MoreNot only is the private label movement here to stay, it is spreading to additional product categories, the latest consumer research from the Private Label Manufacturers Association (PLMA) indicates. But success means private label goods makers need to ramp up innovation and not fall prey to simply imitating their large competitors, says Brian Sharoff, PLMA’s president..
Not only is the private label movement here to stay, it is spreading to additional product categories, the latest consumer research from the Private Label Manufacturers Association (PLMA) indicates. But success means private label goods makers need to ramp up innovation and not fall prey to simply imitating their large competitors, says Brian Sharoff, PLMA’s president..
PLMA’s recent nationwide poll finds 63 percent of main household grocery shoppers interviewed say the “Great Recession” irrevocably changed their food-buying habits. Eight in ten respondents say they will buy more store brand products in categories where they previously bought national brands.
“People are spending less time and money in restaurants and fast food,” Sharoff tells PL Buyer’s eReport. “That suggests store brands for chilled, frozen and ready-to-serve meals should grow. Ingredients, found in the center store, are likely to grow, because people will be preparing more meals at home.”
In fact, the study found 91 percent of shoppers cut back on money spent on restaurants, fast food and takeout; nearly nine of ten shoppers keep shopping lists and avoid buying on impulse; and 81 percent of respondents reduced purchasing more expensive items such as fish, meat and convenience products.
The next step for PLMA members “is to keep the pressure on to create innovative, differentiating products, and not to fall into the trap of simply imitating national brands in a given category. With the market growing, it’s time to be innovative, not imitative,” Sharoff says.
Results of the nationwide poll of main household grocery shoppers, conducted by GfK Custom Research North America, are found in PLMA’s report, ‘Store Brands & the Economy: Are Shoppers Ready to Start Spending Again?’ About one of every five shoppers surveyed reports economic conditions are better. In a similar poll in February, just 17 percent saw any improvement. The gain is especially evident among those earning at least $75,000, where 27 percent say the economy is improved. Meanwhile, 41 percent say conditions are the same and 36 percent think things are worse.
“The survey shows that people with incomes above $75,000 are more confident about the economy and more willing to spend,” Sharoff says. “But, keep in mind, store brands are now purchased across all income levels.”
Sharoff sees the recession’s psychological impact as being as tangible as its actual economic toll. But even so, “It has forced retailers to look closely at what is on their shelves, and undermined loyalty to national brands that people were willing to pay a premium for. It really has set the stage for the growth of store brands,” he concludes.
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