Economic angst brought on by the COVID-19 pandemic has shifted consumer spending toward buying more store brands. According to data from mobile platform and analytics company InMarket shared exclusively with Store Brands, overall purchases of store brands are up 12% since March 1, compared with both January and February.
Interestingly though, the consumer survey said this increase is especially prevalent among shoppers who earn more than $100,000 annually. Store brand sales are up 15% for this demographic when compared with their pre-pandemic shopping habits. Consumers 50 years old or older are spending 9% more on private labels during pandemic shopping versus pre-pandemic; the largest increase among age groups.
Los Angeles-based InMarket's Insights program studied the purchase behavior of nearly 60,000 opted-in shoppers, who shared receipt data through shopping and loyalty mobile apps that InMarket works with.
“The shift in behavior among high-earning shoppers could be a result of the unprecedented uncertainty that we’re all facing right now, particularly with record unemployment numbers,” said Michael Della Penna, chief strategy officer at InMarket. “Stock shortages across essential product categories like paper goods may also be a contributing factor, with private label options with availability replacing brands.”
Della Penna said the numbers show a chance for private brands to earn consumer favor through usage and trial and ultimately sees this adding to a net win for private brands.
“For private label brands who can deliver high satisfaction and value, it becomes a huge opportunity to win more customers, grow loyalty and increase share within the category,” Della Penna said. “While a 12% increase in spending might not be sustainable, the added use and exposure of private label brands is expected to contribute to their steady rise in share since 2015. Therefore, we do expect this to be a net win for private labels.”