Generics: Will history repeat itself?
Amid our country’s decades-high inflation, some are predicting interest rates will skyrocket, as well. It reminds many economists of the same situation that occurred in the late 1970s.
As a young produce clerk at the time, I recall people being plenty nervous: unsteady world events arising, namely Middle East tensions; fuel prices doubling overnight, then doubling again, pushing up the price of everything, especially food.
That’s when grocers came up with an unusual approach: the introduction of generic products.
Do you remember generic groceries? Every product had something printed upon it, such as: “This product may vary in size, shape or color. The nutrition value is equal to name brands. It is suitable for everyday use.” The idea at the time was that a no-frills product would save the consumer some money by minimizing the high cost of excessive or high-color packaging. Although consumers didn’t get much choice when it came to, say, a bottle of ketchup, it was a plain-Jane, one-size offering.
But that ketchup was noticeably less expensive, and many customers responded accordingly.
Our chain jumped into generics with a passion. We devoted an entire two-sided aisle to generics. The ceiling was draped in black-and-white crepe paper streamers to match the product colors beneath.
Related: Retailers: Hold fast to standards
As for the produce department, we stocked a dozen or so generic products, as well. At first it was a challenge. We were a mostly bulk produce operation. How do you take part in a generic program? We answered the call by introducing a separate line of bagged produce, black-and-white packaging of course. The product placement was at the heart of the department, on a table underneath the same-colored, black-and-white streamers, much like our grocery counterparts.
The generic, black-and-white packaged produce was a grade or so lower than our regular, premium produce offered.
As expected, some products sold well. Others sold much slower than our premium offerings. Why? It’s hard to tell. Although stocking alongside shoppers every day, we couldn’t help but overhear the comments: “This doesn’t look the same as what I’m used to buying” or “Something must be wrong with this produce. No thanks.”
Mostly, acceptance or rejection had more to do with quality concerns or the pack size of the generics than anything else. If a consumer is used to buying a specific variety, such as a 3-pound bag of apples, it’s a big swing to expect them to buy a different variety, lesser-grade, 8-pound bag — even if it did work out to less price per pound. Especially then, shoppers knew that if they had to toss out half of the bag of apples, any savings realized would go right into the trash bin.
As it turns out, generics were like any untested product line, with a finite life cycle. At first, generic produce was a curiosity. Then, we saw a robust interest and some promising sales, but only with limited commodities. Eventually, the economy and world events calmed in the early 1980s, and generic sales overall tanked. And like any subpar marketing venture, generics were eventually phased out in favor of products (especially store brands) that better commanded valuable grocery store space.
Will generics (both in grocery and fresh produce) make a cameo appearance among the post-pandemic, inflation unrest? I suspect not. However, I never saw the first wave coming, either.
