Channels / Grocery
Doug's Drift

Private Label's Competitive Edge

March 14, 2013

Sales of private-label products have skyrocketed over the past several years. In the food sector — the focus of my trade-publishing passion over the last two decades — U.S. private-label market penetration is approaching 20 percent and is on track to continue increasing its share up to 30 percent over the next decade according to some reports, often outcompeting national brands in terms of growth.

Clearly, today’s private-label products ably challenge leading national brands in terms of overall appeal and quality — and repeat purchase.

This hasn’t always been the case. I’ve been around long enough to remember the bare-bones products stocked in the “generic” aisles of grocery stores — products with neither widespread appeal nor high quality. And, at the time, that comprised the full scope of private label.

While such no-frills staples still have a viable spot in our diverse retailing environment, they’re now accompanied by a full spectrum of choices appealing to far-reaching demographics. As someone with a strong culinary background — and “natural” and organic tendencies — in the early days of this industry, I never would have considered private label as worthy of a spot in my grocery cart. Today, my cart is regularly filled with private-label products: organic milk and juices, cage-free eggs, frozen organic vegetables, high-culinary frozen pizzas and appetizers, bakery-quality refrigerated cinnamon rolls, and more.

These private-label products increasingly command — and receive — a premium. And competing with national brands at this level can increase profit margins. But maintaining, and deepening, this edge requires assiduously following segment trends. In many areas of food, for instance, this means tracking restaurant concepts trickling into retail, forward-trending flavor pairings and ingredients, and ethnic assimilation, among other factors. Similar attention to quality and prevailing trends applies to all segments of retail.

Such trend-tracking and overall private-label business awareness forms the core of our work here at PLBuyer — from the printed word to our online capabilities, like the ever-evolving PLB Superstore, and our live event, PLB 360, taking place June 11-13 in my hometown of Chicago. Maintaining your competitive edge requires ever-vigilant analysis of this fast-growing industry. To that end, I encourage you to contact me and initiate conversations on your prevailing challenges, as well as your success stories. Together, we can drive private label to an unforeseen level of success. 

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