We have noticed that Shoppers Drug Mart has been making a push for its customers to “Rediscover Life Brand” across the whole store since the beginning of 2014.
The campaign includes in-store signage, new product packaging, flyer space and staff t-shirts promoting the new look and feel of Life Brand which is more contemporary while holding on to its long standing brand heritage.
While brands re-stages like this take a long time and was likely in motion before SDM was acquired by Loblaw, we see this as a strong signal that Life Brand will become the dominant Health & Beauty private label for the combined business and will replace Exact in the grocery channel.
We have been critical of SDMs fragmented PL strategy, especially in food. We see President’s Choice replacing Life, Simply Food and Nativa in SDM Pantry sections and most likely a roll-out of Joe Fresh baby clothing in larger stores as the merger comes together operationally.
Private Label penetration growth, consolidation of purchasing and supply chain efficiencies will be long term profit enhancers for the new combined business and a further challenge to national brands in terms of shelf space and market share.