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As consumers become more familiar with their own grocery brands, supermarkets have a prime opportunity to drive penetration of store brands, especially those that shoppers particularly like, according to a new report.
Bain & Company found that HEB, Costco’s Kirkland Signature, Whole Foods Market’s 365, and Trader Joe’s and Sam’s Club’s Member’s Mark were the “most loved” private brands overall, with surveyed consumers saying these brands were all good. They responded that they provide value and quality. The report is based on a survey of more than 20,000 U.S. consumers and uses proprietary consumer “love” scores.
Trader Joe’s, HEB and Kirkland Signature received high marks for both central stores and perishables. Some brands score highly in certain categories. Amazon Fresh performed well in central stores, while Publix and 365 shined in the perishable goods category.
Among consumer ratings for best quality, taste and value; Consistently low prices; ‘Products I want’ and ‘Most loved’ private brands beat domestic brands and other store brands, indicating that the loved lines contain strong and positive consumer sentiment.
Consumer awareness of “most-loved” brands is up to 18 percentage points higher than other store brands, and these brands are growing awareness through consistent marketing that demonstrates their value proposition, Bain said. For example, Trader Joe’s utilizes quirky branding with quirky packaging, while HEB expresses Texas pride through its message that it is the best grocery store in Texas. Here’s how Kirkland Signature compares to national brands.
According to the report, grocery stores that stock brands that consumers already “favorite” increase loyalty and share of wallet. Strong customer advocacy is a key factor in driving brand success because it leads to higher wallet share, Bain said.
Although most shoppers in the U.S. already perceive private brands to offer better value and lower prices, Bain said grocery stores can increase people’s perceptions of originality, quality and reliability. These three areas showed more relevance to big brands in consumer research.
Developing and delivering fan-favorite brands is especially important, with 80% of consumers saying they will continue to reduce overall spending this holiday season, according to the report. This is what makes traditionally affordable private grocery brands such an attractive option.
The festive atmosphere of the winter holidays provides an opportunity for supermarkets to showcase high-quality private brands to build consumer loyalty with the aim of becoming the “most-loved” brand, the report noted.
Despite the abundance of retail stores and supermarkets target, grocery store and hook Despite launching new food brands this year, private brand penetration in the U.S. still has plenty of room to grow. Bain said the average private brand penetration in the food sector is about 22% in the United States. That lags European grocery stores’ penetration of about 30% and 35%, Bain said.
