Consumer Reports: Private Brands On Top

Over the last few years I have written post after post that confirmed and reconfirmed that customers are not only choosing to purchase Private Brands but that they are making them their brands of choice. In an affirmation of that premise Consumer Reports released a study on Tuesday, Consumer Reports concludes that many private brands are as good as or better than national brands.

Private brand products can compete with their name-brand counterparts and save shoppers more than a thousand dollars a year on grocery bills, according to a new study from Consumer Reports. In 21 head-to-head taste match-ups, national brands won seven times, the Private Brand came out on top in three instances, and the remainder resulted in ties.

“The study reaffirms that store brands are worth a try,” said Tod Marks, senior projects editor for Consumer Reports. “For a family that spends $100 a week on groceries, the savings could add up to more than $1,500 a year.”

Consumer Reports‘ price study evaluated five supermarket chains and compared private- and name-brand prices for 30 everyday items at five chains, collecting a total of 283 price quotes.  Consumer Reports found the average savings with Private Brands was 30 percent, but shoppers saved as much as 52 percent on some items.

Private Label stigma
Although the savings are significant, some shoppers are still reluctant to try store-brand products, according to a Consumer Reports nationally-represented survey. The top reasons for those who don’t buy store brands are: “I prefer name brands,” “The name brand tastes better,” and “I don’t know if store brands are as high in quality.” Respondents 18 to 39 years old were particularly likely to question the quality of store brands.

Still, 84 percent of Americans purchased store brands in the past year, and 93 percent of store-brand shoppers said they would keep buying as many store brands after the economy recovers. Nationwide, store brands accounted for almost one of four products sold in supermarkets and a record $55.5 billion in sales last year.

Consumer Reports found nutrition similar for most of the tested products, despite the perception among 17 percent of survey respondents who said that “name-brand foods are more nutritious.” The most notable differences: Mott’s applesauce has more sugar than Publix, Ore-Ida fries have more sodium than Jewel, and Kellogg’s Froot Loops have 3 grams of fiber vs. 1 gram in Stop & Shop Fruit Swirls.

Shoppers are devoted to certain categories as well. Though they’ll purchase store-brand paper goods and plastics, at least half of respondents rarely or never buy store-brand wine, pet food, soda, or soup. But Consumer Reports trained testers found that when it came to products like soup, the name brand didn’t always reign:

  • Chicken soup: Food Lion’s (36 cents per serving) Lotsa’ Noodles soup beat out Campbell’s Chicken Noodle (41 cents per serving) for having a little more intense flavor. Campbell’s had oily broth, with fatty pieces of chicken.
  • Orange juice: Publix Premium won over Tropicana for having a bit less of a cooked flavor with slightly less bitter taste.
  • Hot dogs: America’s Choice (A&P, $2.64 per package) beef hot dogs trumped Oscar Mayer ($3.65 per package) for their juicy and flavorful franks.

Name brands did win in seven of the categories, including mayonnaise, mozzarella cheese, and frozen French fries, but the majority of the match-ups found that the store brand and name brand were of similar quality. A tie doesn’t mean the taste was identical. Two products may be equally fresh and flavorful, with ingredients of similar quality, but taste dissimilar because the recipe or seasonings differ. Some products that tied include:

  • Ketchup: Heinz ($2.76 per bottle) is spicier, while Target’s Market Pantry ($1.174 per bottle) brand is more tomatoey.
  • Peanut butter: Tasters detected more deeply roasted nuts in Skippy (19 cents per serving), while Albertsons (15 cents per serving) has a hint of molasses flavor.
  • Potato chips: Both Lays (29 cents per serving) and Walmart’s Great Value (15 cents per serving) have a nice balance of real potato flavor, fat, and saltiness.

Significant Savings
National brands are generally pricier than store brands, not so much because of what’s in the package but because of the cost of developing the product and turning it into a household name.

There’s no reason store brands shouldn’t hold their own, since some companies manufacture both, including Sara Lee, Reynolds, 4C, McCormick, Feit, Manischewitz, Joy Cone, Stonewall Kitchen, and Royal Oak. Plus, most grocers offer a money-back guarantee if their products can’t meet the consumer’s expectations. (National brands stand behind their products too, of course).

Despite the savings, the price advantage may be narrowing. In recent years, some national-brand makers have lowered prices and stepped up promotional activities. The full results on how all the brands stacked up, Consumer Reports‘ study are available in the October issue on newsstands September 7 and online at www.ConsumerReports.org.



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Christopher Durham

Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan).

Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s.
Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago.

Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.