Store Brands Urged To Offer More Promos, Samples – And Coupons

Several recent reports have shown that store brand products are gaining in popularity, and not just because they’re cheaper. But there’s still a lot that grocers can do to get their products into shoppers’ carts. A new report recommends promoting them to make them more visible, offering samples to let customers try them – and offering coupons to help store brand buyers save even more.

FMI – The Food Industry Association is out with its annual Power of Private Brands report. While private label products may be more popular than ever, the report says now is not the time for retailers to rest on their laurels.

92% of grocery shoppers told FMI that they have store brands in their homes, up from 89% last year. Only 1% of shoppers said they “never” purchase store brands. Half said they have been buying more store brands over the past year, with most saying they’ve done so because they are a good value or are less expensive, with attributes like good taste and quality further down the priority list.

Store brands are “worth the value during these hard times,” one shopper told FMI. “They are a great deal and taste just as good,” another said. A third shopper called store brands “solid, dependable, and often underrated.”

That corresponds with data from Circana, which found that private label sales have increased at a faster rate than national brands over the past year. But Circana also found that private label’s explosive growth is leveling off.

So FMI has ideas.

“The industry has opportunities to elevate marketing and merchandising to further spread the word,” the report noted. When asked what influences them to choose a particular brand, shoppers said recommendations from family and friends is tops, with the availability of coupons and promotions close behind. So FMI suggests leveraging these findings by “developing partnerships with influencers,” offering samples in stores to help encourage trial, and offering more coupons and deals to get cost-conscious shoppers’ attention.

Stores have been encouraged recently by findings that shoppers are actively seeking out their private label brands, and not just because of price. While price remains the primary factor in making store brands attractive, FMI found that “taste, quality and packaging have advanced as reasons for buying private brands, an indication of growing momentum for non-price factors.” And while shoppers gravitate toward store brands that are less expensive than their name brand equivalents, FMI found that “premium and better-for-you” categories “were strong runners-up.”

That said, there are still store brand products that shoppers stubbornly won’t buy. The most popular private label products include fresh bakery items, milk or non-dairy substitutes and baking/cooking items. But some shoppers said there are certain categories where they insist on sticking to name brands, such as cereal, ketchup, soda, coffee and toilet paper.

When asked what motivates them to choose a brand in certain categories, shoppers said they’re most likely to buy whatever national brand is on sale when shopping for paper products, canned foods and condiments, instead of choosing the store brand.

The good news for grocers is that more than half of shoppers who do buy store brand products said they’re very likely to continue doing so even if grocery prices fall. That, FMI says, “indicates that shopper loyalty to these brands is strong and not based only on price.”

“Consumers aren’t just choosing store brands out of habit or necessity; they’re choosing them because they’ve earned the trust of American families,” FMI director of industry relations Tom Cosgrove said in a statement. “The food industry has worked hard to build that trust, and food retailers now have the opportunity to expand on it.”

And if they expand on it by offering more coupons – then value-seeking shoppers won’t have to choose between good products and a good price.

Image source: Schnucks