” Amaral says. “The perception of private-label versus branded products has been shifting positively towards private label because retailers have placed it at the centre of their strategy.”
Product Innovation
Since the start of the pandemic, Continente has focused its new-product development on both structural and strategic launches, as well as tactical, context-driven launches, says Amaral. Two of its biggest launches last year were Continente Equilíbrio and Continente ECO, with the group following this up with the roll-out of Continente do Bebé earlier this year.
“These sub-brands are examples of projects that were planned, thought out, and are strategic to the brand and the insignia,” says Amaral, “but then the context changed, and we realised that consumers had new needs that we also had to address. People were working more from home, and the need for deep-cleaning and disinfection solutions arose very suddenly.
“With that in mind, we developed Continente Protect – a disinfectant, household-cleaning and hygiene range – within three months. This time to market was only possible because the whole team at Sonae, along with our supplier, were so committed to these products. We realised that this kind of product was only available at a premium price, so we made it much more affordable.”
Another innovation that was developed in response to the changed circumstances were the Savings Pack products: large-format items offering lower prices per portion. “Being on the brink of economic uncertainty made us address the price issue strongly,” says Amaral. “We took consumers’ favourite products, developed bigger formats, and offered savings, to help consumers save money. We now have over 50 articles in this line.”
Sustainability Matters
The pandemic has also heightened demand for more sustainable products. Along with the high-profile launch of Continente ECO – “We wanted to develop sustainable household-cleaning products that deliver on performance and are affordable,” says Amaral – Continente has ramped up its efforts to promote the responsible use of plastics. In 2020, it confirmed its commitment to the Ellen MacArthur Foundation’s New Plastics Economy Global Commitment – the first Portuguese company to sign up to this initiative.
“One year on, Sonae MC has one of the best results in the world among the signatories,” says Amaral. On a national level, the retailer boasts the highest percentage of packaging that is reusable, recyclable or compostable – 55%.
“As market leaders, we play a key role in promoting the responsible use of plastic, thus influencing the entire value chain,” Amaral adds. “Our purpose is to create economic and social value in the long run and help to change consumer habits.”
© 2021 European Supermarket Magazine. Article by Stephen Wynne-Jones. For more Private Label news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.
