Price has always been private label's strong point, though that might be less of a factor today than in the past. According to a new report from J.D. Power and Associates, consumers like private label even more if the retailer's name is omitted from the package.
“The consumers we tracked saw them more as a stand-alone brand, rather than a store brand,” said Janet Eden-Harris, vice president of J.D. Power's Web Intelligence Division.
Private-label products from Safeway, Trader Joe's and Whole Foods Market received the most favorable mentions by consumers compared with other store brands. They are also got high marks for healthfulness and flavor.
“Across the board, consumers are increasingly enamored of organic,” Harris added. “They think the quality is better, but price has been a big barrier.”
What's different about this study is the method that was used to gauge consumer perceptions. Harris scanned tens of millions of blog posts from the past year and culled 50,000 that discussed private-label food brands.
“We're essentially listening in on spontaneous conversations,” she said. “As a result, what you get is an unadulterated, unfiltered response.”
The bloggers are passionate about the topic, as reflected in their writings. “They tend to be well educated on the topic and typically thought leaders in an industry space,” Harris added.
Of all the age groups monitored, so-called Gen Y is poised to fuel growth in the organic category in coming years. To them, the category beats conventional in quality and environmental impact, and — most importantly for retailers — is worth the higher price.
“The decisions they make and attitudes they develop during this period of time will likely stay with them as they get older,” said Eden-Harris.