Is Anyone NOT Buying Private Label Supermarket Brands These Days?

 

I have absolutely no shame about avoiding well-known brand names and going with store brands – or niche brands – instead.

I am clearly not alone. As big name brands like Campbell’s, General Mills, Kraft, Coca Cola see their sales plummet, private label along with smaller startup brands, have taken a massive share of the food and beverage category.

  • Even though I have had issues with Whole Foods, it is still my #1 go-to for groceries.
  • I’m a huge fan of their 365 line – inexpensive and on a par with well known brand names.
  • The only other food retailer where I shop with any regularity is Trader Joes – similar in price and quality to Whole Foods 365 brand. It’s my go-to for parties – especially the TJ-branded cheeses, crackers etc.
  • I have not had an opportunity to shop at Lidl – supposedly high quality and very low pricing. I’m under the impression that Amazon is turning Whole Foods into a Lidl-fighter.

So what’s happening?

We’re increasingly opting for niche and newer brands over the trusted names we grew up with. By extension, this “newness” mindset makes us more open to store brands like Whole Foods’ 365.

“Newer” products feel more special to us, they’re more on-trend and their marketing and branding tends to be more engaging and relevant e.g. Archer Farms from Target sounds more appealing than big corporate Heinz.

  •  As a result of this shift in mindset and shopper preferences, established names have turned into LOST BRANDS.
  • Always located in the sad, garish “processed food” section of the supermarket that screams unhealthy and outdated.
  • Those brands are less relevant to shoppers – and definitely not ones found in my kitchen (see photos on left above).

How did store brands pull this off?

Private label has seriously upped its game with 80% of consumers now saying there is no difference between private label and national brands.

  • In the past there was a stigma attached to “generics”, but today, they are full-fledged brands offering quality products, great packaging and excellent pricing.
  • There is even a Private Label Manufacturers Association (PLMA) that organizes trade shows and provides resources for both manufacturers and retailers.

Read on below for important stats on store brands from seekingalpha.com:

 

  • $150 billion of store brand groceries were sold in the U.S. last year.
  • Kroger now sells 30,000 private label products representing 28% of total units sold.
  • Additionally, Kroger forecasts sales of its Simple Truth private label brand will double over the next few years from $1.2 billion today.
  • Costco’s Kirkland Signature brand accounts for 25% of the chain’s grocery sales.
  • 82 % of consumers view private brands as “very” or “somewhat” important to their decision to shop at a particular grocery store.
  • More than 50% of shoppers said they buy more store brands today vs. last year.

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