When evaluating competing products, if a consumer is unable to perceive any intrinsic differentiation, price quickly becomes the primary purchasing factor. In this statement lies the breeding grounds of generic, private label goods.
So as the economy has soured and household budgets have tightened, have brands been successful at convincing consumers to make purchasing decisions based on something besides price?
A global survey by The Nielsen Company, as chronicled in The Global Staying Power of the Private Label, attempts to answer this question. Some of the survey’s notable observations included:
* 60% of North American consumers purchased more private label brands during the recession.
* 88% of shoppers globally intend to keep purchasing private label even after the economy improves.
* Store brand unit sales reached an average 22% share across all departments in North America, though there was substantial variance. Dairy products had a store brand unit share of 40% compared to alcoholic beverages whose store brand unit shares were less than 1%.
Nielsen noted that economic pressures are only one factor influencing this rise in private label purchases. Increasingly, consumers cited improvements in the quality and selection of private label brands as significant purchasing factors. Private label brand share, however, typically suffered among products that received strong marketing support (such as candy and beer) or products with greater levels of innovation (such as detergents or cosmetics).
@NeilAndrewJames
TweetTags: private label, shopping trends
This entry was posted on Thursday, August 26th, 2010 at 9:43 am and is filed under Trends. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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