It’s yet another move to address consumers’ demands for lower food prices. Loblaw’s has announced it will test market a new supermarket chain banner: ‘No Name’. That’s the brand the company already uses for its discount products…
Loblaw’s promoted its No Name brand so intensively that it even launched a line of
merchandise including this sweatshirt, illustrating their labelling philosophy….
Over the decades Loblaw’s customers have come to know instinctively that the chain’s ‘No Name’ products are the house discount brand. They’re the opposite of Loblaw’s premium ‘President’s Choice’ brand.
Elevating the brand
Now, Loblaw’s is promoting No Name from a brand name to the banner of a new chain of discount food stores featuring both of its most prominent house brands.
“Our goal is simple – providing food and essential household items across a limited range of national brands and no name brand products at our lowest possible price,” Loblaw’s President and CEO Per Bank said in the official announcement.
“Since food inflation took off globally, we have been laser-focused on doing what we can to keep prices lower for customers, including opening more discount food locations in more parts of the country. This new test concept allows us to pass on lower prices to our customers – it’s a completely different and simplified shopping experience.”
Everything old is new again
The new stores will not be ‘new’ as such. Loblaw’s will be repurposing decor and fixtures at existing locations, repurposing them. But that will support the exercise by saving cash to implement the changeover.
The chain explains, prices will be ‘up to’ 20 percent lower than those for comparable products (both discount and premium) at ‘nearby’ competing discount stores. Shelf prices of approximately two thirds of the inventory will be under $5.
“They’ve sort of taken every nickel and dime out of the cost of the operation, which allows them to sell cheaper every day and still make money,” Retail analyst Bruce Winder told Global News.
If you build it…
… Will they come?
“I think the people who are living at the margin they’re targeting are probably used to […] store hopping to get what they need,” Winder said. And there are plenty of them.
A Statistics Canada report last month revealed that, in a poll taken late April to early June, “nearly half (45 percent) of Canadians reported that rising prices were greatly affecting their ability to meet day-to-day expenses, 12 percentage points higher than what it was two years earlier (33 percent).”
A new Polaris survey for Food Banks Canada reported last week that, “35 percent of Canadians feel worse off financially than they did three months ago.”
Those who reported themselves worse off included:
- 47 percent of all those with incomes below $50,000 a year
- 43 percent or people who identify as visible minorities. And…
- 42 percent of Millennials
My take
I think the time is right for s new true discount store chain in the Canadian supermarket sector. It’s clear that there’s an unmet demand for cheaper food.
I have to admit I’m skeptical of Loblaw’s motives behind launching the new No Name chain. Simply segregating and spotlighting existing discount brands, rather than actually lowering prices, has a ring of cynicism to it. Sure, Loblaw’s has every right to minimize the costs of the changeover. And the No Name identity will definitely draw shoppers, at least for a look-see. All good, for Loblaw’s…
But I’m afraid I have to flag the company for what looks like a shameless effort to do nothing under the guise of ‘addressing consumer demands’.
Of note: “Loblaw’s idea for No Name [stores] comes from before [recently appointed CEO] Per Bank joined the company,” Global Bews reports, ” having tested out a smaller, simplified store at Salling Group, with a hard discount banner called Basalt, in Denmark in 2002. It shut down seven months later.”
But this is 2024. Maybe the idea’s time has come. We’ll see how it all pans out.
~ Maggie J.