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Marketing Matters: Private Label Grows Up

By: Donna C. Barson
Posted: February 11, 2008, from the February 2008 issue of GCI Magazine.

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If you need somebody to blame for this private label change from frumpy to fabulous, look no further than Martha Stewart. Stewart’s partnership with K-Mart some years ago suddenly gave private labels polish and pizzazz, and now Macy’s also carries her products. No longer was the private label some anonymous product made by some anonymous manufacturer, but now it carried the distinctive and well-known name of Stewart.

Soon Michael Graves was in Target, drugstores were seeking out their own exclusive brands, and private labels were on a rising sales escalator that hasn’t reached the top yet.

Macy’s, in fact, is becoming a retailer composed of mostly exclusive/private label brands, nudging out national brands that have been with the chain for decades.

In personal care, CVS has exclusively introduced Lumene personal care lines from Finland, and this, along with Essence of Beauty, Dr. Jeffrey Dover and other exclusive private brands, including new free standing skin care centers with private label and exclusive brands, have turned CVS into a beauty destination.

Personal care lines from Boots the Chemist, found only at Target and CVS, are bringing in customers and making these stores destinations. Walgreens is now the exclusive U.S. retailer of several European beauty brands.