Speaking during a panel discussion at the IGD’s 2013 Convention in London, Spar UK md Debbie Robinson told delegates: “We are seeing increasing consolidation.” She said many brands were “just becoming commodities that are traded for a share price”.
“I respect brands that do manage to hold on to the integrity they have and if they do that they can span generations.”
It was hard for big brands to hold on to consistent values in the current tough economic climate and family-owned brands more steeped in traditional values had an advantage there, Robinson said. “If you lose that, you run the risk of brand equity being lost through change of ownership.”
Stephen Smith, chief marketing officer at Asda, agreed with her comments. “Brands need a story behind them. Just being big is not going to be enough.
“If a brand gets passed from one owner to the last, then it’s going to be one of those brands that will show up on your list that’s perhaps delisted at some moment in time.”
Space for more innovation
However, there were positive sides to the food industry facing increasing consolidation, said Smith, as it created space for more innovation as brands were launched to replace those that had been devalued. “Expect to see a greater proportion of newer, smaller brands.”
Robinson and Smith were commenting on the response to a live electronic poll of the audience conducted at the IGD annual convention.
Delegates were asked: “What does the future hold for brands?” A total of 64%, almost two thirds, said that they expected there to be a fall-out, but new brands would fill the gap.