Consumers view private label as a good alternative

by Staff
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SCHAUMBURG, ILL. — Seventy-two per cent of U.S. consumers believe private label products or store brands are good alternatives to name brands, according to a new survey by The Nielsen Company. In addition, 62% of consumers believe store brands are as good as name brands.

"While private label products continue to follow the success of consumer packaged goods manufacturers’ name brand introductions, more CPG retailers are making private label a priority with messages on quality as strong as messages on value," said Todd Hale, senior vice-president of consumer and shopper insights for Nielsen.

In fact, consumers’ positive attitude toward private label products is likely driven by an improved sense of quality as 63% of consumers believe private label brand quality is as good as name brands, and 33% of consumers say they consider some store brands to have higher quality than name brands. However, 16% of consumers did say store brands are not suitable when quality matters.

Overall, consumers believe it is important to get the best price on a product with 67% of consumers saying store brands usually provide "extremely good value" for the money while 35% of consumers are willing to pay the same or more for store brands if they like it. Only 24% of consumers said name brand products are worth the extra price.

Nielsen said it first appeared that recent private label sales dollars were being driven by rising commodity and food prices, but a recent upward trend in private label unit sales suggests budget-friendly consumers are starting to shift away from established brands in search of better deals.

"Private label development varies greatly by department, and we see strongest growth in products where private label has historically been strong," Mr. Hale said. "Translating private label growth outside of commodity categories requires innovation — an area where CPG manufacturers, rather than retailers, traditionally excel."

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