Brand vs. Brandless: The Epic Battle
Guest article by Hari TN
Would you replace your favorite brand of soap or shampoo—products you use daily—with unbranded alternatives? Most people would instinctively respond with a firm no. However, if the products in question were a packet of sugar or a tube of toothpaste, the response might differ. While many might be open to using unbranded sugar, they may still hesitate when it comes to unbranded toothpaste.
This contrast illustrates a key point: some product categories are inherently more amenable to commoditization—and, consequently, to being unbranded—than others.
Take ‘Atta’ (wheat flour) for example. It might seem like a product easily commoditized, yet this belief has been challenged by the success of Aashirvaad, a brand from ITC. Aashirvaad has not only dominated the ‘Atta’ segment but has also made it extremely difficult for private labels to gain a foothold. The brand's iconic status is largely due to ITC’s obsessive focus on quality, ensuring that the flour produces soft rotis that remain fresh for several hours after baking.
The Emergence of Store Brands
The longstanding tension between the power of brands and the power of distribution has been a central theme in consumer markets for decades. As retail became increasingly corporatized and large-format chains emerged, store brands—also known as private labels—began gaining ground.
Faced with escalating real estate and operational costs, retail chains sought innovative methods to enhance margins. Initially, they stocked well-known consumer brands on their shelves. These brands, managed by consumer goods companies, generated demand through a careful mix of product quality, advertising, pricing, and distribution—the classical four Ps of marketing.
Over time, retail chains began to question whether they could create and promote their own brands. While these store brands lacked the same consumer pull as established names, this was counterbalanced by giving them more prominent shelf space and visibility. Unlike traditional brands that depend on advertising to attract customers, store brands relied heavily on in-store placement and competitive pricing, made possible by minimal investment in brand-building.
Store brands initially entered low-differentiation categories, such as staples and packaged food. Gradually, retailers realized they could expand into more diverse and challenging segments, although the degree of difficulty varied by category.
As one observer aptly noted, “After mastering the art of selling everyone else’s stuff, retail chains and marketplaces began persuading shoppers to buy their own stuff.”
The Shift to Online Private Labels
If physical retail chains could use their distribution reach and customer access to promote in-house brands, it was inevitable that online marketplaces would follow. This is now well underway.
Apparel, for example, is a category where fit and style are critical, yet the barriers to entry are relatively low—particularly when design can be scaled and delivered affordably. Amazon, for instance, has launched close to 80 private labels and has surpassed Macy’s in apparel sales, a category where Macy’s once held undisputed leadership. As a competitive response, Macy’s has begun offering exclusive brands that are unavailable elsewhere and is evolving into a true omni-channel retailer.
The Rise of ‘Brandless’
While some argue that private labels will eventually overtake traditional brands, others are equally confident that brands will endure—if they continue to offer genuine value.
A notable player in this evolving landscape is Brandless, a U.S.-based e-commerce company backed by SoftBank. The company manufactures and sells food, beauty and personal care products, and household goods—all under its own minimalist “Brandless” label. Its business model is predicated on offering high-quality products without the typical brand markup, directly challenging giants like Amazon.
Why Brands Endure
Brands have endured over decades for good reason: they deliver clear, differentiated value propositions for defined consumer segments. Consumers associate specific imagery and attributes with brands—and often derive identity and trust from them. This satisfies a deep psychological and emotional need, making brand loyalty difficult to disrupt.
However, brands that lack a strong or distinctive value proposition are increasingly vulnerable. These weaker brands are more likely to be displaced by private labels and store-owned brands that offer similar products at lower prices.
Conclusion
The battle between "Brands" and "Brandless" is shaping up to be a defining contest in the modern consumer marketplace. While private labels are poised for growth—especially in categories with low differentiation—traditional brands that continue to innovate, differentiate, and connect emotionally with consumers will remain resilient.
Rather than a zero-sum outcome, the future will likely see a coexistence of both models, with market dynamics shifting based on product category, consumer mindset, and value perception.
One thing is certain: the clash between branded and brandless is not just a competition of price points, but a deeper contest of trust, perception, and identity. And this battle is just getting started.