Supermarkets: Private label push despite modest price increases – Economic Courier

More and more… Europeans have started to become the consumers in our country in terms of their visits to supermarkets, turning their backs on branded products.

Supermarkets: 3% increase in turnover in the first quarter, Nielsen research shows

So despite the declining rate of price growth in recent months, cheaper private label products seem to not only be consolidating their important position in the household basket, but also increasing it.

In more detail, based on NielsenIQ data, the share of “anonymous” products continues its upward trajectory and from 24.7%, which was at the end of 2023, reached 25.4% during the first quarter of the year.

Faced with the gallop of “unbranded” products, manufacturers and importers of branded products are trying to become even more competitive by further strengthening their promotional intensity, from 68.7% at the end of last year to 69.8% in first quarter of 2024.

In any case, promotions are more or less a one-way street for the industry as well as for the organized retail sector, as based on the latest NielsenIQ Shopper Trends survey, 9 out of 10 shoppers are influenced by promotions when they need to make a decision about brands or even the stores they choose for their purchases.

Revaluations are restrained but accuracy remains

PL products which have deftly masked the fact that their prices have gone up more than the brands, thus maintaining their status as a more family budget friendly option, is a way out for consumers, who continue to be tormented by accuracy despite the restraint of revaluations.

It should be noted that in March food inflation in Greece was the second highest among Eurozone member countries, according to data on the harmonized index of consumer prices published by Eurostat.

Specifically, at the level of the Eurozone, food prices in March increased annually by 1.7%, while in Greece in the same month, food inflation stood at 5.4%. Only in Malta was the relative index higher (6.2%).

From the private label 32% of the turnover of the supermarkets

From the retailers’ point of view, private label is a category they “love to hate” because they can’t get the benefits they get from brands while they have limited profit margins to maintain their edge over brands. products.

The participation of private labels in the turnover of fast-moving goods sold by supermarkets now reaches 18% according to retailers, while if fresh products (fruits, vegetables, meat) are added, the share jumps to 32%.

Based on Circana data, in the food category private label sales by value had a sales share of 27.2 units in January this year when in 2022, at the beginning of the inflation crisis, they had 26.3 units.

The biggest change is observed in personal hygiene and care products and home care products (cleaners, detergents, etc.).

In particular, the share of private label products in the personal hygiene and care category from 20.2 units in 2022 reached last January to 22.1, while in terms of home care products from 25.5 units in 2022, in this January it reached 27.6.