In a depressed economic context punctuated by sanitary crises, an increasing number of consumers, are turning to safer, closer and more civic forms of food consumption (e.g. support for the local economy and for the protection of the environment). Thus, they patron short circuits or sometimes… supermarkets, which have long understood how they could benefit from a positioning anchored in their immediate surroundings.
The « terroir private label » has a genuine territorial legitimacy
Designed as a lever for differentiation, most French supermarkets have developed their terroir private label: Carrefour with “Reflets de France” (Reflections of France), Leclerc with “Nos regions ont du talent” (Our regions have talent), Système U with “U Saveurs” (U Savors), Lidl with “Saveurs de nos regions” (Taste of our regions), and Casino with “ça vient d’ici” (It comes from here). These labels often show good economic performance and indisputable benefits in terms of image. In an article published in Décisions Marketing in 2012, René Pierre Beylier, Karim Messghem and Fatiha Fort showed that “Reflets de France” is perceived as a real brand of terroir which reinforces the territorial legitimacy of Carrefour, brand seen as an actor attached to its territory and helping the socio-economic development of the regions.
How can this be combined with a good image on price?
This is all great, but in a fierce competitive environment (i.e. of private labels among themselves and with national brands), particularly on prices, how can we be responsible and legitimate while remaining attractive in terms of price in supermarkets? This is the question Jérôme Lacœuilhe, Louis Didier and Cindy Lombart seek to answer, in an article from Recherche et Applications en Marketing.
The authors carried out a quantitative research among 287 consumers of the “U-Saveurs” brand. They show that the private label of terroir contributes to developing a responsible and legitimate business image, without degrading the perceived affordability of its stores. Specifically, they underline that consumers in favor of terroir private labels assess the brand as having a better CSR (Corporate Social Responsibility) image; and this, regardless of the store format (hypermarket, supermarket and proximity). Thus, terroir private label, through a quality-price ratio deemed satisfactory by consumers, contributes to the development of a positive price image and a favorable CSR image. It is also a factor of legitimizing the brand in its territorial anchoring. This anchoring was evaluated on two metrics: the links forged with the territory and the territorial rooting (i.e. the duration of presence in the territory).
For a good use of the Terroir Private Label
By developing a terroir private label offer, the supermarket brand can develop an image of proximity and territorial responsibility with its customers. It highlights the intensity of the links forged with the various actors of the territory, in particular the SMEs; but it also emphasizes their attachment to the territory where they are located. This is obvious through the packaging of their products, by mentioning the way in which terroir private labels are made, their origin and their composition. It is in the interest of the brand to communicate in stores about this type of offer (POS, point-of-sale events, etc.). This would have the effect of making hypermarket and supermarket formats more legitimate, which for many years have seen their market shares stagnate or decline. Beyond that, the brand can apply this image of responsibility in its various communication actions (marketing or corporate).
Can all brands take advantage of terroir private labels in the same way to improve their image of responsibility, territorial legitimacy and their price image? Is this question still relevant when the brand is positioned on low prices and has a fairly average image?
Lacœuilhe, J., Louis, D., & Lombart, C. (2018). Contribution of terroir store brands to retailers’ legitimacy and CSR and price images. Recherche et Applications en Marketing (English Edition), 33(4), 74-91.
Blog post adapted from Agnes Helme-Guizon’s (in French) by Fabien Pecot.