Opportunities in Private Label

The Private Label Manufacturers Association (PLMA) 2012 Private Label Trade Show is just winding down here in Chicago. This year’s show was a major endeavor, with more than 2,000 exhibitors representing a mind-boggling assortment of food, beverage, wellness and home goods products. From high-end chocolates to pork rinds ... even organics, one in four products purchased today are store brands—a category growing twice as fast as national brands.

So, what drives the consumer to buy private label? While the private label industry shed the “cheap bland generic" image long ago, store brands are still a bargain. Without the heavy spending on advertising and promotion, store brands won big during the last recession.

A 2011 Mintel study found that nearly half of respondents believe store branded products are of better quality today than they were five years ago. And over 60 percent of shoppers believe there’s no real difference between name brand and private label in the key categories of dairy, canned and shelf-stable products.

What impressed me most about the products on display at the PLMA show is the move toward higher quality, more innovative products that store brands are seeking. Many retailers have invested in their own brand reputation that impacts the perception of the items that carry their name ... often, products with enhanced health and wellness attributes as differentiators. Trust your retailer, trust their brand. Trader Joe’s has made a fortune on that philosophy.

What store branded “labels" or products do you buy?