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Bright Future for Store Brands Post-Recession

June 15, 2009
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 In a poll conducted earlier this month by New York-based GfK Custom Research North America for the Private Label Manufacturers Association (PLMA), 91 percent of the approximately 800 respondents - identified as primary supermarket shoppers - said they would continue to buy store brands post-recession. In contrast, only 8 percent of the shoppers polled said they will stop buying such products once the economy improves.

According to the New York-based PLMA, nine out of 10 of the polled shoppers also agreed that the store brand items they buy are just as good as, or better than, national brand products. In addition, more than three out of 10 respondents said they now are buying more store brand items than they were a year ago, and almost half of the respondents said they wanted their supermarket to carry a greater assortment of private label products.

The poll also found that the recession still is having a significant impact on shopper behavior, with 54 percent of respondents indicating the recession is an “important” factor in their decision-making, and 32 percent indicating it is a “very important” factor. And 35 percent of respondents said they are trying store brand products in categories in which they purchased only national brand items pre-recession.

“We had looked at prior recessions in 1991 and 2001, and in both cases, private label share went up during the recession and then went up even more after the recession,” Brian Sharoff, PLMA president, told PL Buyer. “So with that in mind, we wanted to see what attitudes are out there now. And the 91 percent suggests that when this recession is over, those people who have tried private label for the first time will stay private label shoppers, and private label share will grow beyond its current share once the recession is over.”

Key to keeping this newfound private label business will be an emphasis on product quality, he added.

“Anything that manufacturers and retailers can do to maintain high quality” will go a long way toward growing private label “after recessionary pressures are over,” Sharoff said.

The survey is part of PLMA’s ongoing “Store Brands and the Recession” study. The latest research in this study was co-sponsored by Fort Worth, Texas-based Marketing Management Inc., a sales and marketing company that specializes in store brands. - K. Canning

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