Private Label, Public Appeal

Private Label Brands Grow in Share of Total Store Sales

Discount stores and a number of other retailers are offering more and more products that are private label. Instead of being limited to selling branded products from major manufacturers like Procter & Gamble, growing numbers of stores are contracting for the manufacture of store-branded merchandise. Such is the case with Wal-Mart and its Ol’ Roy dog food or the Sam’s Choice products found in its Sam’s Club stores. One-half of the goods sold at Target and Kroger stores are now privately branded, and Costco’s Kirkland Signature brand is on everything from cookware to paper goods to food items.

Sales of private-label items are generally growing at a faster rate than those of name brands. Overall, private-label sales in the U.S. (in supermarkets, drug stores, mass-market merchandisers and club and dollar stores) reached $129 billion in 2018, up 4.4% from 2017. In supermarkets during 2018, store brand sales rose 0.5% to $59.8 billion over 2017.

Even is getting into private labels. Amazon launched a line of house brand items called Amazon Elements. Initial products included diapers and baby wipes. Diapers have long been a very high-volume item for Amazon. The Elements line is designed to appeal to eco-conscious and quality-conscious consumers. The firm provides very deep product origin information, such as where and when each item was made and the sources of ingredients. Amazon has also developed a line of electronic accessories called AmazonBasics, which includes chargers.

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Plunkett’s Advertising & Branding Industry Almanac 2020


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