Acosta’s2018 Why Brands Matter reporttakes an in-depth look at the value and current state of national and private label brands, highlights of which include:
Why Brands Matter
While there are a variety of reasons shoppers may choose a private label brand, cost savings is the primary driver. Further, while many shoppers view purchasing private label brands (or store brands) as a compromise, shoppers overall view national brands to be superior to their private label brand counterparts in most categories. For instance:
Shopping trips driven by national brand purchases are more valuable than private label brand trips on average by 65%.
The top three reasons shoppers said they purchased national brand products while grocery shopping were:
Not All Categories Are Created Equal
Generally, the more personal, innovative and differentiated the category, the more likely a shopper will choose a national brand over a private label brand. Several of the categories for which shoppers indicated they purchased national brands “exclusively” or “mostly” are personal care products used on or applied to the body. Further, nearly all of the categories for which shoppers reported “exclusively” or “mostly” selecting private label brands tend to contain staple items that are consumed.
The Value Channel Is Growing
“To craft the best possible brand strategy, use research and analysis to help strike the right balance with national and private label brands in each department and category,” Clevenger said. “A clear takeaway for retailers is that they should understand the different roles national and private brands play. Manufacturers should concentrate on telling a compelling brand story and selling their expertise and understanding to build a brand connection with shoppers.