State Of A Growing Industry
The private label segment is hot, is growing, and shows no signs of slowing. As the industry prepares to gather for the Private Label Manufacturers Association’s annual Private Label Trade Show in Chicago, many brands are looking toward 2025 and preparing for another year of growth.
Throughout 2024, retailers of all shapes and sizes have expanded their assortments of own brand products, and the opportunity for growth has attracted more manufacturers to the annual event kicking off November 17 at the Donald E. Stephens Convention Center.
As the industry grows, the needs of manufacturers and retailers evolve as well, and PLMA continues working to educate the business on key issues, provide opportunities for the sharing of ideas, and serve as a conduit for future growth. Peggy Davies, president of PLMA, spoke to Store Brands to share her insights on the industry as a whole and some of the new initiatives put in place by the association.
STORE BRANDS: In recent years, inflation has been cited as the key driver of growth for private label product sales. Are economic issues still driving sales growth or are there other factors that are also playing a role in boosting sales?
PEGGY DAVIES: I think one of the reasons for the continued growth of private label products is that consumers now view store brands as brands. Their shopping lists probably include their favorite items that are store brands, which they buy each time they shop. These products are now part of their routine when they shop. Based on figures from Circana, we’re projecting private brand sales will surpass $262 billion in 2024. And while there are always cycles year after year, this time feels different. It feels like we’ve got some stickiness now and we will be maintaining the growth we have been experiencing.
SB: How has the continued growth of private label product sales in recent years impacted PLMA’s annual show in Chicago and how the association serves its retail and vendor communities?
PD: We are constantly watching and learning about continued changes in demographics, in trends, and other issues that ultimately attract a wide range of people to the show in Chicago, and we’re that one-stop shop they are looking for. Since we’ve been back in person in 2022, we have a larger footprint of international exhibitors and the demographics of who attends the show continues to change. We’re also seeing more new products being introduced, which can be seen at the show in the New Product Expo and Idea Supermarket. With our Salute to Excellence, we did the judging a few weeks ago and had more than 700 products this year. And we’ll also be including wine in our Salute to Excellence display (at the Chicago Show) this year. The show will also have some great speakers including Tom Vierhile with Innova Market Insights, who will talk about Top Trends for 2025.
SB: When you look at the industry as a whole over the past 12 months, what factors are you seeing that are allowing private label sales to continue to grow?
PD: I think it’s the way retailers have gone to market with new products. They continue to not only pay attention to product trends but also to packaging trends. There are a lot of new and innovative things happening on the packaging side, which catches the eye of the consumer as they’re picking up something and putting it in their pantry. It’s a different platform now than it used to be, and there are a variety of things that are helping the industry grow.
SB: With the growth in private label in recent years, is there a noticeable change in the companies exhibiting at the show and the retailers who are attending?
PD: Yes and no. With so many of our member manufacturers, their business has been built on year-in and year-out attending and exhibiting at the show. With our Amsterdam Show, which has been sold out for several years, many of the exhibitors at that show also want to understand how to do business in the U.S. We recently had a webinar focused on educating international companies on how to navigate the U.S. market. This allows them to be better prepared for conversations with U.S. retailers.
SB: In January, Store Brands Month will debut. What was the driving force behind this initiative?
PD: The goal is to build awareness. Anyone can sell a product at a price. As we know, the key to achieving that stickiness with consumers is getting on their shopping lists. We have several retailers that are on board and have asked [PLMA] for information. We have a variety of information on the PLMA website, and we held a webinar to introduce the concept to everyone. But the bottom line is the effort to have retailers build awareness of their own brands with shoppers and highlight the options available to stock their pantries with quality products at a value.
SB: When the idea was introduced, what was the reception from the industry?
PD: Nothing but positive. We’re also working with National Calendar Day, which is the association that promotes all the many “days” throughout the year to make sure Store Brands Month is included.
SB: What will consumers see in stores during Store Brands Month?
PD: I think it will be different things at different retailers. There could be some promotion on-shelf or online. It might be something as simple as an Instagram or Facebook post or an online shopping experience. We’re going to learn as we go, and we’ll share those learnings and hopefully boast about it a bit.
SB: How does Store Brands Month tie into PLMA’s broader strategy of promoting private label and the innovation the industry is now seeing?
PD: It ties into the fact that PLMA is here for the industry. It doesn’t matter what country you’re in, what category you’re in, or what space you occupy, we want to continue raising awareness that these brands are brands and they have a place in the marketplace. And as trends come and go, private brand products will also come and go, because retailers want to offer consumers the right products at the right time.
SB: As the private label industry continues to evolve, how do you see PLMA’s role evolving to support the expected continued growth and the innovation that will be forthcoming?
PD: We have great platforms with the PLMA website and PLMA Live!, along with our newsletters that allow us to bring forth different topics that people may not be aware of or different opportunities that people may not know about. One of the programs that we run before the Chicago trade show is our executive education program. This allows us to focus on important topics that may not always come to the forefront and also discuss the changing retail landscape. We also want to make sure the industry is focused on important topics, and during the [Chicago] show we’ll have speakers discussing AI, top trends for 2025, and future opportunities for private label. We’re also excited to have Dave Rinaldo, president of Aldi, as one of our breakfast keynote speakers at the show.
