Private Label Foods - US

Published by: Mintel International Group Ltd.

Published: Feb. 1, 2008 - 81 Pages

Table of Contents

Scope and Themes

What you need to know

Definition

Data sources

Sales data

Consumer survey data

Abbreviations and terms

Abbreviations

Terms

Executive Summary

The bottom line

Making gains in some segments, losing in others

Supermarkets find competition from other channels is increasing

Demographic factors that impact private label sales

More than half of respondents to Mintel’s research are their household’s primary shoppers

Buying store brands

Attitudes and opinions about store brands and national brands

Market Size and Forecast

Key points

Market size remains steady

Commodity-type products command greatest share of store-brand sales

Figure 1: Total U.S. sales and forecast of private label food (nine segments), at current prices, 2002-11

Figure 2: Total U.S. sales and forecast of private label food (nine segments), at inflation-adjusted prices, 2002-11

Figure 3: Total U.S. sales of total food in nine selected categories, in current and constant prices, 2002-07

Competitive Context

Key findings

Private label accounts for about a quarter of total sales

Figure 4: Total sales and total private label sales, 2002-07

Competition with national brands

More convincing showing in “commodity” segments

Figure 5: “Commodity” segment sales of private label foods, FDMx, 2006 and 2007

Competing in more challenging segments

Private label product launches increase significantly in 2007

Figure 6: New product launches, private label food and beverages, 2002-07

Segment Performance

Key points

Overall growth up 7% over two years

Figure 7: U.S. sales of private label food, by segment, 2005 and 2007

Segment Performance—Milk

Key points

Milk is top private label category

To remain competitive, private label expands to organic and specialty products

Figure 8: U.S. sales and forecast of private label milk, 2002-12

Figure 9: Total sales and total private label sales, milk, 2002-07

Segment Performance—Dairy (Excluding Milk)

Key points

Eggs are biggest private label product

Private label natural cheese sells better than processed products

Price increases in dairy help store brands grow

Figure 10: U.S. sales and forecast of private label dairy (excluding milk), 2002-12

Figure 11: Total sales and total private label sales, dairy (excluding milk), 2002-07

Segment Performance—Bread and Cereal

Key points

Private label bread is big seller

Cereal lags behind as branded products remain strong

Figure 12: U.S. sales and forecast of private label bread and cereal, 2002-12

Figure 13: Total sales and total private label sales, bread and cereal, 2002-07

Segment Performance—Sweet Goods

Key points

Like other bakery products, sweet goods have strong private label identity…

…but in ice cream, branded products still carry weight

Figure 14: U.S. sales and forecast of private label sweet goods, 2002-12

Figure 15: Total sales and total private label sales, sweet goods, 2002-07

Segment Performance—Vegetables

Key points

Plain vegetables have strong private label showing

Store-brand innovation weak in the segment

Figure 16: U.S. sales and forecast of private label vegetables, 2002-12

Figure 17: Total sales and total private label sales, vegetables, 2002-07

Segment Performance—Refrigerated Entrées and Frozen Seafood

Key points

Private label sales of refrigerated entrées growing

Frozen seafood is also growing area for store brands

Figure 18: U.S. sales and forecast of private label refrigerated entrées and frozen seafood, 2002-12

Figure 19: Total sales and total private label sales, refrigerated entrées and frozen seafood, 2002-07

Segment Performance—Carbonated Beverages

Key points

Branded products rule

Store brands can compete in flavored carbonated water sub-segment

Figure 20: U.S. sales and forecast of private label carbonated beverages, 2002-12

Figure 21: Total sales and total private label sales, carbonated beverages, 2002-07

Segment Performance—Salty Snacks

Key points

As with carbonated beverages, private label makes few inroads in salty snacks

Pork rinds and pretzels show stronger private label sales

Figure 22: U.S. sales and forecast of private label salty snacks, 2002-12

Figure 23: Total sales and total private label sales, salty sancks, 2002-07

Segment Performance—Pizza

Key points

Private label losing ground in refrigerated sub-segment

Store brands comprise less than 10% of frozen sub-segment

Figure 24: U.S. sales and forecast of private label pizza, 2002-12

Figure 25: Total sales and total private label sales, pizza, 2002-07

Retail Channels

Key points

Supermarket private label dominates

Figure 26: U.S. sales of private label food, by retail channel, 2005 and 2007

Retail Channels—Supermarkets

Key points

Private label sales grow as food prices rise

A wide range of strategies

As consumers shop a more diverse array of channels, they are offered a wider array of private label products

Tesco enters the American market; will consumers’ attitudes towards private label change?

Figure 27: Supermarket sales of private label food, at current prices, 2002-07

Market Drivers

Household income affects spending on food

Figure 28: Share of expenditures for food at home, by income, 2006

Age also influences purchase patterns

Figure 29: Population aged 18+, 2002-12

Hispanics are more likely than average to purchase store brands

Figure 30: Population, by race and Hispanic origin, 2002-12

Who Shops for Food?

Key points

More than half of food shoppers shop alone

Figure 31: Participation in household food shopping, by gender, age, household income, race/Hispanic origin and marital status, January 2008

Where Grocery Shoppers Buy Their Food

Key points

Income determines food shopping venues

Figure 32: Grocery shopping venues, by income, January 2008

How Much They Spend

Key points

Mean spending varies by demographic characteristic

Figure 33: Mean weekly spending on food, by gender, age, household income, race/Hispanic origin and marital status, January 2008

Buying Store Brands

Key points

Age matters

Figure 34: Percentage of weekly store-brand food purchases, by age, January 2008

Where Shoppers Buy Store Brands

Key points

Supermarkets are source of store brands for more than seven in ten respondents

Figure 35: Venues for the purchase of store-brand food, by age, January 2008

Figure 36: Venues for the purchase of store-brand food, by income, January 2008

Which Store Brands Do They Buy?

Key points

More store brands than ever

Figure 37: Propensity to purchase specific store brands, January 2008

Frequency of Purchasing Store Brands

Key points

What they buy

Figure 38: Frequency of purchasing specific store-branded products, by age, January 2008

What they don’t buy

Figure 39: Likelihood of not purchasing specific store-branded products, by age, January 2008

Figure 40: Likelihood of not purchasing specific store-branded products, by income, January 2008

Opinions about Store Brands and National Brands

Key points

For more than seven in ten respondents, store brands are equal in quality to name brands

Figure 41: Opinions about nationally branded and store-branded products, by age, January 2008

Appendix: Other Useful Consumer Tables

Figure 50: Grocery shopping venues, by race/Hispanic origin, January 2008

Figure 51: Percentage of weekly store-brand food purchases, by race/Hispanic origin, January 2008

Figure 52: Frequency of purchasing specific store-branded products, by income, January 2008

Figure 53: Frequency of purchasing specific store-branded products, by race/Hispanic origin, January 2008

Figure 54: Likelihood of not purchasing specific store-branded products, by race/Hispanic origin, January 2008

Figure 55: Opinions about nationally branded and store-branded products, by race/Hispanic origin, January 2008

Figure 56: Opinions about nationally branded and store-branded products, by income, January 2008

Appendix: Trade Associations

Abstract

• Who shops for food, where do they shop, and how much do they spend?
• Which consumers purchase private label foods, and in which categories?
• Where do consumers buy store brands?
• What products do consumers prefer not to buy in store brands?
• What do consumers think about the quality and variety of private label products?
• Can US stores base their private label programs on advanced British models?
• Can stores compete with each other on the basis of their store brands?
• What can store brands do to enhance the “store as a shopping experience”?

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