Power in exclusive national brands

Earlier this year, I addressed whether brands are still relevant in today’s aftermarket. The Reader’s Digest version of my answer was, “Yes, brands still matter, but not as much as they once did.” I anticipated that I might get some response from aftermarket brand and marketing managers about the contention that brand influence is diminishing. However, I did not anticipate such a reaction or range of questions as I’ve gotten about exclusive national brands.

Questions ranged from, “What’s an exclusive national brand?” to “What’s the difference between an exclusive national brand and a private label brand?” to “How could an aftermarket manufacturer afford to support their own brand and an exclusive national brand?” I quickly realized I’d violated a basic journalistic precept — don’t assume common knowledge on narrow topics.

An exclusive national brand is a brand that in every way looks and feels like a national brand (one that is owned by a manufacturer or supplier), but is owned by a reseller and is available exclusively at their selling locations. It typically consists of first-quality merchandise that is styled, designed and packaged to be the equivalent of national brands. Moreover, it is typically limited to a single line of products or a group of products that are closely related and not applied to dissimilar product categories.                         

A couple of good examples are Craftsman Tools and Behr Paint. The former has been the most recognized brand of hand tools for the better part of a century and is available exclusively at Sears. The brand was skillfully managed for decades, but has slipped the past few years, as has Sears in general. Similar to Craftsman in its glory days, Behr Paint is positioned and perceived as a leading quality brand of paint and most people are a little surprised that the brand is available exclusively at The Home Depot. 

While exclusive national brands have become commonplace and continue to flourish in other industries, I would argue that they have yet to significantly emerge in the aftermarket. I’m sure there are some resellers that would take exception with that last comment, but I stand by it. What I observe in the aftermarket are nothing more than traditional “private label brands” and “house brands.”

For the record, the distinction I make between private labels and house brands is that the name of the store appears on the package of a house brand. The important difference between both these types of brands and exclusive national brands is that they are most often applied to a range of product categories. This is very significant because of the effect it has on customer perception. A private label or house brand that a reseller applies to a wide range of product categories is often viewed by aftermarket consumers (especially technicians) as being of lower quality and coming from plants in low-cost countries that have little design innovation behind them. While they are viewed as “appropriate” for certain applications in certain circumstances, they are not viewed by technicians as suitable for the majority of their customers.

There are exceptions, notably the very large program groups whose “house brands” are understood by technicians as “reboxed” products, but are viewed with the same esteem as the supplier that is indicated on the box.

I’m not sure if or how soon we might see the emergence of exclusive national brands in the aftermarket. Many, if not most, of the resellers who have established private or house brands seem to be committed to a strategy that applies those brands to a broad range of product. While they seem content that such tactics are appropriate, my own research would indicate that technicians might think otherwise.

The obstacles to establishing exclusive national brands in the aftermarket are significant, and we will examine those next month.