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Private label brand breakthrough: A survey released by Deloitte on brand loyalty could rattle...

Private label brand breakthrough: A survey released by Deloitte on brand loyalty could rattle the food and grocery sectors as a whopping 94% of consumers indicate they will stick with private-label or store brands instead of reverting back to costlier options. Industry insiders think even if the economy comes roaring back, a paradigm shift  of consumer attitudes toward food purchases may already be entrenched. The trend could favor Treehouse Foods (THS), Safeway (SWY), Kroger (KR), Costco (COST), Whole Foods Market (WFM) - while creating a headache for Kellogg (K), Post Holdings (POST), Campbell Soup (CPB), Kraft Foods (KRFT), and General Mills (GIS).
Comments (10)
  • baloney. store brands are inferior, period. give me good ol' corn flakes.. not "kroger" flakes. the economy comes roaring back, people are gonna eat the best tasting foods.
    16 Apr 2013, 01:26 PM Reply Like
  • Oh, so wrong... Kirkland bourbon is a dead ringer for Makers Mark and it's rumored their private label vodka is Grey Goose. There are more raisins and less box taste to Western Family's Raisin Bran. It does depend on the grocer but bottomline it is all in the price. That's why Costco does so well - it maintains quality and is price competitive.

     

    Oh, and don't expect the economy to come roaring back any time soon.
    17 Apr 2013, 12:33 AM Reply Like
  • I've worked for a store brand company for decades... we get our raw materials from the same place, we have the same R&D and Q/A procedures, the stores (our customers) have the same set of criteria for us as for our national brand competitors... the only difference? We don't spend money on marketing and advertising. And we tie or beat the national brand in every comparison I've seen.
    16 Apr 2013, 04:50 PM Reply Like
  • The national or name brands have accomplished their lead by having a superior product and people will return to them after a while. In tough times we dig in and do without or by cheaper, but when good times return the desire to treat ourselves to better for so few pennies extra that the name brands represent will not stop us from reverting to our favorites. Kellog et al will not put the same flakes in a private label that they will in their own branded containers.
    16 Apr 2013, 05:01 PM Reply Like
  • What people say claim they will do and what they will actually do are often on the same. People who said they would never own stocks again are buying stocks, for example. "Forever" equates to about 1 to 5 years, depending on the context. I've been inside a number of consumer packaged goods companies and that made me privy to formulations and allowed me to watch the manufacturing process. For stuff like canned corn, it is often true that various labels are used for the same production run. However, for a good many items, the store label and the branded product are absolutely not the same. In fact, manufacturers will sometimes intentionally do something to degrade the consistency of the product in order to make the differentiation clear. Even with products like fresh fruit, there can be a difference, since the major distributors get first dibs on what the major growers are selling.
    16 Apr 2013, 09:16 PM Reply Like
  • This is flawed research , very anecdotal and not supported by Nielsen/IRI scan data. The reality is that while private label quality is improving somewhat, there is no meaningful financial incentive to purchase private label. Factor in specials, Coupons, 10 for 10 promotions etc. and branded products are the same price or even a better value without the stigma of private label. IMHO
    16 Apr 2013, 10:41 PM Reply Like
  • Depends entirely on the product category. While some private label products are equivalent to their branded counterparts (e.g., milk, natural cheese), other product categories test significantly different with consumers even in blind tests.
    16 Apr 2013, 10:42 PM Reply Like
  • There will always be people like my mother-in-law who will always buy the name brand products no matter what the price difference is. She says it's just better.
    17 Apr 2013, 12:05 PM Reply Like
  • C'mon! It's not all about "taste" and "marketing". The discussion seems to avoid the "nutrition" argument as it pertains to both taste and marketing. Our nation goes waddling along the path toward continued and growing Obesity, Diabetes, Heart Disease and Cancer choosing to ignore the real implications of how nutrition is presented to us by Farm inc. and the Food industry in general. It's kind of like religion. You either choose to ignore it or you pick a side to be on. Presumably, no market wants to alter their meat and dairy mentality in favor of longevity. But any cursory review of Colin Campbell's "The China Study" that addresses the impact of bad nutrition on the American health system can't help but bring some marketing closer to achieving better options for us all. That said, I do see some attention given to "choices" being made by a few of our local grocers here on the West Coast. WFM seems to have gotten that notion started out here and there seems to be a slowly growing awareness of nutrition so all is not lost ... yet. Tighter and more accurate labeling would be nice. And, no ... I'm not 100 percent vegan. O.K. off rant.
    17 Apr 2013, 12:54 PM Reply Like
  • as far as health goes, i believe that one shouldn't eat dairy, gluten or
    any meat except omege 3 rich fish (and this on rare occasion). not to mention sugar.

     

    as far as business goes, it would be a disaster for food companies if people started eating brown rice and beans :). not to mention just how profitable obesity is for the health care industry.
    18 Apr 2013, 08:05 AM Reply Like
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