In what some observers are interpreting as a defensive move against U.S. retail giant Wal-Mart, Canadian discount chain Zellers launched a massive private label program last week that cuts across most of its current product offerings.
The ‘Truly’ brand boasts items in such categories as household products, health and beauty aids, nutritional supplements and apparel. Zellers, owned by the Hudson Bay Company, plans to extend the private label into the food sector later this year, according to a company spokesperson.
‘We think this is the most extensive program of its kind in Canada,’ says Paula Zivot, Truly brand manager. ‘Truly was created to have a brand in a good price positioning that could compete on an everyday low price basis with similar items of national brand quality and with our competitors.’
Truly may also help Zellers to further differentiate itself from Wal-Mart, says retail analyst Peter Dzendoletas, of Toronto-based Thomas Consultants International.
‘It’s similar to the strategy JC Penney used when they developed their own branding, although JC Penney did not do it with food. It proved to be pretty successful against Wal-Mart, and it should make it easier for Zellers to position itself.’
To build awareness of the new private label, Ogilvy & Mather has developed a television campaign designed to highlight both the quality and the competitive pricing of the brand. Credit inserts will complement the television spots and a host of point-of-sale materials, says Zivot.
Zellers has not yet decided whether it will introduce the Truly line to Best Value, its chain of discount department stores.
