- RESEARCH & AWARDS
- CATEGORY REVIEWS
PLMA anticipates that its 2013 Private Label Trade Show will be its biggest yet, presenting more than 2,300 exhibit booths—surpassing last year’s record-breaking expo—across four halls at the Donald E. Stephens Convention Center in Rosemont, Ill., taking place from November 17–19. It’s expected that over 4,500 individuals from retailers and the supply chain will attend this industry-hallmark event.
The private label industry continues to make significant gains. According to recent data from The Nielsen Company, total private label sales in the United States last year reached $108.3 billion, with store brand growth continuing to outpace national brands. Across all outlets, private label products contributed $3.1 billion in incremental sales last year alone. Since 2009, annual growth of store brand sales has averaged 4.9 percent compared to national brand annual growth of 2.1 percent.
Other new statistical findings from Nielsen include:
• Private label unit market share in supermarkets has reached 23.1 percent, and dollar market share is now 19.1 percent
• Since 2009, sales in the supermarket channel have increased at an annual rate of 2.6 percent compared to an annual average gain of 0.9 percent for national brands
• The drug store channel is hot—during 2012, store brand sales gained 5.5 percent, hitting a total of $8 billion
• Store brand sales in drug stores have grown at an annual rate 6.9 percent since 2009, while annual gains for national brands in the channel have averaged 1.6 percent
Store brand dollar share in the drug store channel rose to 15.9 percent, while unit share improved to 16.6 percent, both record levels.
Select aspects of store branded products, touching on several retail channels—including drug stores, convenience and grocery—are on the rise. Brian Sharoff, president of PLMA, noted that there’s “greater interest than ever before” from manufacturers of prepared and convenience foods, as well as microwaveable products. At the show this year, he noted, “our staff is estimating that well over 60 percent of our food exhibitors are now in those categories.”
This attention comes at a time when store-branded prepared foods and foodservice activity, in tandem with expanded retailer deli departments, has driven significant growth.
“Obviously, the retailers must be making a bigger effort than ever before in terms of microwavables, ready-to-eat, ready-to-serve, so that would be one of the things to look for on the show floor, more of those kinds of companies,” said Sharoff.
“On the non-food side, I think what the show is giving us at the moment is more diversity of private label products,” said Sharoff. “It’s not just analgesics, hair conditioners and shampoos… We’re seeing more of the medical-type of things, diabetes tests, things that are related to health-and-wellness as compared to good looks.”
Amidst these trends, exhibiting companies will offer up tens of thousands of products across virtually every food and beverage category—spanning shelf-stable, refrigerated and frozen sections—and encompassing everyday, gourmet and specialty needs. On the non-food side, exhibitors will feature everything from health and beauty care to over-the-counter pharmaceuticals, vitamins and nutritional supplements, household products, kitchen and cleaning products, DIY, and general merchandise.
And the rest of the world is taking note. “The third thing we’re seeing that the show is reflecting, is more interest than in past years by international suppliers,” said Sharoff.
In the old days of the show, the international contingency of suppliers was basically from Canada. This year, the international presence includes France, Italy, Peru and Mexico. Sharoff said they’re even expecting a pavilion from Egypt and South Africa this year.
“These are companies that are going to be competing in the same kinds of product ranges that are in the show—and private label in the United States,” said Sharoff. These are new sources of potentially diversified supply.
Pet Care Spotlight
Pet products are proving a profitable sector for private label growth, as consumer spending on these categories continues to climb. The American Pet Products Association (APPA) has suggested that the U.S. pet owners will spend $55.53 billion on their pets in 2013, representing a gain of nearly 10 percent over the past two years alone. Of that amount, $33.29 is projected for food, supplies and OTC medicine—all areas where private label can compete.
We’re doing more on pets this year at the show, noted Sharoff. “Last year, the reaction to pets was extremely good. We know that private label market share is a very strange thing on the pet side. On the one hand, you have Walmart, who has the leading national brand of dog food, and at the same time you have a private label market share that is much smaller in a lot of the other categories, cat foods and such.” That lower degree of penetration in some categories opens a clear path to opportunity.
On Sunday afternoon, PLMA will hold a special pet care product seminar featuring a panel of industry experts that includes David Lummis, senior pet market analyst for Packaged Facts; Serge Boutet, owner of SB Nutrinnov Consultants; and David Murray of Kent Nutrition Group. The Pet Care Pavilion will also be back for a second year, this time with an expanded emphasis on pet care.
