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Albertsons’ CEO said Tuesday that he believes sales of its own brands will expand to up to 30% of its business as the supermarket operator continues to take steps to connect with price-focused shoppers.
In Albertsons’ second-quarter earnings call, CEO Susan Morris said the company saw unit sales growth across its portfolio of private brands during the latest fiscal quarter, in part due to the introduction of new products in several categories that “deliver exceptional value to our customers.”
Albertsons “continues to invest through a balanced approach of enhanced loyalty, progressive and personalized promotions, competitive pricing actions and supplier financing,” Morris said. The company added that it also reduced prices in certain categories and markets to help people save money during the quarter.
According to Morris, Albertsons’ efforts suggest it is on a path to increase private label penetration above its current level of about 25%. Private label penetration in grocery stores was 25.7% during the first quarter of fiscal 2025 and 25.4% during the last quarter of the last fiscal year.
The company’s recent actions “are designed to increase customer engagement and loyalty while contributing to margin growth through improved mix and merchandising,” Morris said.
“We believe that by increasing the visibility and appeal of our brands, we can drive large-scale growth in critical areas of our business, strengthening our competitive advantage and long-term profitability,” she added.
Morris noted that shoppers took steps to save money during the second quarter, including increased coupon use and shorter shopping lists. The company has also seen customers focus on healthier eating habits, a trend that’s driving sales of items like fresh meat and produce and increasing Albertsons’ margins, she said.
“The pressure is on, and we’re working hard to give our customers what they want, in a way that fits their budget, market by market,” Morris said.
