Ability of retailers to innovate likely to drive future growth of private labels

The main USP of private labels is their customisation according to user demands. They are then promoted by various means including innovative packaging, promotional schemes, and placement within the retail store. Therefore, success of private label retailers globally has been dependent on their ability to innovate in all aspects of a product - formulation or ingredients, supply chain, packaging, advertising, promotional schemes, and so on. The dynamism of private label retailers, in responding to changing consumer needs through suitable modifications, is also critical. In light of the intense competition in Indian retail, coupled with the choosy Indian customer, future success of private labels would depend on the ability of Indian retailers to innovate. This is again a question mark, given the reputation of Indian companies as poor innovators.


Time will tell

No one can deny that the Indian retail industry is one of the most attractive globally. It is still at a nascent stage, and holds a lot of promise for the future. It is also certain that private labels will continue to increase their share in Indian retail, and are expected to play a key role in every Indian retailer's future strategy. However, under the prevailing circumstances, private labels are unlikely to take off in a big way in the near future.

soumitrasharma555@yahoo.co.in

References:

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