1. Private Label Report Publication date: June 2019 Next publication:
January 2020
Private Label Report

2. Private Label What is Private Label? PRIVATE LABEL
Private Brand
Dealer-Own-Brand
House Brand
Confined Label
Exclusive Brand
Private Label
What is Private Label?
There is often confusion around the difference between private label, confined label, dealer-own- brand, exclusive brand and house brand. These terms are often used interchangeably and sometimes incorrectly. As such, please refer to the below definitions for clarity, the term private label encompasses both. For the purpose of this report, focus remains mainly on private brand.
NEED TO KNOW MORE
Private Brand, Dealer-Own-Brand and House Brand:
A brand of product(s) that is exclusively manufactured by a contract or third-party manufacturer for a retailer, according to retailer specifications, and sold under a retailer’s brand name. Private brand is often tiered according to ‘good, better, best’ brand positioning, however these tiers are defined differently across retailers i.e. some might refer to premium / national brand equivalent / value or fit for purpose.
Globally, certain retailers (i.e. Lidl) are moving towards vertical integration with their private brand products (i.e. owning the factories which private brands are manufactured in).
Confined Label, Exclusive Brand:
A brand of product(s) owned by a manufacturer or producer but exclusive rights are given to a retailer to be the sole distributor of the product to the market.
Let’s take you on a journey down the shopping aisles of Clicks, showcasing their most prominent private brand products.
| Clicks Group | Private Label

3. Private Label Role of private label Strategy
To provide a differentiated product offering that adds value through competitive pricing
To entrench the trust and loyalty that shoppers associate with the Clicks brand, demonstrated through the ability to transcend product categories and markets
Strategy
To support the Clicks strategy of being the customer's first choice of pharmacy, health and beauty retailer in South Africa
To deliver a competitive and differentiated product offer, at higher margins, through wide ranges of private and exclusive brands and franchise brands
To grow front shop sales by increasing private label and exclusive brand sales to 29.5%
To grow Clicks private label to 25% of health and beauty sales (currently 22%)
To use innovation to increase volume: 300+ Sorbet product lines were added in FY2018
To expand private label scheduled generic medicines range with 34 new products (currently +120 SKUs), as part of the strategy to make healthcare more affordable
”Private label, exclusive and international franchise brands ensure Clicks provides a differentiated product offer to customers and reinforce our value proposition.” David Kneale, Group Strategic Adviser, former Clicks Group CEO
Contribution of private label
Private label contributed 22% to total sales, in FY2018
29.5% of front-shop sales
5.6% of pharmacy sales
One in every three front-shop products sold being only available in Clicks (based on volume sales), private-label and exclusive brand penetration is one of the highest amongst retailers in South Africa
| Clicks Group | Private Label

4. Clicks Private Brands | Health and Home
Private Label
Clicks Private Brands | Health and Home
PRIVATE BRANDS
CLICKS PAY LESS
CLICKS ESSENTIALS
CLICKS SMART BITE
CLICKS SMARTLIFE
Shopper Profile
LSM 4-10
LSM 6-10
LSM 8-10
Strategic Brand Positioning
Good (Value)
Reliable, no-frills budget basics
Distinctive blue Clicks branding with red Pay Less logo
Better (Standard)
Trusted alternatives to top brands
Distinctive product range branding with unique logo
Reliable basics to alternatives to top brands
Distinctive with unique product range branding logo
Price Positioning
Price fighter
Everyday low prices - cheapest on shelf
Value-for-money
Same quality at a better price
SKUs
Essential Items Across Health, Home & Beauty Categories
Nutritional Supplements
Health Foods
Home Accessories
| Clicks Group | Private Label

5. CLICKS SKINCARE COLLECTION
Private Label
What are the Private Brands in Clicks | Beauty & Toiletries
PRIVATE BRAND
CLICKS AFRI TRUE
CLICKS SKINCARE COLLECTION
CLICKS INTIMATE
CLICKS REVIVE
CLICKS SUN PROTECT
Shopper Profile
LSM 6-10
LSM 8-10
Strategic Brand Positioning
Better (Quality)
Trusted alternatives to top brands
Distinctive product range branding with unique logo
Better (Standard)
Reliable basics to alternatives to top brands
Price Positioning
Value-for-money
Same quality at a better price
SKUs
Hair Care & Hair Treatments
Skincare Range
Feminine and Intimacy Care
Men’s Soaps & Toiletries
Sun Protection Range
| Clicks Group | Private Label

