Store Brands Are Accelerating, Evolving: Report
The private label sector has been on a very public roll, as store brand products continue to garner attention and capture more sales based on quality, variety and innovation. Recent research confirms the popularity of private label products and reveals some key trends.
According to a report from Chicago-based insights firm Circana, LLC, unit shares of store brand products in the United States hit 24% last year as budget-minded consumers continued to be driven by a quest for quality and value. Underscoring the staying power of the movement, growth continued even as inflation rates came down from previous historic highs.
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Circana’s report, "From Growth to Transformation: The U.S. Private Label Story," affirms that food and beverage segments are leading expansions in this country, with a 0.6% lift in dollar share from 2023 to 2024. The research also shows that store brands resonate among a broad swath of shoppers, including consumers from all demographic groups and those who cross-shop at multiple store formats. Younger consumers, in particular, are interested in exploring new private label items that meet their expectations for taste and price.
Sally Lyons Wyatt, global EVP and chief advisor at Circana, said that the category is evolving as it is expanding. “Private label will continue its growth trajectory, but the next wave of growth may come from different places,” she observed. “While value channels have recently driven private label gains, expect more grocers – both large and mid-sized – to invest more aggressively, making private labels a core growth strategy. Retailers will continue to tier their offerings with more margin-accretive premium products, while also leaning in on entry price-point products. As retailers continue to build brand equity, they may rethink pricing and promotion strategies, but innovation – including with new products, localization, regionalization or unique partnerships – will continue to take center stage.”
In addition to the deep dive on the U.S. private label market, Circana released research on store brand trends on the global stage. That report, "From Growth to Transformation: A Global Private Label Perspective," shows that competition in the private label arena is increasing worldwide, especially in France and Spain. According to the findings, retailers and manufacturers are adopting different growth strategies to maintain or improve their market share, including increasing product portfolios and distribution.
