UK shoppers are becoming increasingly positive about retailers’ own-brand products
A new study by global information and insights company Nielsen suggests that UK shoppers are becoming increasingly positive about retailers’ own-brand products - particularly premium versions - contributing to a rise in sales.
According to the study, own-brand products accounted for 54% of UK supermarket grocery sales in the year ending 21 June 2014, while sales of premium own-brand products grew 5.2% year-on-year, at nearly 4=four times the rate of overall grocery sales, which was 1.4%.
The Nielsen Global Survey of Private Label, which polled more than 30,000 internet respondents in 60 countries, found that six in ten Britons said the quality of most own-label brands is as good as 'name' brands – nearly twice as many (34%) as four years ago. Furthermore, 42% said some own-brands are actually of higher quality than name brands. The report also found that half of Britons would now buy more own-brand products if a larger variety was available.
The health and beauty category was actually found to have the lowest concentration of own-brand sales, at just 18%. However, among the 33 product types covered in Nielsen's survey, Britons were most willing to pay higher than average prices for toothpaste (32%), shampoo (30%), mouthwash (16%) and deodorant (27%) - all categories taken care of by, and synonymous with, big industry players, explaining why own-brand is yet to break through in beauty and personal care.
Nielsen UK's Head of Retailer and Business Insight, Mike Watkins, highlighted: "Even in categories where own-brand products have their lowest share of sales, as in beauty, they still have a healthy – and growing – slice, explaining that the growth of premium own-brand offerings, which tap into shoppers’ increasing unwillingness to compromise over quality, means many own-brands are now a credible alternative for more and more items in today’s shopping baskets.” He added: “The perception of own-brand products has improved dramatically in recent years. As with manufacturer brands, retailers have, over time, successfully built equity into their own-brand products by investing in product innovation, further developing ranges and increasing marketing activity. Britons have a much greater appetite for own-brand groceries than shoppers in other markets around the world. While most grocery sales in the UK are own-brand, in North America, it’s less than 20%; in developing countries, such as China, India and Brazil, it’s less than 5%; and in the Middle East, it’s no more than 1%.”