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The Private Label Food Consumer - UK - November 2014

“Own-label is largely absent in single-serve chocolate products, meaning that it is missing out on impulse buying for on-the-go and out-of-home occasions – a key snacking occasion – indicating this as a potential area for own-label growth.”
– Emma Clifford, Senior Food Analyst

This report looks at the following areas:

  • Opportunities for the development of own-label within chocolate to develop in through the impulse channel
  • Supermarkets can do more to engage with their shoppers in-store to give them an edge over brands
  • Brands need to prove their worth in order to benefit from the expected rise in consumer spending in the mid-term

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Table of contents

  1. Introduction

      • Definitions
        • Abbreviations
        • Executive Summary

            • The market
              • Figure 1: Retail value sales and forecast of private label food and drink, UK, 2009-19
            • Market factors
              • The squeeze on real incomes continues
                • Figure 2: Annual % change in average total earnings, consumer prices (CPI) and food RPI, January 2009-August 2014
              • A drop in food and non-alcoholic drink prices
                • A ‘savvy shopping’ mentality has become ingrained
                  • Companies, brands and innovation
                    • Brands overtook private label in NPD activity in 2013
                      • Figure 3: New product launches in the UK food and non-alcoholic beverages markets, branded vs private label, 2010-14
                    • A third of food and drink adspend is by the grocers
                      • The consumer
                        • 85% of adults buy own-label
                          • Figure 4: Purchasing of own-label and branded food and non-alcoholic drink, September 2014
                        • A stark difference in taste perceptions between categories
                          • Figure 5: Products perceived to be tastier, selected categories, brands versus own-label, September 2014
                          • Figure 6: Consumers willing to pay more for branded products, by category, September 2014
                        • Price and quality hold most sway
                          • Figure 7: Factors which would encourage consumers to buy or to buy more own-label food and/or non-alcoholic drink instead of branded ones, September 2014
                        • Copycat own-label products divide opinion
                          • Figure 8: Attitudes towards own-label and branded food and non-alcoholic drink products, September 2014
                        • What we think
                        • Issues and Insights

                            • Opportunities for the development of own-label within chocolate to develop in through the impulse channel
                              • The facts
                                • The implications
                                  • Supermarkets can do more to engage with their shoppers in-store to give them an edge over brands
                                    • The facts
                                      • The implications
                                        • Brands need to prove their worth in order to benefit from the expected rise in consumer spending in the mid-term
                                          • The facts
                                            • The implications
                                            • Trend Application

                                                • Trend: Collective Intelligence
                                                  • Trend: Experience is All
                                                    • Trend: The Nouveau Poor
                                                    • Market Drivers

                                                      • Key points
                                                        • The squeeze on real incomes continues
                                                          • Figure 9: Annual % change in average total earnings, consumer prices (CPI) and food RPI, January 2009-August 2014
                                                        • Special offers remain a key draw for shoppers
                                                          • Figure 10: Grocery shopping habits people are doing more of this year than last year, September 2014
                                                        • Does an improved economy bode well for brands?
                                                          • Premium own-brand to benefit as spending gains momentum
                                                            • Brands are under pressure to step up their game
                                                              • Value ranges look set to suffer
                                                                • Strong demand for eating out challenges ‘dine in’ products
                                                                • Who’s Innovating?

                                                                  • Key points
                                                                    • Brands overtook private label in NPD activity in 2013
                                                                      • Figure 11: New product launches in the UK food and non-alcoholic beverages markets, branded vs private label, 2010-14
                                                                    • A sharp contrast in private label NPD activity across categories
                                                                      • Figure 12: Share of private label in new product launches of food and non-alcoholic drink products in the UK, by product category, 2014*
                                                                      • Figure 13: Percentage point change in the share of private label in new food product launches, by product category, 2013-14*
                                                                      • Figure 14: Percentage point change in the share of private label in new non-alcoholic drink product launches, by product category, 2013-14*
                                                                    • Tesco stays at the top in terms of new launches
                                                                      • Figure 15: Share of private label launches in the food and non-alcoholic beverages markets, by company, 2010-14
                                                                    • M&S and Waitrose expand their range of ready meals
                                                                      • The discounters look to premiumisation
                                                                        • A drop in economy launches from own-label
                                                                          • Figure 16: Share of new product launches in the UK food and non-alcoholic drink market carrying premium and economy claims, own-label vs branded, 2010-14
                                                                      • Market Size and Forecast

