Consider Costco’s popular private label, Kirkland Signature
Kirkland Signature, Costco’s private label brand, generates as much, if not more, revenue than some of the world’s largest brands. This popular brand designs products to be of equal or better quality than national brands, and consumers see that. The brand’s sale penetration garners more than a quarter of the retailer’s total merchandise sales. As a rule, Costco mandates that private label products comprise 25-30 percent of their category merchandising, and has built up brand equity with the Kirkland brand for years.
However, with a robust marketing plan and understanding of private labels in your competitive landscape, your brand can adequately compete with Kirkland Signature, or any other products in your aisle. Stay close to first-party data to ensure your products are positioned to consumers who are most likely to buy, protecting your market share. Additionally, offer Costco as a checkout option directly from your brand’s shopping experiences, whether it be on your media or your brand website, to seamlessly add your products shopper’s Costco carts, and shorten the overall path to purchase.
Here are some best practices when it comes to competing with private label from our partners at Profitero:
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Brands must embrace their role as category advisors and help retail partners develop a private label strategy that balances profit, growth, and consumer choice. Sales leaders shouldn’t shy away from discussing private label search in JBPs and retail media negotiations, ensuring their brands get a ‘fair share’ of organic placement as a reasonable ask in return for media and trade commitments.
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Private label may win on price, but national brands have the advantage when it comes to developing differentiated content and innovations because they deeply understand the consumer.
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Competing with private labels on price rarely leads to sustainable growth, as dynamic pricing algorithms track every price change, driving a race to the bottom and lowering average selling price (ASP). However, monitoring pricing and promotion dynamics helps brands benchmark against competitors, including private labels, and better understand shopper decisions from a full category perspective.
Read more from our partners at Profitero in their report, Fighting Back Against Private Label Online
Leverage eCommerce enablement and analytics
Enable shoppable media with a partner like MikMak. Make the path to purchase for Costco short and seamless for your consumers. Remember, every step outside of the intended path to purchase opens up opportunities for your competitors to intervene. Using MikMak Insights helps you manage multichannel marketing strategies and gain actionable data.
Utilize a marketing software and tools, including MikMak’s Custom Report Builder. By doing this, brands can ensure a consistent presence across channel, access real-time marketing data, and use data analytics marketing to improve omnichannel strategy and sales performance.
Get close to the data by utilizing platforms like MikMak for comprehensive eCommerce enablement and analytics to seamlessly manage multichannel retail strategies and gain actionable insights. By gathering and leveraging first-party data, brands can enhance marketing effectiveness, personalize the shopping experience, and ultimately drive profitability.
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MikMak Insights Custom Report Builder
Improve marketing effectiveness by building custom reports with all of the desired metrics, dimensions, and filters you want, directly in the MikMak Insights platform.
Strengthen your relationship with Costco
Keep a close eye on which products perform best at Costco, and direct traffic accordingly to encourage higher conversion rates. Consider using tools like MikMak Custom Retailer Allocation to achieve this. Additionally, you can enable MikMak’s where to buy product locator feature, MikMak Store Locator, so shoppers can see when your products are in-stock at their local Costco. You can also use proprietary, retailer-specific consumer insights from MikMak in joint planning discussions with Costco to unlock shelf space and media value.
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MikMak Custom Retailer Allocation
Apply percent allocations for how frequently retailers will appear in Retail Media experiences to drive higher conversion with intelligent, performance-based retailer redirection capabilities
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MikMak Store Locator
Global store locator that helps shoppers find local retail options where your products are available, directly from your website or media.
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Costco has a new, data-robust retail media network
Costco’s new retail media platform offers eCommerce brands access to first-party data, allowing for personalized ads targeting its 74.5 million household members based on shopping behavior. While still in development, Costco's ad network has the potential to rival major players like Walmart and Target. By integrating MikMak’s retail media solutions, data, and insights alongside Costco’s robust membership data, brands can enhance their strategies to drive both eCommerce and in-store sales.
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MikMak for Retail Media
Optimize for retail media. Bypass the landing page and lead shoppers straight from your ad to the retailer PDP of your choosing, reducing the number of clicks a shopper makes, while still collecting all the same data and insights expected from MikMak.
MikMak Commerce for Retail Media provides consistent and real-time reporting of retailer-specific performance data alongside national media investments including paid search, influencer media, display, video and more; empowering brands with the information needed to properly adjust and scale their retail media strategy.
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Implement scalable tools and platforms for global efficiency
Save time and money companywide. One easy-to-use global platform like MikMak, complete with full-service and self-service tools, automatically enables consistent reporting and fast decision-making across the entire organization. Our platform empowers you to build, design, and customize eCommerce websites and media experiences, all backed by our best-in-class global retail network, inventory data, and sales attribution.
Headless Commerce API
MikMak’s Headless Commerce API is now completely configurable through our Platform’s Self-Service Tools helping you save time when deploying customized commerce experiences powered on the backend by MikMak
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"As we engaged with MikMak, the benefit wasn’t just the solution, but the ability to connect the data and say, ‘If I’m improving the consumer experience and our ability to convert and send qualified traffic to retailers, I’m creating a new value opportunity for our business that the sales team, retail partners, and brand teams will want to hear.’"
Justin Thomas
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