6. What are the Private Brands in Clicks | Beauty, Toiletries and Baby
Private Label
What are the Private Brands in Clicks | Beauty, Toiletries and Baby
PRIVATE BRANDS
CLICKS
CLICKS ESSENTIALS
CLICKS OH-SO- PRETTY
CLICKS MADE4BABY
CLICKS HYGIENE
Shopper Profile
LSM 6-10
Strategic Brand Positioning
Better (Standard)
Reliable basics to alternatives to top brands
Variation in branding: standard Clicks to category leader
Trusted alternatives to top brands
Trusted alternatives to top brands
Distinctive product range branding with unique logo
Price Positioning
Value-for-money
Same quality at a better price
SKUs
Essential Items Across Health, Home & Beauty Categories
Hair Care, Skincare, Home
Hair Accessories: children
Baby Care
Soaps, Hand Sanitisers
| Clicks Group | Private Label

7. What are the franchise and exclusive brands in Clicks?
Private Label
What are the franchise and exclusive brands in Clicks?
Exclusive Franchise Brands
Franchise brands, are available across health and beauty categories, and build on Clicks’ private brand range, through stand alone stores, as well as a portfolio of products within Clicks stores
The portfolio of exclusive franchise brands, namely The Body Shop, GNC, Sorbet and Claire’s augment Clicks’ private label brands in the health and beauty categories
Exclusive and Dealer-own Brands
The Clicks product range also includes an extensive, complementary exclusive brands range such as, but not limited to:
Homeware: Safeway and Kambrook
Personal Care: OH So Heavenly
Cosmetics: Wet n Wild and Nyx Professional Make-up
Fragrances: Steel & Ice and Enchante
Confectionary: D’licious
| Clicks Group | Private Label

8. Strategic brand positioning
Private Label
Strategic brand positioning
“Feel Good, Pay Less”, with shoppers trusting the brand and responding positively to promotions and differentiated product ranges
Products have the ability to transcend product categories, taking on market leaders through innovation and price competitiveness
Clicks Sun Protection
Clicks Made 4 Baby Diapers
Clicks Nutritional Supplements
Clicks First Aid
| Clicks Group | Private Label

9. Private Label
Price Positioning | Price Fighter (Good) and Value for Money (Best) vs. Market Leader
Positioned as a value retailier, Clicks invest aggressively in price – relying on markdowns and promotional specials to drive sales and volume growth
The value of the ‘3 for 2’ promotional strategy is very attractive to shoppers
Value for Money (Best)
Price Fighter (Good)
Market leader
R35.26 per 500 ml on 3-for-2 promotion
R29,96 per 500 ml on 3-for-2 promotion
R64,99 per 500 ml (no promotion)
= below 50% of market leader
price per volume
Note: pricing as at
| Clicks Group | Private Label

10. What media platforms are used to communicate Clicks Private Brand
Private Label
What media platforms are used to communicate Clicks Private Brand
Print
Website
Clicks private brand features in the Clicks ClubCard magazine, broadsheets (in-store and newspaper), online and in-store promotional catalogues
Clicks private brand features across categories and forms part of various promotions and discounts within these categories, such as price off, bulk offers, 3-for-2 and mix & match.
Social Media
Facebook showcases Clicks private brands within value promotions
Twitter posts feature beauty offerings from Exclusive and Franchise brands. Clicks private brands feature within select value promotions
1,014m followers (May 2019)
163k followers (May 2019)
| Clicks Group | Private Label

11. What’s going on in-store?
Private Label
What’s going on in-store?
Private Brand blurring Market Leader Brands
Clicks private brand competes with market leaders in general and niche categories, mimicking colour coding, packaging shape and label artwork, at markedly reduced prices
Private Brand Owning Sub-categories
In the personal care category, such as hair accessories, Clicks private brand and exclusive franchise brands dominate, with no branded product competing on shelf
Clicks Shampoo, Feminine Care, Magnesium and Baby Wash next to market leaders in the respective categories.
Private & Exclusive Franchise Brand Hair Accessories
| Clicks Group | Private Label

12. Maryla Masojada | Lead Analyst Andrea du Plessis | Associate Analyst