“In the U.S. pet products market, private label penetration varies dramatically by channel and category, from apparent saturation in some areas to striking underrepresentation in others,” said Lummis. “Overall, opportunities abound as retailers seek to differentiate and cement customer loyalty in this diverse and seemingly recession-resistant market.”
Lummis noted that Sunday’s seminar will help illuminate the nuanced pet products market. “This cross-channel discussion will spotlight recent activity across a diverse range of mass and specialty channels, pinpointing hits, misses and major opportunities for additional private label development,” he said.
Pets are more popular than ever amid a convergence of lifestyle trends—from more single men and seniors living alone to new urban dwellers choosing smaller pet breeds and species, and young couples who choose to put off starting a family and become “pet parents” instead.
“People tend to be surrounded more and more by pets, and within the past years, especially for dogs and cats, we do not talk about ‘pet owning’ anymore, we now talk about ‘pet parenting,’” said Boutet. “The nutrition, and consequently the health, of domestic pets has undergone vast improvement over the decades. Pets are family members, and taking care of family means providing the best we can to each and every one… This deep and profound humanization change has had a big influence not only on the pet food and accessories retail market, but also on the private labeling business.”
While pet product categories tend to be dominated by national brands, PLMA believes the segment is ripe for private label development. Retailers across multiple channels—from pet specialty chains to supermarkets, drug chains and mass merchandisers—are starting to take note of the trends in the pet care space and look to build loyalty among pet owners through their own store brands.
“Retail stores are now filled with products and accessories coming directly from the human world,” said Boutet. “This focus of humanized mix of services, products, nutrition and health care is a main factor affecting the retailers’ private labeling business today.”
This “humanized” aspect of pet care brings premium product potential to the fore. “The pet care industry is complex, and truly a world market,” said Boutet. “This growing market has become even more competitive by the emergence of private label and controlled brands from all over the world. These brands were originally designed as low-end, but consumers’ demand for high-end products has directed the way to high-quality pet care products and the super-premium pet foods segment.”
PLMA’s Idea Supermarket offers an unparalleled opportunity to see store brand products and packaging firsthand, selected from more than 50 leading retailers across North America, Europe, Asia and Latin America. This product showcase is a perennial hot attraction at PLMA shows.
Store brands from the following retailers and companies were profiled in the Idea Supermarket at the PLMA’s “World of Private Label” International Trade Show in Amsterdam earlier this year (PLMA members can access all product details on www.plmaideasupermarket.com):
• Belgium—Colruyt, Delhaize
• Canada—Rexall, T&T Supermarket, Walmart Canada
• Czech Republic—Albert, Billa, Coop
• France—Intermarché, Marionnaud, Picard
• Germany—Edeka, Lidl, Norma, Penny Markt, Real, Rewe
• Italy—Coop Italia, Despar
• The Netherlands—Hema, Spar, Superunie
• Portugal—Pingo Doce
• Sweden—Axfood, ICA
• Switzerland—Coop Switzerland, Migros
• United Kingdom—ALDI UK, Asda, Harrods, Marks & Spencer, Morrisons, Sainsbury’s, Tesco, Waitrose
• United States—Bath & Body Works, Kohl’s, Safeway, Sephora, Target, Topco, Walgreens, Walmart
The products featured at the show in Rosemont will have a decidedly more-domestic focus. Last year, the Idea Supermarket at the U.S. show included:
• France—Carrefour, Leader Price
• The Netherlands—Hema
• South Korea—GS Retail
• Sweden—Axfood (Sweden)
• United Kingdom—Harrods, Morrisons, Tesco, Waitrose
• United States—7-Eleven, Ahold USA, ALDI U.S., Associated Wholesale Grocers, Babies “R” Us, Bath & Body Works, BJ’s Wholesale Club, Costco Wholesale Corporation, CVS/pharmacy, Delhaize U.S., Dollar Tree, Fresh & Easy Neighborhood Markets, H-E-B, Kohl’s, Kroger, Navarro Discount Pharmacies, Petco, PetSmart, Price Chopper/Golub Corporation, Publix Super Markets, Rite Aid Corporation, Safeway Inc., SuperValu, Target, Topco, Trader Joe’s, Wakefern Food Corporation, Walgreens, Walmart, Wegmans, Whole Foods Market, Williams-Sonoma, Winn-Dixie
PLMA will also include its New Product Expo within the Idea Supermarket, showcasing hundreds more new products from exhibitors on the trade show floor. Additionally, all of PLMA’s 2013 Salute to Excellence winning products will be promoted inside the Idea Supermarket (and can also be viewed online at www.plmawinners.com).
