No longer just a cheaper non-brand option, stores are creating private labels that reflect their own mission and values and competing with national brands in terms of product quality and innovation.
Bold flavor is what can set the retailer’s line apart from national brands. Organic and natural lines will also continue to see growth with retailers looking for products that are unique and innovative in the better-for-you space.
Retailers have a unique advantage over national brands as both the manufacturers and sellers of their products, since they allocate shelf space and can feature their own products.
More than 50% said they buy more store brands today vs. last year and also describe themselves as frequent store brand shoppers. Millennials are a big driver for this explosion, as this generation has proven to show less brand loyalty than previous generations.
Private brands today comprise nearly $1.5 billion of sales in snack nuts with national brands accounting for $2.9 billion, according to market researcher Information Resources Inc. (IRI). Private label sales for snack nuts were up 18.3% in 2018, while sales of national brands were down 5%.
To see the massive potential for private label growth, consider how the U.S. compares to European markets in private label market share. U.S. has 16%, which is tiny compared to the 52% in the United Kingdom, 42% in Spain, 40% in the Netherlands and 38% in Germany.