Supermarket Perimeter - June 2024 - 30

Bakery
PRIVATE LABEL OFFERS OPPORTUNITIES to meet underserved needs
and to foster value beyond price.
Private label products have long been perceived as utilitarian and,
historically, trial of store brands increases during periods of economic
uncertainty. But over the last couple of years, these products have
found themselves on a trajectory beyond value - to accommodate
convenience, health and wellness, and the environment.
This has been an evolution from a basic label and simple packaging
to a sophisticated array of unique product offerings made specifically
for or even by the grocer as an extension of and representation of their
value, according to Doug Baker, vice president, industry relations, FMI -
The Food Industry Association.
" In a way, private brands are more than just a label, " he said. " They are
an extension of the retailers' brand and value proposition. "
As inflation-driven food prices continue to spike, private labels, which
can wax and wane with economic health, are helping consumers of
all demographics stretch their shrinking grocery dollars. FMI found
price (68%) and value (67%) as
the top reasons for buying more
private brand items, with ongoing
economic pressures finding
consumers seeking out deals.
Private Label Manufacturers Association (PLMA) study showed more
than half of Gen Z shoppers who participated in the survey said they
" always/frequently " choose a place to shop due to the store brands.
67% are " extremely/very " aware of store brands; 64% buy store brands
" always/frequently; " and 56% are " extremely likely/likely " to experiment
with store brands to find the " best value. "
As consumers continue to increase the number of stores they visit,
these private label products can help bring people in the door to shop.
FMI found 53% of all shoppers surveyed say a retailer's private brands are
" very " or " extremely important " in choosing to shop there. When used as
a way to surprise and delight, private label can be a draw for consumers
as witnessed by the number who choose to visit particular club stores
and supermarkets to specifically purchase its private label products.
" It's that stickiness by the consumer and the increased competition
Perimeter appeal
Although private label gained
share over the past three years, its
share is lower than it was prepandemic.
The perimeter bakery
department, which accounts for
more than 80% of bread and sweet
goods sales, is a haven for private label choices, according to Circana,
Chicago, where its products are viewed as premium and fresh.
" 86% of eating occasions are sourced from retail, " said Melissa
Altobelli, senior vice president, Client insights, Dairy and Bakery,
Circana, " With consumers continuing to be budget constrained, they
are looking for ways to have a restaurant-like experience at home, and
bread, buns and rolls in Perimeter can fill that need. "
Breads and rolls are up 7% in dollars and up .4% in units,
outperforming Center Store with additional Perimeter growth in
flatbreads, tortillas and naan. Although still a small segment, Altobelli
sees flatbread, tortillas and naan as an opportunity for further
penetration. Circana also found private label growth in baked goods
including brownies (+3%), cookies (+2.6%), whole pies (+5%), and multipack/assorted
donuts (+1.4%).
" Consumers are still wanting to treat themselves but also wanting
to meet budgetary constraints and avoid waste, " Altobelli said. " The
perimeter also offers pack size variety - an option for the needs of
different-sized households and budgets. Assorted packs allow for allfamily
appeal, offering a flavor everyone likes. "
Where to shop
This year, FMI found that while private label shoppers tended to skew
female, millennial or Gen Z and include households with kids, frequent
private brand shoppers are similar to the broader population. A 2024
30 - JUNE 2024
PRIVATE
LABEL
By Jennifer Barnett Fox
among retailers' own brands to capture store loyalty that's fueling the
continued growth, " said Peggy Davies, president, PLMA, New York.
Additionally, 90% of shoppers said they are " very likely " or " somewhat
likely " to continue to purchase
private brands if grocery prices
decrease - indicating shoppers
are defining value with private
brands beyond just price. FMI's
The Power of Private Brands
2023 report featuring information
from Circana found private brand
spending at Club Stores represents
21.7% of dollar share and 22.9% of
unit share.
" This is higher than any other
channel type with the grocery
channel coming in at 16.8% of private brand dollar share and 20.9% of
unit share, " Baker said. " I think the value proposition that private brands
offer has driven acceptance. "
Pushing visibility
This level of support and acceptance leaves private label manufacturers
with a unique opportunity to provide further product differentiation.
FMI is seeing the use of store brand packaging to meet consumer
demand for transparency and to communicate value beyond cost
savings. This includes how and where ingredients are sourced. FMI
research found 72% of shoppers say they would switch from a brand
they usually buy to a different brand that provides more in-depth
product information beyond what's provided on the physical label.
As a paper bag and paper film manufacturer, AFC Materials Group,
Lake in the Hills, Ill., recognizes the importance of brand loyalty
in the marketplace. The company collaborates with retailers and
supermarkets to design and manufacture packaging materials. This
includes collaborating with companies to improve and customize their
sustainability initiatives with offerings of certified recyclable packaging
designed to reduce environmental footprint.
" Supermarket brand loyalty has become a major factor in the
marketplace, and customers may prefer to buy private label product
if it's a supermarket brand they like, " said William Chander, packaging
outside customer success representative, AFC Materials Group.
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Supermarket Perimeter - June 2024

Table of Contents for the Digital Edition of Supermarket Perimeter - June 2024

Supermarket Perimeter - June 2024 - Intro
Supermarket Perimeter - June 2024 - FC1
Supermarket Perimeter - June 2024 - FC2
Supermarket Perimeter - June 2024 - 1
Supermarket Perimeter - June 2024 - 2
Supermarket Perimeter - June 2024 - 3
Supermarket Perimeter - June 2024 - 4
Supermarket Perimeter - June 2024 - 5
Supermarket Perimeter - June 2024 - 6
Supermarket Perimeter - June 2024 - 7
Supermarket Perimeter - June 2024 - 8
Supermarket Perimeter - June 2024 - 9
Supermarket Perimeter - June 2024 - 10
Supermarket Perimeter - June 2024 - 11
Supermarket Perimeter - June 2024 - 12
Supermarket Perimeter - June 2024 - 13
Supermarket Perimeter - June 2024 - 14
Supermarket Perimeter - June 2024 - 15
Supermarket Perimeter - June 2024 - 16
Supermarket Perimeter - June 2024 - 17
Supermarket Perimeter - June 2024 - 18
Supermarket Perimeter - June 2024 - 19
Supermarket Perimeter - June 2024 - 20
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Supermarket Perimeter - June 2024 - 30
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https://digital.supermarketperimeter.com/sosland/sp/2021_02_01
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https://digital.supermarketperimeter.com/sosland/sp/2020_01_01
https://digital.supermarketperimeter.com/sosland/sp/2019_12_01
https://digital.supermarketperimeter.com/sosland/sp/2019_11_01
https://digital.supermarketperimeter.com/sosland/sp/2019_10_01
https://digital.supermarketperimeter.com/sosland/sp/2019_09_01
https://digital.supermarketperimeter.com/sosland/sp/2019_08_01
https://digital.supermarketperimeter.com/sosland/sp/2019_07_01
https://digital.supermarketperimeter.com/sosland/sp/2019_06_01
https://digital.supermarketperimeter.com/sosland/sp/2019_05_01
https://digital.supermarketperimeter.com/sosland/sp/2019_04_01
https://digital.supermarketperimeter.com/sosland/sp/2019_03_01
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