Free IRI report offers strategies for spurring private brand growth
A stronger economy, falling food prices and the maturation of some important private brand sectors are putting the squeeze on store brands, which began to decline in growth in 2015, according to Chicago-based market research firm IRI.
The latest IRI Times & Trends report, “Private Label: The Journey to Growth Along Roads Less Traveled,” looks at how retailers and manufacturers can strike the right balance between national and private brands and provide shoppers with the value and quality they desire.
“Relying on distribution to drive consistent growth is no longer feasible, and we’re seeing this in recent growth and share changes,” Susan Viamari, vice president of thought leadership for IRI, noted in a statement. “Private label is entering the next phase of its evolution, and there is significant opportunity for retailers if they invest the time and resources needed to raise their private label game.”
This past year has seen some noteworthy shifts in channel-level private brand trends, Viamari said. Grocery, club and convenience channels maintained solid footing — even slight growth — in private label share, supported by careful expansion of product assortments across food and beverage and non-food ranges. However, private brands lost ground in the dollar store channel due to strong pricing competition. And the drugstore channel struggled to maintain private brand unit share, losing ground across private label edibles, including candy, bottled water and cookies, the IRI report stated.
The free Times & Trends report discussed the following strategies for spurring private brand growth:
Upstream innovation — Breathe new life into mature private label categories.
Outside-the-box innovation — Ride the wave where private brand growth is escalating.
Effective price-pack architecture — Provide appropriate breadth and depth of assortment where private label is mature and differentiation is challenging.
“It is such an important time in the evolution of private label brands, so this new research is the first installment in private label analyses that IRI will be providing throughout 2017,” Viamari said. “The initial step is for retailers to understand that they have an opportunity to shine, better serve their customers and strengthen customer loyalty. Establishing organic and sustainable private label growth [is important and] requires some nitty-gritty planning and solid execution. But the rewards of getting private label right will be sweet.”