Private Label or Brand Name- Roles reversed


There has been a lot of talk around the idea of brand loyalty. Being from the packaging and design world, heck we are ambassadors for it! But with prices continuing to rise, more people are finding ways to save and buying private label products is one of said ways.

During the pandemic, people stuck to what they knew in terms of brands. They needed that sense of comfort in uncertain times and big names that they knew and loved helped bring that comfort. In turn, this allowed larger companies to soar in sales. However, post pandemic, all we hear now is about supply chain issues, poor growing seasons and other factors that have driven prices to significantly increase in the past several months.

Conversations about everything being so expensive are becoming more common. So what are consumers doing about this? They are saving any way that they can and in most cases that means cutting items at the grocery store all together or going store brand/private label. In June, the Food Industry Association (FMI) released a report that said 41% of shoppers bought more private label items during last year’s spring months than before the pandemic. Inflation for rent, gas, and food at home has only gotten steeper in the last six months, so it makes sense that more consumers have looked to less expensive store brands.

With the surges flip flopping, private label manufacturers and retailers and amped up their game to improve the availability and overall quality of these products. So what does that do to big food companies? In their most recent earnings reports, Unilever and Nestlé noticed that higher prices on the shelves led to fewer sales.

Some other big food companies, including PepsiCo and Kraft Heinz, have decided to stop raising prices to spur demand. Classic case of role reversal.

What will you do?

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