Tomorrow's Private Label Consumers

DATAMONITOR VIEW 1
SUMMARY 1
METHODOLOGY 1
TABLE OF CONTENTS 2
Datamonitor View 1 2
SUMMARY 1 2
METHODOLOGY 1 2
TABLE OF CONTENTS 2 2
Analysis 4 2
TREND: Private label is growing rapidly across Europe and the US 4 2
TREND: Private label growth has been driven by food and drink sectors 7 2
TREND: Private label expansion has been fastest in the value channels 8 2
TREND: The focus of private label has evolved considerably 9 2
TREND: There has bene a development of private label tiered by value 9 2
INSIGHT: Private label shows distinct consumer group biases 10 2
INSIGHT: Private labels are not as trusted as famous brands 15 2
INSIGHT: Private label penetration varies by market 17 2
ACTIONS 20 2
Develop a brand architecture with tiered price points 20 2
Keep your brands fresh with new variants 23 2
Inject some fun into your brand-building 23 3
Develop specialist consumer-oriented lines 24 3
Ensure stand-out at point-of-sale 27 3
Communicate price differences 29 3
Improve store quality 30 3
APPENDIX 32 3
Definitions 32 3
Extended methodology 32 3
Ask the analyst 33 3
ANALYSIS 4
TREND: Private label is growing rapidly across Europe and the US 4
Private label sales have grown at more than twice the rate of branded food sales 5
The UK experience 6
European trends 6
TREND: Private label growth has been driven by food and drink sectors 7
TREND: Private label expansion has been fastest in the value channels 8
TREND: The focus of private label has evolved considerably 9
TREND: There has bene a development of private label tiered by value 9
INSIGHT: Private label shows distinct consumer group biases 10
Private label and household income 10
Private label and household size 12
There are important age differences in private label purchasing 12
The relationship between age and in-store decision-making 14
Gender differences in private label 14
INSIGHT: Private labels are not as trusted as famous brands 15
INSIGHT: Private label penetration varies by market 17
ACTIONS 20
Develop a brand architecture with tiered price points 20
Keep your brands fresh with new variants 23
Inject some fun into your brand-building 23
Develop specialist consumer-oriented lines 24
Use the online channel to improve knowledge of consumers 27
Ensure stand-out at point-of-sale 27
Communicate price differences 29
Improve store quality 30
APPENDIX 32
Definitions 32
Extended methodology 32
Ask the analyst 33

List of Tables

Table 1: Private label by country (US$m) Europe & US 2001-2011 5
Table 2: European private label by sector (US$m), 2001-2011 7
Table 3: US private label by sector (US$m), 2001-2011 8
Table 4: Presence of private label in different US grocery store formats (% value), 2001-06 8
Table 5: The development of private label, 1970s to 2000s 9
Table 6: European private label by market (US$m), 2001-2011 18
Table 7: US private label by market (US$m), 2001-2011 19
Table 8: Possible approaches to targeting men versus women in a private label versus famous brands situation 29

List of Figures

Figure 1: Bargain-hunting and trading-up attitudes and the purchasing of private label products (Europe & US consumers), 2005 11
Figure 2: Purchasing rate of private label by age group (Europe & US consumers), 2005 13
Figure 3: Agreement with the statement "I only make the choice between private labels and famous brands when in front of the store shelves" (US & European consumers) 2005 14
Figure 4: Expected price discount of private label to famous brands by drinks category, men versus women, (European & US consumers) 2005 15
Figure 5: Consumer beliefs about the claims of famous brands (European & US consumers) 2005 16
Figure 6: Beliefs about the claims and quality of private label (European & US consumers) 2005 17
Figure 7: Comparison of value, standard and premium private lines in UK supermarkets Tesco and Sainsbury's 21
Figure 8: Examples of US premium private labels, 2006 22
Figure 9: Charmin Basic - an example of a famous brand adopting the tiered pricing strategy of many private labels - and the possible private label response 22
Figure 10: Seasonal private label variants in the home hygiene and personal care markets 23
Figure 11: Examples of Trader Joe's quirky private label branding 24
Figure 12: Examples of expert private label lines, 2006 25
Figure 13: Examples of private label healthy eating lines, 2006 25
Figure 14: Examples of private label organic sub-brands in the US 26
Figure 15: Examples of private label children's lines, 2006 27
Figure 16: Examples of attention-grabbing private label packaging in Europe, 2006 28
Figure 17: Examples of distinctive private label packaging in Europe, 2006 29
Figure 18: Agreement with the statement "buying famous brands means I am paying for their advertising costs" (European and US consumers) 2005 30