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Kmart marketing boss: price is more important than brand

The marketing director of Kmart has said that price is more important than brand names for its customers.

“The thing we’ve learned over the last 12 months is that if you can get the product and the price right, the brand becomes less important,” the discount retailer’s head of marketing, Ian Bailey, told Mumbrella.

According to Bailey, Kmart’s home label products are rapidly outselling better known brand names – a trend boosted by the retail squeeze.

“If you put our own labels next to branded products, ours outsell them massively – to the extent that we’re no longer carrying branded products in many areas of the store,” he said.

Using men’s underwear as an example, Bailey said that while a pair of Bonds boxer shorts costs between $15-$18, a packet of three Kmart boxer shorts costs $15.

“I visited our factory in China recently and found that Bonds, Calvin Klein and our own brand of underwear are being made in the exactly same place,” he said.

“Top tier brands such as Apple, Nintendo or Leggo – yes, they have value. But with, say, underwear, crockery or glassware, the quality of our products is at least as good as branded goods.”

Kmart sells jeans for $10 jeans and microwaves for $49, which it can do by sourcing product directly from factories rather than using agents.

According to Bailey, around 50% of what Kmart sells are own label brands, and that proportion is increasing.

In June, Kmart hired a new advertising agency, BWM, which launched its first work for the advertiser in August.

Bailey’s comments come just over a week after Mumbrella highlighted the similarities between brands and Coles home labels.

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