                                                                        • Key points
                                                                          • Private label growth has an edge over brands
                                                                            • Figure 17: Index of UK retail value sales of private label and all food and drink, 2009-13
                                                                          • Steady value growth forecast
                                                                            • Figure 18: Retail value sales of private label food and non-alcoholic drink, at current and constant prices, 2009-19
                                                                            • Figure 19: Retail value sales and forecast of private label food and drink, UK, 2009-19
                                                                          • Methodology
                                                                          • Segment Performance

                                                                            • Key points
                                                                              • Milk is the only private label-dominated non-alcoholic drinks sector
                                                                                • Figure 20: Share of private label in sales of non-alcoholic drinks, by category, 2014*
                                                                                • Figure 21: Share of private label in sales of non-alcoholic drinks, by category, 2013 and 2014
                                                                              • Private label dominates milk as a commodity
                                                                                • Brands lead in bottled water
                                                                                  • Brands have a near-monopoly in CSDs
                                                                                    • A strong lead for own-label in ready meals and dips
                                                                                      • Figure 22: Share of private label in sales of food, by selected categories, 2013 and 2014
                                                                                    • Own-label is almost non-existent in baby food and drink and gum
                                                                                      • ‘Treat’ purchases tend to be the domain of brands
                                                                                      • Companies and Products

                                                                                          • Asda
                                                                                            • Market positioning
                                                                                              • Private label offering
                                                                                                • Recent activity
                                                                                                  • Co-operative Group
                                                                                                    • Market positioning
                                                                                                      • Private label offering
                                                                                                        • Recent activity
                                                                                                          • Morrisons
                                                                                                            • Market positioning
                                                                                                              • Private label positioning
                                                                                                                • Recent activity
                                                                                                                  • Sainsbury’s
                                                                                                                    • Market positioning
                                                                                                                      • Private label offering
                                                                                                                        • Recent activity
                                                                                                                          • Tesco
                                                                                                                            • Market positioning
                                                                                                                              • Private offering
                                                                                                                                • Recent activity
                                                                                                                                  • Waitrose
                                                                                                                                    • Market positioning
                                                                                                                                      • Private label positioning
                                                                                                                                        • Recent activity
                                                                                                                                          • Marks & Spencer
                                                                                                                                            • Market positioning
                                                                                                                                              • Private label positioning
                                                                                                                                                • Recent activity
                                                                                                                                                  • Discounters
                                                                                                                                                    • Aldi
                                                                                                                                                      • Lidl
                                                                                                                                                      • Brand Research

                                                                                                                                                        • Brand map
                                                                                                                                                            • Figure 23: Attitudes towards and usage of brands in the supermarket private label sector, August 2014
                                                                                                                                                          • Correspondence analysis
                                                                                                                                                            • Brand attitudes
                                                                                                                                                              • Figure 24: Attitudes, by supermarket private label brand, August 2014
                                                                                                                                                            • Brand personality
                                                                                                                                                              • Figure 25: Supermarket private label brand personality – macro image, August 2014
                                                                                                                                                              • Figure 26: Supermarket private label brand personality – micro image, August 2014
                                                                                                                                                            • Brand experience
                                                                                                                                                              • Figure 27: Supermarket private label brand usage, August 2014
                                                                                                                                                              • Figure 28: Satisfaction with various supermarket private label brands, August 2014
                                                                                                                                                              • Figure 29: Consideration of supermarket private label brands, August 2014
                                                                                                                                                            • Brand recommendation
                                                                                                                                                              • Figure 30: Recommendation of selected supermarket private label brands, August 2014
                                                                                                                                                          • Brand Communication and Promotion

