Conventional thinking says that consumers buy more private-label CPG products in hard times, then return to their favorite and higher-priced national brands once the economy improves. A new study indicates it may be different this time.
Four of ten consumers (39%) polled by research firm Accenture say they bought more store brands in recent years as a result of the tough economic times. But two of three of them (64%) admitted that their grocery carts were still at least half full of store-brand products.
The study concludes that the growing perception of trust, quality and preference for private-label products should be of most concern to consumer goods companies that are competing with stores for the same shelf space. Half of consumers (50%) surveyed buy store-brand products because they perceive the quality to be just as good as the brand-name equivalent, 42% buy a private-label product because they “trust” that particular store’s brand, and 28% simply prefer the store-brand product to the brand-name product. In fact, only 9% claimed not to buy store-brands because they felt that the quality or taste was inferior to the brand-name product.