Chicago — Dollar sales for private label products increased 3.8 percent during 2019, a growth rate that is twice what national brands saw during the year, according to IRI, which notes shoppers are drawn to store brands for quality as well as value.
“While shoppers across generations and income groups in 2019 are undoubtedly more price conscious, they are turning to private label because of their positive perceptions of the value,” adds Joan Driggs, vice-president of content and thought leadership. “Shoppers are buying private brands because it makes them feel good to save money without sacrificing taste, selection or quality. The improved consumer perception of private label value is having a growing influence on store choice, with many leading retailers offering premium private label selections.”
The market research company reports nearly all, 99.9 percent, of shoppers buy private label today, as they see these brands as go-to solutions in the retailers they trust. As a result, merchants are doubling-down on store brands and offering more premium selections.
Across generations, millennials have embraced private label products the most, with purchases increasing 10 percent year-on-year and outpacing the cohort’s adoption of national brands, IRI reports.
“Private label is experiencing growth that outpaces that of national brands and has increasing influence on store choice among consumers, especially among gen Z,” says Driggs. “However, there remains room for improvement. Packaging image has been found to be a purchase barrier among millennials and light buyers. In addition to packaging, retailers should continue to find ways to innovate. Don’t wait for national brands to lead with trends, such as plant-based, functional and wellness products.”