Brands of the Year 2016: Leader of the pack

Here's how President's Choice spent the past 30 years challenging what it means to be a store brand.

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It’s that time again. We’re rolling out our 2016 Brands of the Year, so make sure to check back during this week as we take a look at the brands that had a big impact on Canada this year.

This article appears in the October 2016 issue of strategy.

President’s Choice is an anomaly in the Canadian marketplace – it has come to stand for much more than simply being a cheaper alternative to national name brands. But don’t let anyone at parent company Loblaw hear you describe PC as a store brand.

“I take offense to thinking about President’s Choice as a store brand,” says Uwe Stueckmann, SVP of marketing at Loblaw. “Canadians don’t consider it one. We meticulously track our brand health and equity, and they think about it in the same realm as national brands, and maybe even at a higher level in some cases. It’s a completely different mindset.”

President’s Choice was established in the mid-80s, named for being the “choice” of Loblaw’s then-president Dave Nichol, who regularly appeared as the brand’s spokesperson and whose handwriting was used for the PC logo. Nichol also took a personal interest in the products, from the President’s Blend coffee that would evolve into the PC brand to the Decadent chocolate chip cookies.

The products were meant to live at the intersection of value and quality, competing with and improving on those from national brands instead of simply imitating them.

By 1990, the President’s Choice line included over 500 products and accounted for $1.5 billion in sales. Today, President’s Choice is the largest food brand in Canada by sales volume and sells well over 3,500 different products in Loblaws, Zehrs, Real Canadian Superstore, No Frills and Shoppers Drug Mart locations (among many other Loblaw-owned banners), making it one of the most accessible store brands in Canada.

Loblaws launches roughly 600 new CPG products under the PC brand every year. Some end up being permanent, some are seasonal, and others are introduced to serve a particular consumer taste or need and may be slowly phased out when interest begins to wane or shift.

The PC Green line of environmentally friendly products first appeared in 1989, but to keep pace with evolving consumer needs in the last decade, the brand has introduced Blue Menu for the health conscious, Black Label for those with more premium tastes, and Organics and Free From lines for those who want to know what goes into their food.

The President’s Choice brand has been increasingly deployed in produce and fresh food sections, one of the few areas of the grocery store that has typically had very understated branding. And then there’s the mileage the brand gets in other categories, where Loblaw has routinely converted the trust and goodwill the brand has earned into instant equity as it enters new frontiers.

“President’s Choice is routinely ranked among the most trusted and influential brands in Canada, and having that combination and expanding it the way we have is no accident,” Stueckmann says. “But it’s consistent delivery against a very clearly defined and articulated brand promise that has allowed us to expand President’s Choice so broadly.”

PC was used for the company’s entry into banking in 1998 with President’s Choice Financial – which now also offers home, auto, pet and travel insurance – and PC Mobile in 2005. In Loblaw’s most recent quarterly report, PC Financial reported a 15.8% increase in earnings, and high PC Mobile Shop sales have routinely contributed to the company’s overall performance. And when it came time to launch a loyalty program across all Loblaw-owned grocery banners, it was PC that got the nod for PC Plus in 2013.

While it’s easier to build equity in a single brand, that also means every product and service that carries the PC brand needs to contribute to its brand promise. “We’re very cautious and thoughtful about what we put the brand on,” Stueckmann says.

President’s Choice can be deployed as widely as it has been without being stretched too thin and devalued because it’s remained true to Nichol’s original vision.

“The one thing about President’s Choice is that the DNA never changes. But strategically, we have to constantly remind ourselves what that DNA is,” says Andy MacPherson, VP of product marketing at PC Financial. “If you’re not careful, you can lose the mojo. The brand is a business system, not just a marketing platform, so it has to be embedded in everything we do, whether it’s product development or colleague engagement or customer service.”

PC2Despite its longevity and prominence in the marketplace, President’s Choice has maintained a challenger mentality – perhaps not in terms of brand awareness or affi nity, but regarding what consumers expect from a store brand.

“Most store brands aren’t innovative. Their innovation is just in creating a cheap version of something else,” Stueckmann says. “President’s Choice has always stood for making better products: make them taste better, make them less expensive, make them better for you, make a smarter digital loyalty program, eliminate banking fees.”

Two years ago, Loblaw launched its biggest marketing push to date. Working with John St., it debuted the “Crave More” platform for President’s Choice, approaching its marketing more like a lifestyle brand and less like a packaged goods brand. It had a more modern look and spotlighted more ambitious products, showing off special occasions and entertaining events instead of only showing day-today family living.

Since 2006, marketing for the brand featured Loblaw president Galen G. Weston (in a nod to the days when Nichol was the spokesperson) using PC products in everyday situations in ads led by Bensimon Byrne. While that approach was successful – Weston was ranked highly as a spokesperson in consumer surveys, and campaign launches in 2009 and 2011 drove sales – “Crave More” was a much-needed way to modernize the perception of the President’s Choice brand and show how its product innovations could not just fi t into Canadians’ existing lives, but help to make them better.

