1. Take higher margins in less price-sensitive categories
Ranking categories based on purchase frequency is a fast and inexpensive way of identifying categories that are least sensitive to higher pricing.  Shoppers are less likely to remember pricing on products purchased only once or twice per year. For higher-priced products, however, shoppers are more likely to shop around for the best deal.

2. Lower the thermostat in stores this winter
Your customers will be wearing coats anyway.  This will save on heating costs while promoting a “green” image.  Retailers can post a sign on the front door, letting shoppers know how lowering the heat helps the environment.  Also consider turning down the air conditioning in the summertime.

3. Publish your own $100/week family menu
Supermarkets can create a weekly meal plan for a family of four to eat nutritious meals from easy recipes tied to key items. Look to your vendors for meal ideas or consider ways to promote your own store brands. Consider showing price comparisons to fast food restaurants.

4. Tie discounts to large or frequent trips
Why offer red-hot door-buster deals that do nothing to generate additional purchases?  Instead, consider offering hot prices for shoppers with a $100 purchase.  Supermarkets may consider a special deal for shoppers with $500 in receipts over the course of a month.

5. Expand beyond your channel’s traditional product mix
What’s stopping grocers from selling video games or electronics stores from selling snacks?  Convenience and liquor stores also have a huge opportunity to sell products appealing to men, like tools, gadgets, and video games. What’s more, grocers can take higher margins on “non-grocery” items, since shoppers buying electronics or clothes in supermarkets are looking for convenience and fewer trips — not always the lowest price.

6. Maintain competitive pricing in most frequently-shopped categories
Shoppers can recognize a high price on the products they buy weekly, whether it’s milk, bread, soda, or diapers.  To give the appearance of low prices, retailers need to keep these items priced competitively, even if those low prices are subsidized by less price-sensitive items.

7. Disguise store brands
Consumers can usually spot store brands positioned as a low-cost alternative to a national brand.  But in the past few years, savvy retailers are developing premium, multi-tiered store brands. Some retailers, like Walmart, downplay their store brands with different brand names for each department or category.

8. Support organic, natural and green products regardless of sales
The growth of organic products may slow during this economic downturn, but featuring healthy and environmentally sustainable products will help to boost a retailer’s banner equity.  Organic, natural, and green products project a positive image for retailers — and when the economy recovers, retailers will want to be known for more than just low prices.

9. Get shoppers to try premium private label products
No one will know if your private label salad dressing is as good as the national brands if they don’t try it.  Shoppers are creatures of habit, and changing habits takes some effort.  Offer trial sizes, $1-sizes, or 100-calorie packs.  Or, consider featuring one private label product each week with a free unit to shoppers spending $100.  Shopper taste comparison demonstrations in the store may also help to boost private label products.

10. Make a good impression on new shoppers
The struggling U.S. economy is significantly affecting how and where people shop, with consumers switching between both brands and retailers.  Now is not the time to cut corners on factors that will negatively impact shoppers’ experience.  Don’t let the checkout lines get too long, remove the used tissues and flyers from the bottoms of carts, keep the conveyor belt clean, and treat every shopper like it’s their first visit to your store.

Read more about how to cope during difficult economic times in “Consumer Insight.”

View the January 2009 issue of “Consumer Insight.”

Private label dollar sales are being driven primarily by higher commodity pricing — especially in staple categories that are dominated by private brands. But in recent weeks, private label unit sales have also grown — a sign that consumers are starting to shift away from established brands in search of better deals.

Among private label food brands, flour (+35%), baby food (+33%), and fresh eggs (+28.2%) showed the largest dollar percent change during the 52 weeks ending September 6, compared with the prior 52-week period.  Unit sales for those products remained flat during the same period: flour was up 7.2%, fresh eggs dropped 0.9%, and pasta grew by 0.6%.

Among non-food private label products, soaps and bath products (+23%), cough and cold remedies (+18%), and hair care products (+18%) showed the largest dollar sales growth during the period.  Paper products, like paper plates, paper towels, and toilet tissue, and aluminum foil were the top-selling non-food private label items. 

Across categories, health and wellness-oriented private brands also showed significant growth, according to Nielsen.  Products claiming to be “natural” (+11.4%) or “organic” (+22.5%), lacking in trans fat or saturated fat (+30.5%), or containing “multi-grains” (+16.6%) or “antioxidants” (+15.8%) showed the largest dollar sales growth during the period.  Products that claimed to contain no calories (-0.6%) or to be caffeine free (-2.2%) showed the only negative growth. 

Among organic private label items, milk, eggs, and produce – like mini carrots and salad mixes — were the top-selling items.

View in depth private label sales data from Nielsen.

Learn more about private label sales in convenience stores.

Read more about overall private label trends in Nielsen’s “Consumer Insight” newsletter.