There They Grow Again

Each year, Store Brands takes a look at the private brand “Movers and Shakers” — the food/beverage and non-food categories and subcategories in which store brands posted dollar and unit sales gains of 5 percent or more and hit $5 million or higher in sales during the past year. Making this year’s Movers and Shakers list, according to Chicago-based market research firm Information Resources Inc. (IRI), are an impressive 73 food/beverage categories and 46 non-food categories (52 weeks ending May 18; U.S. supermarkets, drugstores, mass market retailers, including Walmart, military commissaries and select club and dollar retail chains). See the tables, beginning on p. 32.

Convenience rules

Topping the food and beverage list for the second year in a row is single-cup coffee. Store brand dollar sales here rose 234.9 percent to reach $246.2 million. Unit sales climbed 236.2 percent.

“Single-cup coffees are registering phenomenal growth even as national brands continue to expand their offerings,” says Carol Spieckerman, president of the newmarketbuilders retail consultancy.

Consumers’ desire for convenient offerings is one of the drivers behind the strong growth of single-serve coffee, as well as other categories on the list. Spieckerman points to pizza crusts/shells (+64.8 percent in dollar sales and +76.3 percent in unit sales), shelf-stable microwaveable packaged dinners (+30.3 percent and +20.1 percent) and refrigerated handheld breakfast entrées (+15.7 percent and +11.2 percent) as some other Movers and Shakers categories tied to convenience.

“Twenty-one percent of Americans eat on the run, grabbing something to eat or drink as the opportunity arises,” notes Susan Viamari, editor, thought leadership for IRI, citing the findings of the recent IRI Consumer Snacking Survey.

Among the other convenience-minded categories showing up on the food and beverage list are nutritional snacks/trail mixes (+12.5 percent and +10.3 percent), snack nuts (+8.1 percent and +8.9 percent) and convenience/PET still water (+10.8 percent and +11.0 percent).

Eye on health

Also evident on the food and beverage list is the trend toward healthful fare. Some of the better-for-you categories making an appearance on the list are nutritional/intrinsic health value bars (+20.8 percent and +9.0 percent), refrigerated kefir/milk substitutes/soymilk (+18.2 percent and +17.4 percent), frozen fruit (+13.8 percent and +10.0 percent) and olive oil (+13.5 percent and +11.6 percent).

“Fifty-five percent of consumers try to eat healthy at least half the time,” Viamari says. “In food and beverage, there is increased interest in products that offer more of healthy ingredients — for example, whole grains, protein, etc. — and less of ‘less desirable’ ingredients — for example, fat, calories, etc.”

In addition to convenient and healthful offerings, today’s consumers are seeking out a little adventure in terms of flavor.

“Exciting and exotic flavors are also very much sought out these days,” Viamari states. “Consumers are eating at home more often, but they still want excitement such as unexpected flavors, textures, etc.”

That desire for flavor excitement, she says, could be behind the growth of store brand spices and seasonings (+10.2 percent and +8.7 percent), potato chips (+5.3 percent and +7.3 percent) and sparkling/mineral water — which often is flavored (+5.8 percent and +7.8 percent).

Trend toward self-treatment

On the non-foods side, the trend toward do-it-yourself (DIY) healthcare has been a boon for categories such as “other” home testing kits (+6,543.5 percent and +8,355.7 percent), glucose (+15 4 percent and 32.0 percent) lice treatments (+9 6 percent and +111 percent) and muscle/body support devices (+6.0 percent and +6 2 percent)

“The exponential growth in home testing kits validates that healthcare isn’t exempt from the DIY trend hitting other categories,” Spieckerman adds “The numbers should be quite encouraging to retailers as they continue to push into healthcare services. It confirms that consumers already see retail stores as viable healthcare hubs.”

Although Viamari notes that 36 percent of consumers do self-treat where possible, citing findings from a recent quarterly IRI MarketPulse Survey, many items making the Movers and Shakers list are geared toward general health.

“In non-foods, products are making homes, pets, hair, skin, nails, etc. healthier,” she says. “For instance, making hair more beautiful by repairing damage, making skin more beautiful by reducing wrinkles, making the house healthier by removing bacteria.”

On the beauty side, categories such as foundation (+75.6 percent and +78.3 percent), eye shadow (+15.3 percent and +21.3 percent) and makeup remover — lotion/gel (+5.6 percent and +7.2 percent) made the list.

“The fact that several beauty items made the list confirms that many consumers no longer feel the need to make destination trips to specialty and department stores for their beauty needs,” Spieckerman says. “Retailers have done a remarkable job of building trust in a category that has traditionally been quite brand-driven.”

Falling outside the health and beauty space but experiencing notable growth is the “all other” batteries category (+23.9 percent and +124.1 percent).

“The growth in battery sales bears out the overall growth and widespread adoption of in-home technology and multi-device households,” Spieckerman says. “However, as battery technology evolves, battery life promises to lengthen, which will eventually compromise the frequency and volume of purchases.”

Stay in growth mode

To keep store brands in growth mode, retailers will need to stay abreast of consumers’ wants and needs, Viamari notes.

“This means that national/regional brand manufacturers and retailers/store brand marketers must work together to provide a balanced assortment of national and private label solutions,” she says, “targeted at the store level, to offer solid value to key and high-potential shoppers.”

And value that goes beyond just a great price will be essential, Viamari adds.

“Consumers want smart splurges that allow them to pamper themselves, keep life exciting, simplify tedious tasks, etc.,” she says.

Also critical to success is retailers’ ability to keep up with changing technology and a commitment to treating store brands as true brands, Viamari says — “brands that innovate outside the box to bring the unexpected to retail shelves.”

Today’s consumers are seeking out a little adventure in terms of flavor.