Consumer Trust In Private Label Offers Growth Opportunities
Maintaining growth is an ongoing conversation across the private label industry, and new data from NielsenIQ reveals that consumers are open to increasing their spending on store brand products if more items were available.
In NIQ’s report, Finding Harmony On The Shelf: 2025 Global Outlook on Private Label & Branded Products, 59% of U.S. consumers say they would buy more private label products if a larger variety were available.
The report also found that 72% of consumers said private labels are good alternatives to name-brand products, with 75% saying store brands are a good value for the money.
At retail, consumers said they are most likely to purchase private label products at supermarket/grocery stores, dollar stores, discount retailers, and pharmacy/drug stores.
Additionally, 59% of consumers said they trust store brands since they are endorsed by the retailer. That level of trust is consistent across four key demographic groups, with 58% of Baby Boomers, 55% of Gen X, 63% of Millennials, and 62% of Gen Z saying they trust private label brands.
“The landscape of store brands has changed dramatically,” said Steve Zurek, vice president of Thought Leadership, Analytics & Activation with NIQ. “Gone are uninspired packaging, 'me too’ bottle shapes, and mediocre taste profiles. Retailers have taken a page out of the brand marketing playbook and are designing appealing, high quality products with their own brand names. This poses a unique challenge for national brands.”
With annual sales of private label products up 4.1%, according to NIQ, nearly half of consumers (49%) said they’re likely buying more private label products than ever. The rate of sales growth for private label is outpacing the Top 100+ national brands (+2.4% annual sales growth), the Top 11-100 national brands (+2.3%), and the Top 10 national brands (+1.7%).
The Nielsen report also highlighted the price differences between private label and national brands across several key categories. As a whole, branded products on average are sold at prices that are 19% higher than store brands. The breakdown by category includes (national brand pricing vs. store brand pricing):
• Frozen food +2.1%
• Paper products + 39.9%
• Healthcare +41.8%
• Food perishables +4.4%
• Beverages +22.1%
• Ambient Food +27.1%
• Home Care +42.3%
• Beauty & Health +57.8%
• Alcohol +3%
• Pet Food +7.9%
• Snacks -0.3%
