The trend: As more shoppers prioritize value over name recognition by choosing private label brands, national consumer packaged goods (CPG) brands are looking to boost their appeal without lowering prices.
How we got here: As production and distribution costs began rising, CPG companies adopted a number of tactics to protect their margins, opening the door for private label brands to steal market share.
The rise of private label: High gas and food prices coupled with changing consumer perceptions of private label products enabled store-owned brands to thrive. At the same time, retailers are doubling down on private labels to increase revenues and keep shelves stocked.
Changing tactics: As shoppers dip into their savings to cope with higher prices, companies need to appeal to consumers in different ways.
Looking ahead: The Consumer Brands Association, a CPG trade group, warned in May that “price increases are now an unavoidable outcome” for the industry. As more people are forced to cut costs wherever they can, private labels’ market power will continue to grow.
Go further: For more on private label brands, read our latest report here.
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