Private Label Food and Drink - UK - November 2013
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“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:
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.
This report will give you a complete 360-degree view of your market. Not only is it rooted in robust proprietary and high-quality third-party data, but our industry experts put that data into context and you’ll quickly understand:
What They Want. Why They Want It.
Who’s Winning. How To Stay Ahead.
Size, Segments, Shares And Forecasts: How It All Adds Up.
New Ideas. New Products. New Potential.
Where The White Space Is. How To Make It Yours.
What’s Shaping Demand – Today And Tomorrow.