Italian retailer Unes managed to boost sales of its premium private label range Il Viaggiator Goloso by 63% in 2017. The range now accounts for 12.1% or EUR95mn of its total turnover, according to tweets from its CEO, Mario Gasbarrino, picked up by Italian magazine GDO Week. Unes, which is a subsidiary of Finiper, also grew its total private label penetration from 40.4% to 42.2%. Gasbarrino added that the retailer’s sales grew by 4.6% in 2017 and he anticiaptes even stronger growth in 2018 with Il Viaggiator Goloso expected to reach turnover of EUR138mn.
The retailer has also created a banner under the same name as its premium range, with three stores opened to date, all located in Milan.
In our experience, for a retailer’s premium private label to account for 12.1% of total sales is pretty unique. The range spans across several categories, with many SKUs per category, which has of course naturally helped it reach that share. That said, the label is clearly positioned above the retailer’s standard line, so it’s not just a case of being a glorified regular label. The opening of dedicated Il Viaggiator Goloso stores in Milan has of course also helped boost sales of the label, both directly and by promoting it. It also demonstrates the popularity the range has achieved in Unes’ home region.
Unes' parent company, Finiper has also introduced shop-in-shops, as well as dedicated sections for the label in its hypermarkets. This isn’t included in the figure, so in reality the private label’s total sales should be even higher than EUR95mn. Of course, the presence of the range in Finiper’s Iper La Grande I big boxes has further assisted in strengthening the brand awareness of Il Viaggiator Goloso. The success of U2 Supermercato, Unes main banner, is proof that identifying gaps in the market and committing to filling them can be rewarding. The banner adheres to an EDLP model and stocks a fairly limited assortment of which around half are private labels in the form of umbrella lines. We think this transparency has made it easier for shoppers to trust the quality of the label. Further, Unes being able to focus on promoting a few umbrella lines and linking them to the retailer brand, instead of a plethora of category labels, could also help to explain the strong growth of the label.
Unes is therefore doing a good job of increasing its overall quality perception through Il Viaggiator Goloso. Many European retailers have tried pulling this off, only to then give up. In some markets, premium labels seem to have been more of a fad, then largely replaced by more specific added-value categories such as organic, healthy and free-from. Still, with the country's lagging economy, Italian retailers, trying to stimulate increased grocery shopping, must support any attempt to maintain higher prices. With Italian local food tradition being appreciatively near at hand, a premium label meeting the demands of this is an excellent way to increase store productivity. It is therefore unsurprising that we see many other Italian retailers currently also focussing on expanding their value-added labels.