Private labels are enjoying unprecedented popularity

By: Tisza Andrea Date: 2024. 10. 09. 10:48

According to EY’s latest Future Consumer Index, inflationary pressure and the cost-of-living crisis have had a significant impact on consumer preference for private label products.

This article is available for reading in Trade magazin 2024/10

While earlier 28% of consumers said they were buying more private label products rather than branded ones because of rising costs, this now appears to be a lasting habit, as 66% of respondents said that these cheaper alternatives meet their needs as well as branded products. No wonder that 38% don’t plan to switch back to branded items.

Record profits in the US

Sales of private label products reached an all-time high in terms of both units and dollars in the first half of 2024 in the United States, according to data from Circana’s survey conducted exclusively for PLMA. Private labels’ market share was 22.9% in volume and 20.4% in value on 16 June. Total private label sales in the first six months reached USD 121bn, while sales of big nationwide brands totalled at USD 472bn.

Spaniards are also saving money by buying private labels

The situation is no different on the old continent: in Europe inflation is an important driver of private label growth, too. New research from DIA shows that in Spain, for example, six out of ten shoppers are trying to save money by buying more private label products, with savings of up to 10-25% per month. Retailers are doing whatever they can to meet consumer needs. For instance Migros in Switzerland is expanding its private label selection and offering lower prices, in order to reposition the company. //