Sainsbury’s in own-label rethink

Sainsbury’s is to begin promoting secondary brands such as Radion, Daz and Surf and reverse its policy of building own-label, according to one of the City’s top retail analysts.

NatWest Securities analyst Tony MacNeary says the chain’s 55 per cent own-label penetration has prompted consumers to shop elsewhere for a wider choice of big brands.

Over the past year, Sainsbury’s has spent 7m on advertising and promotions for clothes detergent Novon, but has done little to push other brands in the detergent sector.

The supermarket giant is testing “new low prices” on branded goods, shifting pro-motional spending away from own-label.

According to MacNeary, the chain will try to win back customers by offering a wider choice, and give more shelf space to secondary brands which have lost shelf space to own-labels.

MacNeary adds this policy could be reversed in favour of resurrecting secondary brands such as Daz, Radion and Surf, which were almost eliminated in favour of sub-brand Novon and market leaders Ariel and Persil.

A spokeswoman for Sainsbury’s says it is highly unlikely that the chain will abandon its own-label products.

“We have 17,000 product lines, half of which are own-brand. The own-brand products have always performed very strongly and there is no reason to start doubting them now,”

she adds.