Private Label Food and Drink - UK - November 2013
“Tesco’s October 2013 relaunch of its premium tier Finest range should provide a boost to premium own-label NPD. Such innovation should be well placed to chime with the ongoing rise in consumer confidence and to tap into the predicted increase in consumer spending.”
– Amy Price, Senior Food and Drink Analyst
Some questions answered in this report include:
- Can investment in premium private label tap into growing consumer confidence?
- How are brands with the strongest image staving off private label competition?
- Where does private label dominate and what categories is it expanding in?
- How can the private label market engage with ABs and higher earners?
The UK private label food and drink market is estimated to have reached £50 billion in 2013, a 19% increase since 2008. This growth was broadly in line with the wider market, which grew by 20% over the same period.
While brands remain the most widely used type of food and drink product, standard own-label is only slightly less popular. Almost seven in 10 consumers use both branded and own-label food and drink, highlighting the extensive crossover in usage and the integral role that private labels play in consumers’ repertoires.
Ongoing NPD (New Product Development) activity by private labels has been noticed by the vast majority of consumers who cite an improvement in both the quality and packaging of own-labels, helping to alleviate any residing negative perceptions. This should stand the sector in good stead in the improving economic climate; while consumers are still adopting some recessionary habits, encouraging consumers to trade up across tiers will be key to driving value growth in the private label market once consumer spending regains momentum.
Brands are fighting back, accounting for the majority of NPD in the first nine months of 2013 and investing in marketing to drive consumer engagement as seen with Walkers’ resurrected Do Us a Flavour campaign and Coca-Cola’s Share a Coke activity.
Manufacturer brands: products which are available in most grocery stores and can be brand leaders or secondary brands. Examples include Heinz, Kellogg’s and Mars.
Private label: brands which are controlled and managed by retailers, carrying either the retailer’s name or an exclusively created name. This group includes tertiary/venture brands which are exclusively made for a retailer such as Tesco’s Parioli and Llama’s brands.
Own-label: products which carry the retailer’s name, with sub-brands segmented according to considerations such as health and price. Examples include Waitrose’s LOVE life range and Asda Chosen by You.
Premium own-label: products positioned towards the higher end of the price spectrum and looking to compete with brands in terms of quality. Examples include The Co-operative’s Truly Irresistible, Sainsbury’s Taste the Difference and Morrisons M Signature ranges.
Standard own-label: products positioned as retailers’ core range with a mid-tier price (undercutting brands by round 20%), generally covering the majority of product markets. Examples include Sainsbury’s and Tesco.
Value/economy own-label: products positioned at the lower end of the price spectrum, serving as the opening price point in each category. Examples include Tesco Everyday Value and Waitrose essentials.
This report focuses on private label food and non-alcoholic drink although the market size includes sales of food, non-alcoholic drinks and alcoholic drinks.
What you get
This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.
Mintel provides a range of market information, frequently through the category level, including market size and forecasting, complete with market drivers that illustrate the forces that shape a category or market.
Mintel's proprietary consumer research provides our analysts with the attitudinal and behavioral data used to provide valuable insight to topical issues.
Mintel provides overviews of the top brands and manufacturers, and uses consumer research to explore attitudes and reactions to brands, as well as insight into what will resonate with consumers.
Market reports provide appendices of data to support the research and insight produced. Our tables of data are easily manipulated and downloadable to support your research needs and covers factors from consumer attitudes to market forecasts.
* This is a sample representation of the report layout and does not reflect the research included in this report.
Why buy from us?
Our reports will provide you with market data, consumer research and competitive intelligence to succeed in your market.
Buy now and you'll have instant access to the information you need to make the right decisions.
Find out what's next in the markets that matter to you: where opportunities lie and what challenges you will face.
A business Superbrand, Mintel is a source you can trust. We have been defining and refining the Market Intelligence mix since 1972.