Magazine: Private labels are working hard to offer high quality

Private label products can now be found in basically all categories, from fresh and frozen foods to cosmetics and cleaning products. In Hungary the increase in real wages had a positive influence on shopper behaviour: buying frequency grew and demand increased for higher-quality and innovative products. Still, the popularity of private label products doesn’t seem to fade. Some shoppers almost exclusively buy these, but their main motivation isn’t low prices: what matters to them is the price-value ratio. For SPAR Hungary it is very important to popularise the consumption of healthy foods. Head of communications Márk Maczelka told our magazine: among the company’s wide range of private label products shoppers can find many which can contribute to a diverse and healthy diet.

_{Márk Maczelka
head of communications
SPAR Magyarország}

For Lidl Hungary private label products have special significance, as their price-value ratio perfectly represents the company’s philosophy – Quality, freshness, price and health. The majority of products sold on Lidl stores are top-quality private label FMCG products. One of the keys to ALDI’s success is high-quality private label products, which make up for 80 percent of the product selection. ALDI’s experience is that in the last few years shoppers go to know and like these products, which offer the same quality as branded products. With continuous innovation work the company wishes to satisfy new consumer needs, e.g. the growing demand for lactose- and gluten-free, and organic products.

In general we can say that much more organic food products are available in the private label categories than before. In the drugstore channel natural, organic and eco dm brands have played a pioneering role in many categories in the Hungarian market. Roland Kanyó, dm Kft.’s marketing and PR manager told our magazine that the cumulative volume share of dm brands (e.g. profissimo, dmBio, etc.) is 40 percent and their value share is 29.9 percent, while their growth rate is more than 15 percent! Nelli Kadlok, PR manager of Rossmann Magyarország informed us that they also offer private label products in nearly every category – and these are more and more popular among consumers.

_{Roland Kanyó
marketing and PR manager
dm}

_{Nelli Kadlok
PR manager
Rossmann}

When innovating in the private label product category, SPAR works taking the latest consumer needs into consideration. Demand for products that satisfy special needs such as the SPAR free from, SPAR Vital and SPAR Veggie product ranges, and the SPAR Natur* organic product line is on the rise, and SPAR keeps updating these ranges. What is more, this September SPAR Hungary added the products of German manufacturer Veganz to the portfolio – these groceries are exclusively made from plant-derived ingredients.

The latest result of ALDI’s innovation work is the completion of the award-winning, first-price category Kokárdás product range. They also launched several new private label products in the baked goods category. Each year Lidl expands its private label product portfolio, with their eyes set on the latest consumption trends. This year the company launched Esmara by Heidi Klum, a new fashion collection for women designed by supermodel Heidi Klum. It is needless to say that dm also monitors the latest trends and the drugstore chain’s own products have the same quality as any other branded product. What is more, they keep renewing in terms of both product ingredients and packaging design. Rossmann’s primary objective is to update its product selection and to come out with private label products in new segments. Consumers like the drugstore chain’s seasonal and limited edition private label products very much. //