One of the first things that people often think of when going into business is that they need to create something new. After all, creating something new or bringing a new approach to a certain category can help set you apart from the competition and make your brand unique.
This year, budget discounter Aldi have also set themselves apart by doing the opposite in their above-the-line Christmas campaign. Aldi’s 2018 holiday ad features a bright red truck, billowing down a frozen landscape, announcing the start of the Christmas season. Sound familiar? Well it should, because the famous red truck and the snowy hopeful journey has been a staple of Coca-Cola’s holiday advertisements since the 1990’s. Coca-Cola responded with humour to the ad, offering to lend a helping hand and tow the Aldi truck.
However, Aldi’s decision to spoof Coca-Cola’s famous truck is not a new concept, they have been imitating brands for years and they are not alone. Since the early 80’s, shoppers have often seen ‘double’ at the fixture: similar product, similar packaging, and good quality but at a notably lesser price, often 20-30% less – so began the first era of own label copycat brands.
Some of the most successful retailers have been shamelessly riding on leading brands’ coattails by adopting a copycat strategy in multiple categories across the store. Over the years, cashing in on big brands’ success became a rampant phenomenon and has given global brands a run for their money, but at what cost?
65% of shoppers say that packaging is confusing and own label products have certainly muddied the waters. Some shoppers feel cheated and even tricked if they mistakenly purchase a lookalike brand. They question the quality, authenticity and credibility of the copycat product. As a result, own label products have sometimes suffered from ‘the poor relation’ perception syndrome. For every Oreo and Weetabix, there’s an equivalent copycat brand such as Borneo and Bixies.
Yet despite some shopper reluctance, is the copycat strategy working? Yes.
According to Kantar, Aldi increased sales by 15.1% in the latest 12 weeks. This is the fastest rate of growth since January 2018, supported by its fresh and chilled aisles, with sales of dairy products up 24% and fresh poultry up 29% compared with last year. Some 6% of Aldi’s sales came from premium own-label lines including its Specially Selected range – a higher proportion than any other supermarket. Its growing number of stores helped it increase its market share by 0.8 percentage points to 7.6%.
Similarly, its main rival Lidl attracted 5% more shoppers through its doors compared with the same period last year and persuaded visitors to spend an extra 55 pence per trip – a greater increase than any other competitor – helping the store achieve sales growth of 10.0% and a market share of 5.6%.
Small food and beverage brands are creating real ripples in the industry and causing big retailers like Sainsbury’s to not only list them but celebrate them. If they continue succeeding, then they will have to deal with the reality of copycat branding. Especially as Aldi has also recently taken to imitating smaller brands, who unlike Coca-Cola or Nestle may not be able to stand up to the cheaper Aldi range.
3 Ways to Safeguard your Brand from Copycat Branding:
Be explicit with your brand’s role in the category and how it will lead, disrupt, or drive long-term growth and shopper loyalty.
Communicate to shoppers why they should pay more for your brand vs. the own label version. The USP and credentials: provenance, ingredients, sourcing.
Reduce the possibility of imitation through: range of pack sizes, formats, variants.
They say, ‘imitation is the sincerest form of flattery’, but the real question at play is will shoppers choose your brand in a split second or will they be swayed by the next best thing?
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