Market Watch
PLMA Lauds Retailers with ‘Salute to Excellence’
By Lynne Cooke
Outstanding store brand products in food and drink and home and health were spotlighted
by the Private Label Manufacturers Association (PLMA) in its annual Salute to Excellence awards program.
Among the retail chains with multiple awards were A&P, Trader Joe’s Company, Winn-Dixie, Save-a-Lot, Price Chopper Supermarkets, Aldi, and Wakefern Food Corporation (full list is available at www.PLMA2010awards.com).
Nominations for the awards were made by retailers, wholesalers, manufacturers, brokers
and trade suppliers. Products were divided into Food & Drink Awards and Home & Health Awards and then subdivided by category of product, such as appetizers or over-the-counter (OTC) drugs. Products must have been introduced into the marketplace within the preceding
12 months.
Professional testing personnel prepared all products for evaluation by a judging panel. Products were reviewed for concept, packaging, value for money, and taste. Non-food products are judged on concept, innovation, presentation and value for money
All judging panels included consumers pre-screened for knowledge of store brands and past shopping experience. Judging and scoring was done on the same basis as professional panel members. Their views were intended to provide everyday insight and balance to the process.
Loblaw Tests Discount Brands
Loblaw is testing several discount store brands to lure more shoppers, as well as compete against well-entrenched national brands. These “fighter” brands, as some analysts call them, are much like the ones Tesco is using to compete with Wal-Mart’s store brand.
With such names as Bijou (frozen juice), Terra (canned vegetables), Cercle (mayonnaise) and Du Matin (jam), these products aim to look and compete like a name brand. For instance, a large jar of Cercle mayo is priced at $3.49 – more than the chain’s private-label No Name product at $2.59, but less than a smaller jar of Kraft Miracle Whip selling for $4.29.
PL Focus at Family Dollar
Discount chain Family Dollar is aiming to increase its store brand assortment with largely food and other consumables, according to reports.
The company sees an chance to increase consumable private-label sales from today’s levels of 10% of sales to 15% to 20%, according to Kenneth Smith, Family Dollar’s chief financial officer. Family Dollar also wants to serve shoppers with annual incomes above $40,000 better, he added.
FEBRUARY 2010
Sales Surge More than 10% to Set Market Share Record
By Jack Grant
And the beat goes on for store brands.
Sales of private label in major retail channels surged by more than 10% in 2008 to a record $83.3 billion. Supermarkets, drug chains and mass merchandisers combined sold a billion more private label units versus a year ago. Store brands accounted for 42% of the total gain in dollar volume coming into the three mainstream channels, according to data compiled by The Nielsen Company and published in the Private Label Manufacturers Association’s 2009
Private Label Yearbook.
In supermarkets, store brand sales soared by +9.4%, outdistancing national brands, which added only +1.4% in sales versus the year prior. Store brands were up $4.6 billion for a total of $53.8 billion in the channel. Private label dollar market share increased to 18.2% (from 17.1%) and set a new record. Private label also saw a +1.6% gain in unit volume, while national brands units declined -4.3%. As a result, private label unit market share advanced more than a full point to 22.3%, another all-time high.
In drug stores, dollar volume grew +14.4%, or nearly four times the rate of national brands, which were up +4.1%. As a result, store brand dollar market share climbed to a record 13.2%. Private label units meanwhile increased by +9.1%, and private label unit share rose to 15.2%, yet another high.
The solid gains in unit volumes, when measured against the results for national brands, indicates a real shift in shopping behavior, as consumers increasingly made the switch from national brands to purchase retailers’ brands instead. Clearly, the economy was a leading reason for the extraordinary growth in store brands. A recent series of polls conducted by
GfK for PLMA revealed that three out of American shoppers agreed that current economic conditions were important in their deciding whether to purchase supermarket or grocery
stores’ brands.
But the outstanding results at year-end can also be attributed in part to a strong foundation of consumer acceptance and patronage of private label products that predates the current economic situation. Supporting this view, fully 91% of shoppers in the GfK survey said they will continue buying store brand products after the recession ends.
The PLMA 2009 Private Label Yearbook is available to association members, retailers and wholesalers at no charge. It is also available to others by request at a cost of $1,500. To order a copy of the Yearbook, contact PLMA at (212) 972-3131.
