Private brands are a perfect solution to holiday shopping needs, according to new information from private brand consulting firm Daymon. The company released a new infographic showing how consumers view private brands ahead of the holiday season.
Last month, Daymon’s senior director of client services of nonfoods/HBC Jonathan Finch wrote guest blog for Store Brands about how private brands can navigate the supply chain challenges that continue to impact the retail and grocery industries, including ahead of the holiday season. The continued increase in product cost, as well as availability challenges, is helping drive the interest in private brands as alternatives this holiday season.
“Raw materials up between 40%-50% year over year and corrugated paper up between 15-20% depending on the type of pulp used,” said the company. “Further upward pricing pressure is being driven by the increased labor wages, shortages, and transportation costs. Many finished goods manufacturers have, for the most part, held off on passing these increases on to retailers. However, as consumer demand for paper goods increases and supply challenges persist, it will only be a matter of time before these increased costs meet the end consumer.”
According to Daymon’s market research conducted in October of this year, 69% of shoppers are looking for ways to save money while holiday shopping, with 86% planning to purchase private brands for holiday gifting needs.
Those projected numbers are up considerably from last year’s holiday season, when 60% of consumers purchased private brands to save money, with 33% of those surveyed by Daymon saying private brands fit their lifestyle better than branded items. Among consumers under 45-years-old, private brands grew in popularity.
Planning ahead for next year, Daymon said that retailers should plan ahead with a three-part approach. Retailers should develop a marketing plan that will establish a connection with the holiday assortment, expand private brand items across several categories, and increase private brand omnichannel presence to continue attracting younger consumers.