Retailers’ focus on in-house developed private labels has been on the upswing of late, creating more competition for manufacturers and property owners seeking shelf space for their licensed products. These recent examples illustrate the trend:
- Target introduced three new private labels this summer. They include Heyday for electronics, which debuted in June; Wild Fable for trendy mix-and-match apparel, accessories, and footwear for young women, in August; and Original Use for streetwear-inspired apparel for young men, also in August. In addition, the retailer will phase out its 15-year-old exclusive license for activewear, C9 by Champion, when that deal expires in January 2020, with plans to introduce other performance-based private labels. (Last year, Target launched its exclusive JoyLab activewear line, co-designed with Who What Wear, an online fashion and style destination that has an apparel direct-to-retail deal in place with Target.) All of this proprietary activity is part of its ongoing process, begun last year, of introducing 12 private labels over an 18-month period.
- Grocery giant Kroger, which generates $20 billion annually from its store brands in various food categories, according to published reports, launched a private-label apparel line, Dip, in conjunction with clothing designer Joe Mimram. The new assortment will debut in the 300 Kroger Marketplace and Fred Meyer bricks-and-mortar stores across the country (but not online) this fall.
- British department store John Lewis, which has a large number of private labels in place already, debuted John Lewis & Partners this summer as its biggest own-brand program yet. The range includes 800 SKUs of womenswear, accessories, and footwear. Company executives told the publication Draper that the retailer’s goal was to ultimately generate 50% of its fashion sales from private labels.
- Amazon recently added two home goods private labels, Stone & Beam and Rivet, with the former encompassing country-chic furniture and the latter mid-century-style pieces. All told, Amazon’s roster of private labels in the U.S. has quickly grown to 74, extending across multiple categories, with apparel, home goods, and electronics being the top three areas of activity to date.
Historically, retailers’ focus on in-house-developed private labels has tended to be cyclical, as they rotate over time between emphasizing manufacturer-branded goods, preferring exclusive licensed lines, and stressing proprietary brands, depending on the economic landscape, consumer desires, strategic goals, or other factors. While direct-to-retail licensing deals are still possible these days—and both Dip and JoyLab were created in conjunction with outside partners—their incidence has declined in the face of the current wave of newly created, in-house-driven private-label brands.