T. Ozbun
Research expert covering food retail and all food topics for Italy and Brazil
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Purchases of private label consumer packaged goods generally occur more often in the physical or offline retail channel as opposed to online, as consumers tend to buy private label options from brick-and-mortar stores they trust. However, grocery retailers have tried to overcome their lower online performance, as evidenced by the number of private-label stock keeping units on their websites. Some retailers, such as Aldi, make private label brands the main source of their sales and thus consider them vital in their daily operations. Refrigerated products and general foods were the best-selling private label categories in supermarkets, while tobacco and liquor were the least purchased. In terms of private label consumer packaged goods, the fastest growing products in 2021 included shelf-stable breakfast foods, lard, and other frozen foods. In terms of categories, the dollar share of non-edible products across all retail outlets was slightly higher than that of edible ones. However, when looking at the change in dollar sales between 2019 and 2021, edible private brands grew more than non-edible ones. Overall, national brands of both edible and non-edible products experienced a higher percentage change in dollar sales than their private label counterparts over the same period.Consumer trends
Changing buying habits due to the coronavirus pandemic (COVID-19), economic factors, as well as improvements in product quality and variety have contributed to changes in consumers attitudes toward private label brands. As shown by a recent survey, consumers have come to realize that, in terms of quality and value, these products are often as good, if not better, than the national brands they used to purchase, and the main reason they switched to a private label brand. The recent rise in inflation has also been a major factor that has prompted consumers to cut back on name brands and instead purchase private label products on a long list of products, particularly pantry items. The purchase of private brands has been quite similar across generations and income levels, indicating this as a general consumer trend.
