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Retailers Squeezing Brands More Than Ever

  • Ad Age, Monday, November 30, 2009 10:44 AM
Even major, well-advertised brands are not immune to retailer's efforts to improve margins and lower prices these days, Jack Neff reports. You just have to look at Costco's decision to strip Coca-Cola products from its shelves in a pricing dispute to realize that.

CVS/Caremark will remove most Energizer alkaline batteries from its stores by early next year, claiming that it found that customers respond best to seeing a single national brand -- Duracell -- in alkaline.

But Neff reports that analysts and marketers believe that increasing leverage and margin at the expense of brands is another goal of retailers. CVS recently began billing back manufacturers the difference between the profit they made on their brands and what they expect to make. It's not clear if anyone is paying, however.



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