A Salute to Excellence
PLMA announced the winners of its annual Salute to Excellence Awards after two intensive days of tasting and evaluations by eight jury panels made up of industry experts and consumers. Nominations this year exceeded 500 new products, the most received in a single year, according to PLMA. To qualify, products must have been introduced within one year of their submission by the retailer. Every food and beverage product considered by the judges was scored on appearance, organoleptic aspects (like taste, texture and aroma), packaging and presentation, and value. Home and health products were judged on product concept, packaging and presentation, and value.
Once all was said and done, 50 products from 32 retailers had been tapped for top honors for 2013.
Food and beverage products earning the highest overall scores included Costco’s Kirkland Signature Sweet Mesquite Seasoning, BJ’s Wholesale Club’s Earth’s Pride Black Forest Blend Trail Mix, and Giant Eagle’s Market District Tuscan Style Kale Salad Mix. Products scoring the most points in home and health were Safeway’s Bright Green Cool Breeze with Bleach Alternative Laundry Detergent, TopCare Premium Blood Glucose Monitor from Topco, and BJ’s Wholesale Club’s Living Home 13 Piece Cookware Set.
In addition, the balloting revealed some broad trends among store brands. For instance, multicultural aspects continue to migrate into the mainstream. Primary ethnic influences come from Asia and Latin America. Winning Asian-inspired products included Trader Joe’s Sriracha Sauce; Target Archer Farms Garlic, Ginger & Sriracha Cream Cheese Wontons; and Whole Foods Market Potato & Pea Samosas. Ethnic flavor profiles are also no longer confined to ethnic or specialty items, with penetration seen into conventional snacks, salad dressings and soups. Latin American flavors were seen in several winning entries: Kroger’s Wholesome@Home Cheesy Chicken Enchilada Soup, Safeway’s The Snack Artist Yellow Corn Tortilla Chips, Western Family’s Natural Directions Organic Blue Corn Chips with Flax Seeds, Brookshire’s Authentic Picante Sauce, Northgate Gonzalez Market’s Jalapeño Ranch Dressing, and Navarro’s Vida Mia Café Espresso.
Sweet indulgence was another big winner, with awards going to Save-A-Lot’s Ginger Evans New York Style Cheesecake, Walgreens’ Good & Delish Dark & Twisted Chocolate with Lemon & Black Pepper, Kroger’s Private Selection Dark Chocolate Petit Beurre Biscuits, Winn-Dixie’s Prestige Raspberry Cone Crunch Ice Cream, Price Chopper’s Central Market Classics Mini Biscotti with Chocolate, and Metro Richelieu’s Irresistibles Triple Chocolate Pyramid Cake.
Beauty wins included Sephora & Pantone Universe’s Colorbyte Lip Wands, Costco’s Kirkland Signature Daily Facial Towelettes, Victoria’s Secret’s Beach Wave Hair Spray, Rite Aid’s Renewal for Men Hair & Body Wash, and Ahold’s CareOne Hair Regrowth Treatment for Men.
Once again, PLMA’s Executive Education Program will be presented on Saturday and Sunday, Nov. 16-17, with classes and workshops that have been created specifically for the private label industry in conjunction with St. Joseph’s University, Philadelphia (This program requires separate registration from the trade show registration).
“One thing that we’re doing at the show this year that we didn’t do last year is we’re going to be spotlighting the new ‘Ask PLMA’ website (www.askplma.com) that we inaugurated last year,” said Sharoff. PLMA will place emphasis on the website at the show, with a video explaining the concept.
Also, the Sky Hall will return this year. This hall has grown to over 500 stands just one year after its launch, according to Sharoff.
Finally, as in past years, PLMA Live! coverage will be available to anyone who can’t make the show.
Looking forward to 2014, the PLMA ”World of Private Label” International Trade Show will present more than 3,800 exhibit stands including 50 national and regional pavilions, held at the RAI Exhibition Centre, Amsterdam, the Netherlands, on May 20–21, 2014. To exhibit or register to attend, contact the PLMA International Council at (31) 20 5753032 or email@example.com.