Private Brands Save Shoppers 33%

A new study of comparative prices on a wide range of everyday grocery purchases demonstrates why more shoppers than ever before are steering past the national brands and reaching for the retailer’s brand instead.

Over a six-week period, the study revealed that shoppers on average could save 33.3% off their grocery bill by filling their baskets with the Private Brands including 40 essential household items and pantry staples. The study reaffirms what shoppers have long known Private Brands save customers money.

The research, conducted by the Private Label Manufacturers Association (PLMA), tracked the pricing for typical grocery items at a conventional supermarket. Included in the survey were spring cleaning items like glass cleaner, paper towels and pine oil disinfectant, as well as two dozen pantry staples like corn flakes, pasta sauce and carbonated beverages, and personal necessities like mouthwash and facial tissue.

The study results indicate that consumers who choose the retailer’s brand for products on the list rather than the national brand could save $42.30 (a savings of 33.3%) on average on their total market basket. When buying the national brands the 40-item purchase came to $127.03 on average over six separate trips, while the same purchases for the retailer’s brands cost $84.73. The survey took place over a six-week period in a suburban supermarket located in the northeast.

For every category in the study, a leading national brand product was compared to a similar store brand product and prices were adjusted to account for all known discounts, coupons and promotions available for each of the six shopping visits in the study.

Among individual food items the cost savings ranged as high as 46.8% on carbonated beverages, 45% on ice cream, 43.5% on hot dog buns, and 40% on pasta sauce. Savings in many non-foods categories were even greater, led by apirin (the store brand version cost 60.6% less on average), pine-oil cleaner (57.3% less), body lotion (53.5% less) and facial tissue (50% less).

(Click here to download the complete chart of market basket products and prices)

Average savings of a full one-third off their regular grocery purchases can help explain why shoppers are choosing the retailer’s brands for roughly one of every four products they buy in the supermarket. Data from The Nielsen Company show that annual sales of private label products grew by more than $18 billion over the most recent 5-year period and unit market share for private label in U.S. supermarkets is now 23.5%.

The Private Label Manufacturers Association is the industry trade association devoted exclusively to store brands. Founded in 1979, PLMA today represents over 3,000 companies who are involved in the manufacture and distribution of store brand products. The products supplied by PLMA members include food, beverages, snacks, health and beauty aids, over-the-counter drugs, household cleaners and chemicals, outdoor and leisure products, auto aftercare and general merchandise.

The survey was conducted weekly during the 6-week period from February 12 through March 19, 2011.

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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.