Gen Z Key In Driving Private Label Growth
Gen Z’s impact on sales of private label products has been a hot topic in recent years, and new data from Numerator shows this demographic group’s consumption of store brands will continue to grow in the near future.
According to Numerator, private label items account for 17.9% of spending for Gen Z, trailing only Baby Boomers at 18.3%. However, forecasts from the consumer research company indicate that private label spending among Gen Z is expected to increase to 18.4% in 2026, surpassing the spending of Boomers, which is projected to remain flat.
The anticipated growth with Gen Z comes as Numerator research found this generation, along with Millennials, are among the most price-pressured shoppers, with a growing share falling into the bottom third of purchasing power.
In January 2020, 72% of Gen Z and 41% of Millennials were in the lowest third of purchasing power. By 2023, those figures had declined by 13 and 10 percentage points, respectively, but remained largely unchanged and have started to reverse through the start of 2025.
“That stall has made private label a necessity and, increasingly, a preference,” Numerator wrote in its report. “Gen Z is driving the largest gains in private label and is on pace to overtake Boomers, long considered the most loyal store brand shoppers, within the next year-and-a-half. It challenges historical assumptions and opens the door for brands and retailers to engage Gen Z in new, more meaningful ways that reflect their values, their constraints, and their growing influence on the market.”
Not surprisingly, purchase motivators for Gen Z shoppers differ from those of older consumer groups. Retailers seeking to expand the reach of their own brand assortments to this group of young consumers must consider key motivating factors. They include:
- Discovery: Social media platforms like TikTok and Instagram, often guided by influencers, are becoming the primary on-ramps to new private label products.
- Drivers: Packaging design and transparent labeling are essential, not optional. These elements carry more weight for Gen Z than for any other age group.
- Perception: Store brands are seen as trendy, innovative, and increasingly premium as the old stigma is fading.
- Values: Sustainability and better-for-you claims play a central role in decision-making.
Gen Z also shows engagement with retail private brands that differs from that of Baby Boomers and Gen X. According to Numerator, Gen Z overindexes on elevated private label brands such as Ulta Beauty, Wild Fable, Cat & Jack, Costco’s Kirkland Signature, and Trader Joe’s.
“These aren’t placeholders for national brands; they are purposeful choices that blend style, value, and identity,” Numerator wrote.
Boomers favor private labels at Lowe’s and Harbor Freight, mirroring their high rates of homeownership, while the top store brand choices of Gen X include Kwik Trip and Wawa, which are brands aligned with a commuter-centric lifestyle.
