Why Gen Z is Turning Private Label Into A Cultural Flex
This year, close to two billion Gen Z’ers will come of age—and they’re rewriting the rules of “add to cart.” Private label products are the new Gen Z darling, but first, retailers need to get it right.
Blame it on the skyrocketing price of eggs, the looming tariffs on imported goods, or every new generation’s desire to “do different.” The reality is that members of Gen Z are entering their prime spending years amid economic uncertainty, inflation, and a growing mistrust of big brands that have them reconsidering the national brands they grew up with. It’s easy to see why, as a generation that’s shopping with eyes wide open.
On TikTok, #shrinkflation videos have more than 296 million views. Fast fashion is officially a dirty word (even as Gen Z remains addicted to it). Gen Z is now using buy-now-pay-later apps such as Klarna to pay for essentials including groceries, while carrying more debt than any generation before.
Capitalism has done them dirty and they’re looking to buck the system. Affordable, surprisingly stylish, and just-as-good-if-not-better—private label products are their weapon of choice. One they buy, eat, drink, wear, and share with pride. In other words, they’re proudly private label lovers.
Need proof?
In this new reality, Walmart’s $60 Birkin-like, the Wirkin, went viral and then quickly sold out. Japanese convenience store, Family Mart, has appointed Kenzo’s creative visionary as its new Creative Director, while #aldifinds and #targetfinds continue to earn billions of views across social media, as young adults enthusiastically share their store brand finds.
It’s giving retailers a significant advantage both in-store and online. In 2024, 30% of Target’s sales were captured entirely by its portfolio of store brands. That number jumps to 80% for retailers such as Aldi and Trader Joe’s whose product assortments are built almost entirely from covetable store brand strategies.
A look at what’s working—and why.
Innovating beyond “as good” to achieve better. Instead of generic or subpar products, retailers are investing in R&D to create private label goods that offer greater quality and more enticing flavors, exciting formats, and covetable aesthetics. For example, Walmart’s Better Goods, which offers pistachio nut butters, raspberry passionfruit coated mini graham cookies, or pineapple fried rice crackers; are all wrapped in a bright, vibrant, color-on-color palette that’s sophisticated and a bit of fun.
They’re also delivering better-for-you and better-for-planet products, such as Good & Gather’s plant-based pizza, Everspring’s greener clean, or the “mindfully made” fibers in Casaluna linens. Many private label items now feature clean ingredients, environmentally friendly packaging, and clear sourcing information–features that resonate strongly with both budget and community-conscious Gen Z audiences.
Playing with high-low. Designing for affordability can signal a bargain price. But by shifting that design to a premium aesthetic, retailers can change what people expect to pay by about 45%. That’s a good thing! Packaging designed to look premium, but with a low price, conveys incredible value. It taps into that feeling of getting more for less. Like Target’s Favorite Day, whose baked goods look like a French patisserie, without the imported price tag. Or ShopRite’s Bowl & Basket, which looks deliciously culinary, but is accessible to a budget shopper.
Delighting in the dupe. With Gen Z a well-crafted dupe is less copycat, more anti-elitist, edgy, and “in the know.” Take Target’s Fine'ry. Scent enthusiasts swear their “Not another Cherry” perfume is the perfect replica of Lost Cherry by Tom Ford. Interestingly, it’s not packaging that signals the replica, but social media. Store brands are cleverly generating buzz through social media, letting real shoppers reveal their dupe discoveries through TikTok and Reddit while declining to comment. It’s a genius stroke of marketing that lets the product’s true quality speak for itself through real shoppers. Especially since 43% of Gen Z shoppers start their online product search on TikTok, more than any other search engine.
These shifts are exciting, but quickly becoming table stakes in the world of private label. To tap into store brands as a true flex, brands need to embrace the unmet and emergent needs of Gen Z.
What’s next—and what we’re excited to see more of…
Clout-raising partnerships. With store brands delivering the quality and clout of national brands, what’s stopping them from acting as brands in their own right? That means partnering with other brands that can elevate perceptions or tap into an entirely new audience. Why not bring in the culinary prowess of a Gen Z influencer like Molly Baz, whose Ayoh! is disrupting mayo with exciting flavors such as Hot Giardinayo? Or tap into the charm of a beloved celebrity like Dolly Parton, who recently partnered with Duncan Hines to create her own line of easy bakes?
Circular and sustainable. With the rise of resellers like Depop, Vinted, and GOAT, it’s no surprise that Gen Z prioritizes environmental and socially sustainable options that still elevate their sense of style. What if retailers took inspiration from Urban Outfitters’ Urban Renewal, whose clothing line is made primarily from sustainably sourced vintage pieces and remnant fabrics? To date, Urban Renewal has kept more than 6 million garments out of landfills by sourcing from vintage and deadstock wholesalers and fabric scraps from the fashion industry.
Beyond that, is there an opportunity to tap into “refillables” across food, personal care, or beauty staples? Retailers can benefit by not only appealing to Gen Z values but also by giving shoppers another reason to return to store.
Beauty gets a glow-up. While food and fashion have benefited from the store brand glow-up, beauty remains relatively untapped and relegated to a basic bargain. Retailers can crack the code on beauty, finding inspiration in cult brands like The Ordinary, which democratized prestige. As budgets tighten, retailers who deliver on the efficacy and everyday luxury of “masstige” could capture the beauty shopper—a market that generates approximately $430 billion in revenue each year across skincare, fragrance, makeup, and hair.
For Gen Z store brands aren’t a necessary evil—but rather, they’re bold personal statements. Choosing store brands is a way to show off savvy shopping skills while rejecting the narrative that luxury equals better. Turns out affordability can be very, very cool. Especially when it taps into Gen Z’s desire for egalitarian quality, elevated vibes, and exciting experiences.
Your move, retailers.
Cait Starke, head of Strategy at Pearlfisher, is a seasoned strategist and has spent the past decade building meaningful connections between brands and people. She has worked with brands including General Mills, Heineken, PepsiCo, Bed Bath & Beyond, and Levi Strauss.
