Retail intelligence company Planet Retail recently published a report on private label trends—"Private Label: The Brands of the Future"—and it has quickly become its best selling report ever. It makes important reading for the licensing industry on two counts. Firstly, because private label is a burgeoning retail trend that affects anyone hoping to get in the big chains. Secondly, because the report highlights licensing as one of the key opportunities in the private label business as it grows from being a price-orientated offering to becoming a dominant force in retailing, particularly in grocers. And it's a trend that is more pervasive in Europe than it currently is in the U.S.

Large-scale examples of retailers working with entertainment brands to create their own label ranges already exist. For example, Disney Kids at Carrefour and Looney Tunes Active at Systeme U are both grocery ranges that have grown and expanded over the last 12 months. With 200 SKUs, the Looney Tunes deal is the largest direct-to-retail in Europe. This trend looks set to widen as the relationship between private label and consumer changes profoundly. And it's not just the biggest companies that may profit.

Planet Retail's report sets out the history of private label, how these product ranges (often blandly presented) started out with price as their only differentiation. Subsequently (and helped by a discerning but recession-hit consumer), they have assumed brand values and customer loyalty of their own. The report identifies the expansion of the "super premium" private label that is evident in many European retailers. Tesco, for example, has couture apparel on sale for up to $227 (£150) and a high-end meals line with dishes at $15 (£10). Private label niche ranges, such as gluten-free or halal, are also proliferating around Europe. It suggests that retailers' own brands have the power to become the fast-moving consumer goods brands of the future, backed by advertising and even distributed elsewhere. Some, such as Waitrose, are already doing this.

Where does licensing come in? Just as it always has done—as an opportunity to create differentiation and innovation. The report states: "The drive for private label in a weak economy has accelerated the quest for quality brand franchises for licensed products across virtually all categories. Opportunities exist for both pure licensing and DTR. Retailers benefit by offering a unique and innovative product, licensees benefit from the growing private label market and, in the case of DTR, are able to build long-term partnerships with retailers."

And it's not just in grocery, but also in children's wear and health and beauty where the trend is growing. Working with a license can also help retailers to expand a private label line into new categories.

Planet Retail's global research director Bryan Roberts will be discussing the opportunities for licensed brands in the private label business at a seminar at Brand Licensing Europe on Sept. 28. Roberts believes that while some of licensing's biggest companies are re-aligning to concentrate on private-label relationships with retailers, it's a business model that isn't out of reach for smaller brands and he will examine the opportunities it presents.

Nearly half of the sales at Tesco, the U.K.'s biggest supermarket, are of own-brand products. As SKU rationalization becomes more aggressive (Planet Retail suggests Walmart intends a 15 percent decrease in the U.S. and 30 percent decrease in product lines in the U.K.), brands are going to need to be inventive to survive. It will also mean being more collaborative and engaging more directly with the consumer, both qualities that should come easily to the managers of many properties in the marketplace.