To cultivate customer loyalty and boost confidence in product quality, the nation's two largest hypermarket operators are launching their own brand labels, as they hope to expand their customer bases even further.
Carrefour Taiwan, which operates 37 outlets nationwide, is launching a large-scale marketing campaign to strengthen brand awareness of its quality-oriented own-brand product line under the name "Carrefour," which will be priced 20 percent lower than other leading brands.
Its other private label, No. 1, which relies on pricing as its competitive edge, offers products with prices 40 percent cheaper than competing goods.
Increasing the value and sales of private labels has been a trend for international retailers. Europe and North America have seen own-brand products secure 23 and 16 percent of the market, respectively.
In contrast, local retailers apparently see great potential for this segment's development in Taiwan from its current less-than-ten percent market share, said Marc Oursin, Carrefour Taiwan general manager.
"Carrefour will launch a series of campaigns for the Carrefour brand ... We target a 20 percent share of sales by the end of this year and are chasing the same share achieved in more developed markets by 2007," he said.
Operating along the same lines, RT-Mart (大潤發) plans to adopt a dual-brand strategy by introducing its own "top-class" private label, provisionally named "RT-Mart," in the latter half of this year to complement its low-priced "First Price" brand, said PR official Margery Ho (何默真).
RT Mart expect to increase the First Price product lineup from its current 1,200 items to 1,500 items by the year-end, she noted.
However, the popularity of such brands is low in Taiwan as 73 percent of local consumers said they did not trust the quality of own-brand products, according to a survey conducted by ACNielsen Taiwan in September last year.
The report pointed out that image building and consumer education are the biggest challenges for retailers when trying to win consumer trust in their own-brand products.
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