Indonesians consider 'private label' as good as big brands
Indonesians consider 'private label' as good as big brands
The Jakarta Post, Jakarta
As basic needs prices go up, Erwina Susanti has started to buy
groceries based on price, rather than brand, selecting those
products whose quality matches well-known brands.
Cheaper products are now being offered by supermarkets and
hypermarkets through their own brands, called private label, as
an alternative for consumers.
"I'm a regular buyer of private label products," said the 40-
year-old housewife. "They are cheaper. By buying those products,
I significantly reduce my monthly spending."
University lecturer Ista started to use private label products
10 years ago. However, she acknowledged that not all private
label products were worth purchasing.
"I do buy private label for sugar, tissues and cooking oil.
But for personal hygiene products, like shampoo and toothpaste, I
still prefer famous brands," she said.
Both Erwina and Ista represent 62 percent of Indonesians who
agree that private labels are an alternative to big brands,
according to a global survey by marketing research firm
ACNielsen.
The survey, the Global Private Label Consumer Study, was
conducted simultaneously worldwide from April 11 to May 10. The
survey asked 510 Indonesian respondents -- out of about 21,000
respondents in 38 countries -- their perception of private label.
The survey found that 66 percent of Indonesian consumers
consider private label to be worth the money, considering they
are of a similar quality to those of big brands. Some 56 percent
said private label products had good packaging.
However, only 15 percent consumers said they bought all
categories of private label products.
"Consumers may be happy with the quality of private label when
it comes to dog food, towels, sugar and flour, but are less
convinced if they're considering, say shampoo, baby food or their
favorite pasta sauce," said Yongky Surya Susilo, ACNielsen
Indonesia retailer and business development director, in a
statement made available to The Jakarta Post.
The majority of consumers agreed that private label products
were aimed at people on a tight budget, while only 13 percent
thought the other way around, the survey said.
It also found that a high percentage of customers are familiar
with private label and only 27 percent were not aware of it.
"The awareness and acceptance of private label in Asia and
other developing markets will in part go hand in hand with the
growth of modern trade in these countries," said Farquhar
Stirling, Managing Director of ACNielsen for Southeast Asia,
referring to the growing habit of Indonesians and other Asians to
shop at supermarkets and hypermarkets.
ACNielsen data shows that at present, 50 categories of private
label products are sold across the nation.
Yongki said the domestic market for private label products
would continue growing if retailers promoted their products more
often.
"Part of this (the lack of awareness of consumers) could be
attributed to the lack of awareness of retailers' brands in
developing markets. In Malaysia and Taiwan, for example, nearly
half of respondents said they did not know enough about private
label products and wanted to try them," he said.
"Our survey showed the longer consumers are exposed to private
label, they have a better opinion about them," he added. (006)