Not a zero-sum game: Private Label Ads Vary by Category

How's private label trending? Depends on what category you examine. The average food category has seen a 5 percent increase in private label feature ad share compared to 2015. But in select, highly promoted categories such as chicken, cream and sour cream, private label ad share has grown by more than 30 percent this year.

Behind the numbers: Increased cross-channel competition for consumer attention certainly plays a role in this trend, especially in trip-driving categories such as meat and dairy. A recent survey of 1,000 primary household shoppers suggests that while shoppers are looking for low prices, some have some concerns around quality and are more likely to maintain loyalty to their favorite brands. While 81 percent of respondents say they regularly buy private label, nearly 40 percent of respondents indicated that they don't think private label products are of the same quality as national brands. This would indicate that it is largely category-specific, and retailers' promotional focus reflects their recognition of what drives traffic and where people are looking to save.

Private label buyers: There is variability by age group as well. The survey shows that older demographics gravitate to private label more. 88 percent of those age 60 and over said they buy private label, compared to only 74 percent of 21-29 year olds. Women also reported more private label buying, 84 percent compared to 78 percent of men.

Price-conscious: Shoppers like to save money. So it's no surprise that price is one of the primary drivers for purchasing private label brands, with 74 percent of consumers reporting they will purchase private label if it is cheaper than national brands. Further to that point, when asked about the biggest influencing factor when choosing what brands to buy, the most common response (40 percent) was whether or not the brand is on sale or discounted. Shoppers have been conditioned to look for deals and, in the absence of a incentive to buy national brands in the form of sales, they often choose private label as an alternative. In order to maximize opportunity for shopper attention, it's important to understand what the landscape looks like from a competitive standpoint not just among your national brand competitors, but also in store brands and private label.

Private label ad share growth by category
Print feature ads (YTD 2015 vs. 2016)

Do you think private label/store brand products are of the same quality as national brands?

If a private label brand is less expensive than the national brand, will you purchase private label?