 Growth and Success Store brands now account for one of every five items sold every day in U.S. supermarkets, drug chains and mass merchandisers. They represent a nearly $50 billion segment of the retailing business that is achieving new levels of growth every year.
It's no wonder store brands are held in such high esteem. They are a boon to consumers' pocketbooks. U.S. shoppers who reached for the store brand version of their favorite grocery products rather than the national brand, logged an estimated $15.8 billion in annual savings, based on industry sales data. The difference is the so-called "marketing tax," which consists of advertising and promotional costs incurred by national brand makers that are passed on to consumers in the form of higher prices at the shelf. Store brands are important to retailers, too. Throughout the U.S., retailers use store brands to increase business as well as to win loyalty of customers. Whether a store brand carries its own retail name or is part of a wholesaler's private label program, store brands give retailers a way to differentiate themselves from the competition. Store brands serve to enhance the retailer's image and help cement its relationship with consumers. Retailers know that consumers can buy a national brand anywhere, but they can only buy their store brand at their store. What are store brand products?
What products are sold as store brands? Major supermarkets, drug and discount store chains can offer consumers as a store brand almost any product that is manufactured and mass merchandised. Food, drug and discount store brands cover full lines of fresh canned, frozen and dry foods, snacks, ethnic specialties, pet foods, health and beauty aids, over-the-counter drugs, cosmetics, household and laundry products, lawn and garden chemicals, paints and hardware, auto aftercare, stationery, and housewares. What are the advantages of store brands? For the consumer, store brands represent the choice and opportunity to regularly purchase quality food and non-food products at savings compared to national brands, without resorting to coupons or promotional pricing. Store brands consist of the same or comparable ingredients as the national brands and because the store's name or symbol is on the package, the consumer is assured that the product is manufactured to the store's quality standards and specifications. Who makes store brands? Manufacturers of store brand products fall into four classifications:
A unique organization for a unique industry The store brand business is unique. It has its own needs and objectives. That's why there is a trade association that serves this industry exclusively. The Private Label Manufacturers Association founded in 1979, represents more than 3,200 companies around the world and offers trade shows, programs and services that are specifically designed for the industry. For more information regarding membership and trade shows, please contact PLMA at (212) 972-3131. |
For American consumers, store brands are brands like any other brands. In a landmark nationwide study, 75% of consumers defined store brands as "brands" and ascribed to them the same degree of positive product qualities and characteristics - such as guarantee of satisfaction, packaging, value, taste and performance - that they attribute to national brands. Moreover, more than 90% of all consumers polled were familiar with store brands, and 83% said that they purchase these products on a regular basis.
