Gap between private label, national brands narrowing

Gap between private label, national brands narrowing

  • 17.03.2025 00:00
  • bakingbusiness.com
  • Keywords: AI, Startup

Private label brands are growing in popularity, with consumers viewing them as equal or better than national brands. Retailers like Walmart and Costco are expanding their private labels to compete, driven by demand for value and quality.

Amazon Reports
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Estimated market influence

Circana

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Analyst rating: N/A

Contributed data and insights on private label trends.

PMLA

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Analyst rating: N/A

Reported industry revenue for store brands.

Context

Analysis of Private Label vs National Brands Market Dynamics

Key Facts and Data Points

  • Private Label Revenue: $271 billion in 2024 (up 3.9% YoY).
  • National Brand Growth: 1% YoY increase in dollar sales.
  • Consumer Perception: 69% of consumers view private label as similar or superior to national brands.
  • Growth Drivers: Price, quality, and availability.

Market Trends

  • Narrowing Gap: Private labels are gaining traction in traditionally strong national brand categories like chocolate candy, sports drinks, carbonated soft drinks, and salty snacks.
  • Salty Snacks Share: Private label接近10%的市场份额。
  • Retailer Focus: Major retailers (e.g., Walmart, Target, Kroger) are investing heavily in private labels with initiatives like Walmart’s Bettergoods and Kroger’s Our Brands.

Competitive Dynamics

  • Retailer Investments: Retailers added over 900 new private label products in 2024.
  • Kroger Performance: Kroger’s Our Brands surpassed national brands in Q4 sales, particularly in premium categories.
  • Collaboration: Retailers are partnering with national brands to enhance margins and promote co-branded products.

Strategic Considerations

  • Premiumization and Innovation: Future growth for private labels will rely on higher quality and differentiation.
  • Promotions and Differentiation: Retailers are focusing on promotions, clearance items, and unique offerings to attract consumers.
  • Global Expansion: Private label trends are gaining traction globally, with regional grocers expected to follow suit.

Long-Term Effects

  • Market Share Shift: National brands face increasing competition as private labels gain credibility and market share.
  • Retailer Survival: Retailers must innovate and collaborate to maintain profitability in a competitive landscape.
  • Consumer Impact: Consumers benefit from increased variety, quality, and price options.

Regulatory Impacts (if relevant)

  • No significant regulatory changes mentioned in the text.

This analysis highlights the growing influence of private labels in the market, driven by consumer preference shifts, retailer investments, and strategic collaborations. The long-term implications suggest continued pressure on national brands to adapt and compete effectively.