The Premiumization of Private Label ― Innovation Leads the Way

It wasn’t too long ago that private labels (also known as store brands) were seen as more affordable alternatives for consumers as opposed to name brands. However, the last decade brought major changes to the perception of private label products, as well as the perceived quality of those items. From packaging to materials to the brand names used for private labels, there are a number of significant changes that drove this shift in consumer perceptions of store brand purchases.

For example, just take a look at the Kroger supermarket chain’s household and grocery products that are marketed toward urban millennials. Instead of packaging that could be considered “safe” or “routine,” the Uniquely J brand brings a healthy dose of fun and even artistry into the shopping experience.

As a result of private labels creating products with more shelf appeal, the market share of store brands is continually on the rise these days. No longer is the popularity of these products tied directly to economic downswings, but rather private labels are becoming more successful every year, even as the economy continues to surge upward.

Of course, this trend wouldn’t be possible if the quality of the private label products wasn’t just as good as the name brands they compete with. In the past, store brands were seen as being of lower quality, which made it easy for most consumers to justify paying a bit extra for the name-brand options. Grocery items were perceived to be lesser alternatives, even if the products themselves were of equal quality to the big brands. Beauty products sometimes weren’t produced according to the same standards as their brand-name counterparts. However, today’s private labels aren’t just on equal footing with the big brands, they’re often manufactured by the same company, or even in the same facilities.

Another major factor for this shift in consumer attitudes is the developing attribute of private labels as trend-setters. Whereas store brands used to take a back seat to the name-brand products they emulated, today’s private labels are becoming ever more savvy in developing new products in a trendy manner. Trader Joe’s is especially adept in this regard, as their cauliflower crust frozen pizzas receive rave reviews, while major labels like California Pizza Kitchen are just recently warming up to the trend.

The rise of private labels has even helped some popular chains of retail stores to change their image. Take Walmart for example. Their new Winemaker’s Selection line of private label wines ― which launched in 2018 ― is doing a great job of bucking the retailer’s low-cost image, with appealing labels that look considerably more expensive than they really are. As for the product itself, Walmart wine is drawing excellent reviews from independent sommeliers, as well as judges at industry awards shows.

In short, private labels have come a long way from the Our Family and Great Value branded products of years gone by. Today’s store brands aren’t just copycats, they’re viable contenders for any discerning consumer’s money. Private labels in 2019 are thriving, thanks to their high-quality products that can compete with any major brand name, as well as their elevated packaging and clever marketing.

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