Dive Brief:

• Sprouts announced Tuesday that Gilliam Phipps will join the company as chief marketing officer, senior vice president effective April 14, the company reported. In his role, Phipps will report directly to CEO Jack Sinclair and oversee the retailer’s marketing efforts, advertising, customer engagement and private label teams.
• Phipps’ previous role was vice president of branding, marketing and “Our Brands” at Kroger. Prior to Kroger, Phipps spent 11 years at H-E-B where he held many roles including director of the grocer's "Own Brand" division, overseeing innovation, branding, product development, packaging and design.
• In a statement, Sprouts CEO Jack Sinclair said that Phipps will be tasked with developing the retailer's brand strategy and awareness, as well as strengthening its private label lines.  

Dive Insight:

With two decades of marketing experience, Phipps could be instrumental in helping the natural grocer strengthen its private label portfolio, a segment he holds particular expertise in as he helped transformed Kroger into a private label powerhouse. 

Sprouts has steadily increased its private label penetration in recent years, and is set to push the needle further as competing chains make store brands core to their sales strategies. In October, Sinclair noted that Sprouts' selection has increased to over 2,000 own brands, but the company was offering too many sub-brands. 

“We plan to build a cohesive private label brand, streamlining and improving our communication to customers that maximize the Sprouts position as the affordable, healthy living grocer,” Sinclair noted in the retailer's Q3 earnings report. He also pointed out that the retailer could do a better job of "telling the brand story."

These strategies are all familiar to private label expert Phipps, who broadened and elevated assortments under Kroger's budget brand, Private Selections premium brand and Simple Truth natural and organic line. In 2011, a year before Phipps joined Kroger, the grocer reported $15 billion in annual private label sales and by 2019, it had grown to over $23 billion. Its Our Brands achieved 30% unit share last year. 

Phipps previously told Grocery Dive that the key to growth is creating new products and customers haven’t encountered before, rather than just national brand replicas. His approach could help Sprouts focus its private label offerings as it looks to create a sustainable strategy that builds customer loyalty and drivers larger profit margins.