I was telling a colleague about Hema, a dutch chain of stores that sell everyday staples; “everything from a needle to an anchor” my grandfather would say.  Well they don’t sell anchors but they do sell needles and all sorts of other useful things you need, regularly, for round the house.  And everything is their own brand.

It started me wondering about the rise of manufacturer-retailers or retailer-manufacturers, and single brand stores.  So I wandered around the shops and took note of which were multi-brand stores, like (most) supermarkets and department stores, and which were single brand chains.  It’s fascinating how the world looks different when you look at it systematically, out of “everyday mode”.  I expected to find lots of retailers who stocked multiple brands but they are a tiny minority – and look to be disappearing.  My list is at the end of this post, I could have gone on walking and made it five times as long but you can see most stores are singe brand.

Indeed I’m sitting in an Apple store writing this post.  An LA-based computer manufacturer that once had no stores, now it operates this store here in France and quite a few more like it around the globe.  When I was a student at university I remember quite a few case studies of manufacturers that had tried to get into retail to ensure distribution (e.g. brewers who bought pubs) and how it had often back-fired; manufacturing and retailing are different businesses was the lesson.  Well it seems that management has improved and many firms can do it (see list below), and many retailers find that they can have a central office buying (and branding and marketing) and that makes life more simple than having to stock their stores by choosing stock from many sellers.  The retail staff can just concentrate on retailing, whereas a purely retail store has to buy and sell.  This is perhaps why we see chains replacing owner-operated stores, even (sadly) in restaurants (though thankfully not in France).

There are a few exceptions like shoe stores, opticians, and cosmetic stores but even here there are single brand stores (e.g. L’Occitane, Julique), where the manufacturer (or designer or at least buyer) is also the retailer.  Department stores, supermarkets and wine stores are among the last, it seems, where the norm is for them to stock themselves with many brands from competing manufacturers – though even here they usually have their own private label brand along with the others.

So what does this mean for marketing?  In some ways it’s an indictment on the quality (and quantity) of marketing by manufacturers.  They were poor at building their brands, and retailers found that their retail presence was as good at building mental availability as the (little bit) of advertising that the manufacturers were doing.  Of course, it also shows that some manufacturers worked out how to be retailers, and very good retailers.  So it’s also an indictment on retailers who operated largely as shelf stockers, renting space to competing brands.

Will dedicated manufacturer-marketers and retailer-marketers survive?  Meaning stores that stock multiple brands?  I think we have the answer, the future is largely already here.  Yes there will be a few, a few dept stores, supermarkets, and some specialist stores.  But the majority will be single brand chain stores, where one head office designs and/or buys/manufactures its own brand’s product range which it sells through its own stores.

OK, what if you own your own shop, stocking manufacturer brands?  Hmm, the tide seems to be flowing against you.  I can’t think of any new chains that have emerged along these lines.

OK what if you are a manufacturer brand marketer without your own retail channel?  Again it looks like the tide of history is not flowing your way.  But can a company like Unilever operate its own stores?  It’s an interesting question; L’Oreal already owns The Body Shop.  Procter & Gamble and others have their “toe in the water” with their own online stores but that’s a long way from having a Hema type store stocked entirely by P&G.

Will we see wine stores dedicated to a single company? We already see some stores that stock many brands that are in effect commissioned by them, they own or control the marketing of these brands.  But might we see a large luxury wine brand like Penfolds open its own stores.  Nespresso did it – if only to use stores as a way of showcasing/advertising the brand.

Hmmm, predicting the future is difficult, but while 10 years ago the idea of manufacturers who depended on many different retailers, like Apple and Levi, opening their own stores and surviving seemed unlikely. And it has happenned.

PS Retail marketing scientist Herb Sorensen points out that “own brand stores” are a strike back by manufacturers at “private label”.

List single brand retail chains I made walking around Bordeaux:

H&M

Levi’s

Mango

Paul

Pimkie

Pull&Bear

Jules

Etam

Bocage

Heyraud

Minelli

Apple

Guess

Oliver Grant

MaxMara

Minelli

Atelson

Aigle

Somewhere

IKKS

BCNGMaxazria

Diesel

Zapa

Gant

JB Martin

Faconnable

Eden Park

Hugo Boss

L’epetto

Lancel

Father. & son

Devernois

Orange

Baillardran

Alain Figaret

Louis Vuitton

Nespresso

Hermes

Weill

Laingo

Ballon

Florence Kooijman

Mangas

Pain de sucre

Eric Bompard

Olivers & co (olive oil !!)

Petrusse

Rosa Bagh

Alienor chocolatier

Osaka

and so on…..

Exceptions I noted:

Pharmacies

Galleries Lafayette

Bijoutiers but only some

Opticiens

Cosmetics but only some

Manfield – shoes

Outdoor and sports clothing

Kitchenware/design

Wine shops