Brand owners reluctant to fight 'parasitic packing' of retailer own-label products

The report attacks UK supermarket chains, accusing them of systematically copying the packaging and branding of food and drink products. Discount retailers Lidl and Aldi, in particular, come under fire for confusing consumers with 'parasitic packaging'. However, supermarkets Sainsbury's, Asda, Tesco and Somerfield are also criticised for presenting own-label products that it claims are too similar to equivalent brands.

Report contributor David Haigh, chief executive at consultancy Brand Finance, goes so far as to accuse the supermarkets of 'theft'. 'Branded products owe as much to their packaging design as to their brand names,' he says. 'Their owners invest vast amounts to differentiate themselves, and copying unfairly expropriates that goodwill and steals value.'

A High Court case between United Biscuits (UB) and Asda in 1997 remains the only major instance when accusations of passing-off have reached court. Asda was found guilty of passing off its own-brand Puffin bar as UB's Penguin chocolate biscuit. However, Asda was permitted to retain the name with the proviso that it amended its packaging.

BBG director John Noble is keen to make greater use of the legal system by enforcing consumer protection legislation introduced last year. The Office of Fair Trading is to implement the regulations, and Noble hopes this will provide a more fruitful avenue for brands than intellectual property law.

Richard Kempner, senior partner at specialist intellectual property law firm Kempner Robinson, insists the law is in place to protect brands but that many choose to avoid legal proceedings.

'No brand wants to take its largest customer to court,' says Kempner, who has represented both Asda and Premier Foods. 'But just because there are few reported cases, it doesn't mean that brands don't raise objections with supermarkets on a regular basis.'

A rising number of brands are basing marketing strategies on combating own-label rivals rather than competitor brands, claims Catriona Northridge, senior consultant at branding agency Clear. It is, she believes, unnecessary.

'A confident brand should have faith in its relationship with customers, and even be flattered by the imitation. Customers will see through a blatant copycat brand,' she adds.

Yet Colin Mechan, creative director at brand consultancy flb, argues that the supermarkets are simply aiming to guide consumers. 'They are trying to create brands in their own right, albeit by using category cues and colours.'

This is a view echoed by an Aldi spokeswoman, who argues it is only conforming to category expectations. 'Aldi uses the generic colours and iconography of the category to help shoppers navigate the store environment as they seek familiar products.'

Mechan, who oversees own-label designs for Asda and Somerfield, agrees that some budget retailers have gone too far toward copycat branding, but says UK supermarkets are more concerned with brand-building.

A Lidl spokesman, meanwhile, says that of its 1600 products only 10 have packaging similar to comparable brands.

The problem, then, for owners of successful brands is that aspects of packaging and marketing may become seen as category cues, rather than cues to the brand itself.

Supermarkets are in a prime position to exploit this situation. It is for brand marketers to decide whether to tolerate possible infringements or risk falling out with major customers in court.

 

This article was first published on marketingmagazine.co.uk