Monday, 25 August 2008

European retail brands: how relevant is their experience for Africa?

Today's Business Daily carries an article, "Rise of retail brands is based on a holistic set of strategies", by Richard Mukoma (Chief Executive, Interbrand Sampson East Africa). This feature explains in fairly basic terms what a retail brand is, listing Uchumi, Nakumatt, Ukwala and Tuskys -- all supermarket brands -- as leading retail brands in Kenya.

The author asks: "So how do retail brands create their value and what lessons can we learn from the leaders?", answering this question by reference to Interbrand's own research in Europe. The findings indicated that almost two-thirds of the top-performing European retail brands offered private-label products, with three of the top five brands selling only private-label products.

The question that this article does not answer is how far the experience of the leading European retail brands can be made relevant to the development of retail brands in Africa. The big retailers in Europe had the advantage of being able to leverage their relationship with consumers on the back of the huge advertising spend of the independent brands they originally sold, in a market in which private -label brands could flank the independent products by offering no-frills low-priced products as well as high-priced premium products. How well would this work in Kenya? Readers' comments are welcomed.

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