The Sainsbury’s/Asda merger: a new direction for own brand strategy?

With news of the Sainsbury’s and Asda merger, we were wondering how it could affect their own brand strategy.

We have worked with both of these supermarkets on their own brand packaging in the past (as well as Tesco, Waitrose, M&S and others) and while the look of the packaging changes, the strategy is still fairly similar. Currently, Asda and Sainsbury’s own brands are very corporate treating them as cheaper alternatives to the bigger brands.

Could the merger be the opportunity for something different?

Aldi and Lidl’s own brand packaging relegates the stores brand name to the back label. Each pack has a look and feel that looks like it belongs to the sector. While they often mimic brands intellectual property (often too closely in our opinion), they look like believable, credible products. The beer and wine section works particularly well.

What if Sainsbury’s and Asda created more brands that they owned, like George and Tu, in other sectors such as food. They could happily co-exist in both stores bringing savings in packaging in quantities of scale. These ‘owned brands’ would emotively feel like they were credible, confident alternatives to the brands they sat alongside or new innovative ranges like Tesco’s ‘Waste Not‘ (without stealing anyone’s intellectual property of course). This could give them the opportunity to sell these unique brands elsewhere, such as Amazon or Ocado.

Transparency will be key as usual, making up farms that don’t exist, selling horse meat instead of beef or faking provenance will be a big mistake.

What if Asda and Sainsbury’s took the opportunity to position themselves as the incubators for innovative, sustainable products. The combined power of both brands gives them the opportunity to lead in newsworthy areas, such as finding more sustainable packaging and use of plastics.

What a challenge. What if…