                                                                                                                                                            • Key points
                                                                                                                                                              • A third of food and drink adspend is captured by the grocers
                                                                                                                                                                • Figure 31: Main monitored media advertising expenditure on food and non-alcoholic drink, 2010-14
                                                                                                                                                              • Tesco reclaimed its leadership in 2013
                                                                                                                                                                • Figure 32: Main media advertising expenditure on food and non-alcoholic drinks, by selected retailers**, 2010-14
                                                                                                                                                                • Figure 33: Share of main media advertising expenditure on food and non-alcoholic drinks, by selected retailers**, 2010-14
                                                                                                                                                              • Morrisons, Aldi and Co-operative Food grew adspend significantly in 2013
                                                                                                                                                                • Morrisons focuses on price 2014
                                                                                                                                                                  • Aldi
                                                                                                                                                                    • Co-op
                                                                                                                                                                      • Lidl unveils debut TV ad campaign
                                                                                                                                                                      • The Consumer – Usage of Own-label and Brands

                                                                                                                                                                        • Key points
                                                                                                                                                                          • 85% of adults buy own-label
                                                                                                                                                                            • Figure 34: Purchasing of own-label and branded food and non-alcoholic drink, September 2014
                                                                                                                                                                            • Figure 35: Purchasing of own-label and branded food and non-alcoholic drink, September 2013 and September 2014
                                                                                                                                                                          • Over-55s and ABs most likely to buy premium own-label
                                                                                                                                                                            • Figure 36: Purchasing of premium-own-label and branded food/non-alcoholic drink products, by age and socio-economic group, September 2014
                                                                                                                                                                          • Tesco is the most popular supermarket for own-label
                                                                                                                                                                            • Figure 37: Retailers from which own-label food/non-alcoholic drink has been bought in the last three months, September 2014
                                                                                                                                                                        • The Consumer – Taste Perceptions of Brands versus Own-label

                                                                                                                                                                          • Key points
                                                                                                                                                                            • A stark difference in taste perceptions between categories
                                                                                                                                                                              • Figure 38: Products perceived to be tastier, selected categories, brands versus own-label, September 2014
                                                                                                                                                                            • Own-label has more positive taste perceptions in bread and baked goods and pasta
                                                                                                                                                                              • Chocolate is the only category most shoppers are happy to pay more for brands in
                                                                                                                                                                                • Figure 39: Consumers willing to pay more for branded products, by category, September 2014
                                                                                                                                                                            • The Consumer – Enticements

                                                                                                                                                                              • Key points
                                                                                                                                                                                • Price and quality hold most sway
                                                                                                                                                                                  • Figure 40: Factors which would encourage consumers to buy or to buy more own-label food and/or non-alcoholic drink instead of branded ones, September 2014
                                                                                                                                                                                • Low price appeals but not at any cost
                                                                                                                                                                                  • Quality chimes in particular with ABs
                                                                                                                                                                                    • In-store tastings appeal to a third of shoppers
                                                                                                                                                                                      • Choice and innovation can drive purchasing of own-label
                                                                                                                                                                                        • Importance of recommendations from trusted sources
                                                                                                                                                                                        • The Consumer – Attitudes towards Own-label and Brands

                                                                                                                                                                                          • Key points
                                                                                                                                                                                            • Copycat own-label products divide opinion
                                                                                                                                                                                                • Figure 41: Attitudes towards own-label and branded food and non-alcoholic drink products, September 2014
                                                                                                                                                                                              • Under-25s are most inclined to buy brands when treating themselves
                                                                                                                                                                                                • Low cost enables trading up
                                                                                                                                                                                                  • Own-label has more sway over shopping habits than brands
                                                                                                                                                                                                    • Opportunities for the development of own-label in the convenience channel
                                                                                                                                                                                                    • Appendix – Market Size and Forecast

                                                                                                                                                                                                        • Figure 42: Best- and worst-case forecasts for private label, by value, 2014-19

                                                                                                                                                                                                    Companies Covered

                                                                                                                                                                                                    To learn more about the companies covered in this report please contact us.

                                                                                                                                                                                                    The Private Label Food Consumer - UK - November 2014

                                                                                                                                                                                                    £1,995.00 (Excl.Tax)