-Martha Engel, Attorney

Several years ago I wrote a post about Selfridges’ “No Noise” campaign, featuring de-branded items from brands like Heinz, Clinique, and Levi’s.  In that post, I asked whether de-branded design would soon become a new trend.

It looks like we might be there at least in theory with Brandless, a startup retailer that, as today’s Wall Street Journal article stated, “is betting it can get American shoppers to break up with big brands from Colgate to Heinz.”

The premise with Brandless is that everything – soap, pasta, and even a pizza cutter – is $3 and everything is labeled with the generic product name.  As they say on their blog, they also “hacked the BrandTax™, the hidden costs you pay for a national brand often associated with production and retailer margin.”

But isn’t Brandless doing arguably the opposite of its name and establishing its own brand?  You can see their smart attempts to cultivate their own brand by the consistent use of a bordered, white, label-like background with a TM next to it.  In addition to filings for their BRANDLESS mark and even BRANDTAX, they also filed an application last month for the following  “white rectangle with rounded edges” mark.

This label-like mark seems like the Gene Simmons “devil horns” trademark equivalent to the packaged good industry.

In a crowded field of online retailers chasing Amazon dreams, can a brand like Brandless break away from the bunch with de-branded products?  Unlike Target’s Up & Up line of private labeled products, consumers have little to no experience or knowledge of the source of these products to confirm their quality.  Will this be a hard sell?  Maybe not if the price of $3 and the consumer engagement is right.

  • James Mahoney

    So the dollar store bumps up to three bucks and marries the generic packaging idea from the ’70s. Might as well throw in a BJ’s/Costco-like membership, too (which they do).

    I’m skeptical of their biz model, though one hopes they did enough market research to justify launching the business. As The Wall Street Journal article points out, some products are less expensive than the brand-name equivalents, some more expensive.

    But you’d have to buy a lot of product to get any kind of savings: $72 for free shipping ($48 if you’re a member at $36 a year). Otherwise, shipping can sting ya: $9 to ship a test $24 purchase to the east coast.

    I think you hit one of the nails on the head with the observation that the quality and sources are unknown. Until some substantial number of trusted folks buy those pigs in the poke, how many people will take the chance? And how many will desert their tried-and-trues for a couple of bucks?

    The whole BrandTax ploy is a canard, and a shopworn one at that. Of course marketing costs are factored into product pricing (including Brandless’s $3), but that’s only one element. Brandless would have you believe the “brand tax” (aka marketing costs) adds 40% to 370% of the cost of “comparable quality” products that they sell. Those figures are according the Brandless’s own “benchmarking” of five “major retailers.” It’s a pretty good story on the face of it until you realize that 40% of $3 is $1.20 at regular pricing. It also ignores coupons and regular promotional pricing.

    And is that top-end estimated 370% brand tax on face cream incentive enough to make you change? Would you really trade your favorite hypothetical $11.10 face cream for a $3 generic? Not for my silky smooth cheeks, thank you.

    All that said, it’ll be interesting to see how they play out. But the end times for brands? Nah.