“It was inviting Canadians not only to expect more from us, but more from yourself and the life you live as well,” Stueckmann says. “The way we execute and communicate that has been a lot more modern and contemporary than it was in the past. One of our worries that led to ‘Crave More’ was making sure we stayed relevant with our emerging best customer.”

Baby boomers had grown up alongside the President’s Choice brand and knew what it stood for, but Stueckmann says millennials born after its launch are much more food-savvy and worldly. Previous generations had relied on the PC brand to introduce more eclectic foods and fl avours, but younger consumers have a greater ability to seek them out on their own. What’s more, new Canadians bring their own tastes, and aren’t familiar with the PC brand.

In addition to traditional marketing channels like TV and flyers, “Crave More” also saw Loblaw add content marketing to the mix for President’s Choice, with an internal team releasing social content, short-form videos and issues of the long-running PC Insider seasonal magazine that – much like the way it approaches new product innovation – highlights the very latest food trends. The content has focused on the stories behind its new products and why they are worthy of being a “President’s Choice,” or showed how they can be incorporated into an eclectic meal for families and for entertaining.

Recently, PC has been doing more experiential events, working with John St., Mosaic and PR agency Citizen Relations. A holiday pop-up promoted the PC Insider’s Collection, a showcase of its latest and greatest food products curated around a specific trend or situation, with each room themed around a different occasion. The “Babylicious” event this spring invited foodie moms to enjoy prix fixe meals at trendy Toronto restaurants, while their babies were treated to a meal from the new PC Organics baby food line. The “Fake Store” execution invited consumers in to taste-test products, unaware that they were part of the brand’s gluten-free lineup.

“[The campaign] was launched specifically for food, but the concept applies to all other categories,” Stueckmann says.

The company has described “Crave More” as its most “ambitious shift” in its marketing approach, and the brand has emerged with its strong position intact. In the most recent edition of Ipsos’ Most Influential Brand study, President’s Choice ranked thirteenth overall, ninth among women and second among Canadian brands, largely driven by its trustworthiness. In BrandSpark’s 2016 Canadian Shopper Survey, PC Plus was ranked third behind Air Miles and Shoppers Optimum in terms of membership, but pulled into a tie for first when it came to which program consumers valued the most.

MacPherson says PC Financial anchored itself more firmly in the roots of its parent brand three years ago as it increased its above-the-line marketing presence, having previously relied on direct and in-store platforms. It has focused on simplicity, in ads that have portrayed different couples being interviewed in their homes about how not paying annual fees or earning extra PC Points was an easy way to get the extra things they wanted, often to humorous effect.

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While that might not be in line with the aspirational approach of “Crave More,” it keeps with the PC promise.

“The promise of living life well is something we support, because that could mean food discovery and quality, but it also means providing a simple solution for Canadians that works well for what they need,” MacPherson says. “We haven’t been around as long as the bigger banks and there are challenges that come along with that, but it’s also a rallying cry for us. We’re a Main Street bank, not a Bay Street bank.”

The main focus of PC Financial’s marketing over the last year has been centred on the PC World Elite MasterCard, one of many products that offers access to PC Points and other rewards with no annual fees. On the innovation front, PC Financial has kept up with trends like mobile touchless payment options, and it become one of the first banks in Canada to offer instant approval on its MasterCard products, giving customers at certain locations their new card within minutes.

PC Financial’s brand perception is just as strong as its parent brand’s. PC Financial Debit Card was the highest-ranked co-branded debit card for customer satisfaction by Bond Brand Loyalty, with PC Financial as a whole ranked second-highest in terms of customer satisfaction among mid-sized banks by J.D. Power in 2016. It’s been in the top two every year since 2007.

“We’re going against big players in a cluttered financial category that’s being disrupted by fintech,” MacPherson says. “Going back to the PC brand gives us the advantage of built-in trust, which is key for the category. It also gives us personality and the ability to create products that are tied into the masterbrand promise. If you look at the last couple of years, for both PC and PC Financial, you’ve seen a rejuvenation of who we are and being very vocal about it.”

Stueckmann says Loblaw constantly measures President’s Choice’s brand equity compared to national brands, and that has revealed a number of pressures coming to centre-of-store packaged goods in the future.

Consumers have been demanding more fresh, organic and local products, which means the brand will continue to innovate and find ways to respond.

“One thing we often hear in research is that consumers feel like PC brings them products just as they’re thinking of them, it’s right on trend,” Stueckmann says. “That’s a big part of what makes PC what it is. Continuing to be relentless in that pursuit of innovation and value while making sure we always understand the mindset of our consumer has been there since day one, and is something that will always be important.”