Private Brand Growth Helps Boost Revenue At Sprouts Farmers Market
Sprouts Farmers Market’s own brand product assortment continues to expand and is serving as a key driver of growth for the grocer.
In the third quarter, when the company reported a 14% jump in sales to $1.9 billion, Sprouts Brand products contributed 23% of total sales or about $437 million. The private brand assortment continues to grow, with more than 300 items introduced so far this year.
“Our Sprouts Brand continues to gain affinity with unique items and attributes that our customers desire,” Jack Sinclar, Sprouts’ chief executive officer, said during the company’s quarterly investor conference call. “We’re very excited about the launch of our new line of more than 130 premium body care and home fragrance items called Real Root by Sprouts this past month. They’re free from many things including parabens, phthalates, artificial fragrances and colors. These products help customers live healthier, nurturing inner and outer well-being.”
In October, Real Root products hit store shelves. The assortment includes more than 130 body care, personal care, and home fragrance products. Sprouts collaborated with a boutique fragrance house to create exclusive scents for the new collection. The line will also feature fall and holiday scents, including apple bourbon, pumpkin spice, peppermint vanilla, candy cane, frankincense and myrrh, spiced chai, and juniper berry.
Additionally, Sprouts has also taken steps to boost the visibility of its own brand products. In July, the grocer held its first Sprouts Brand Discovery Days, which Sinclair said was well received and drove outside growth for the brand.
“Stores have embraced the opportunity to go big, and we saw some tremendous displays and sampling showcasing better-for-you products, such as our rebranded coconut rolls and fall seasonal items,” he said.
Beyond the growth of its own brand products, Sinclair said Sprouts remains nimble in reacting to evolving consumer needs. Responding to consumers’ pivot back to food-at-home, the grocer has increased its meal solutions across fresh and frozen with products such as grass-fed beef, stuffed peppers, and grass-fed meatballs.
“Our ongoing innovation efforts continue to be a differentiator for us,” he said. “We have transitioned 170 new items from our Innovation Center to our inline shelves. Our foraging team also continues to explore new tastes and trends from across the globe.”
On the marketing front, Sprouts continues to tailor its efforts to reach shoppers while adjusting its approach based on regional and market difference. An area that has played a key role in this effort is the grocer’s accelerated use of social media.
“Our team has brought our unique assortment and experience to life and has found willing partners with many influencers and celebrities, whose products and purposes align with ours,” Sinclair said. “What is even more encouraging is seeing authentic posts from our customers, sharing their experiences in-store and with our products. As a result of our marketing efforts, we’re seeing more new customers, improved customer retention and increased shopping frequency, leading to strong comp traffic momentum. Additionally, we’re seeing more customers from younger cohorts, which bodes-well for the future.”
