Retail Merchandiser - May/June 2012 - (Page 6)

CATEGORY INSIGHT Food Loyalty Here’s a mystery: Sales of private-label food and beverages are still rising, but consumer satisfaction with them is dropping. A lthough the share of household servings of private-label food and beverage products increased from 18 percent in 2000 to 27 percent in 2011, consumer satisfaction with them dropped from 32 percent in 2009 to 24 percent in 2012. This is according to The NPD Group’s food and beverage market research report. Perhaps because they have been considered a necessity due to economic hardship and higher grocery prices, the appeal of private-label food and beverages may be waning, like the taste of medicine once one is feeling better. In NPD’s report titled “The Evolution of Private Label – Does Brand Name Really Matter?”, in 2009, 34 percent of adults said they intended to purchase more private-label food versus a year ago, but that percentage has dropped to less than 25 percent of adults in 2012. This does not mean that privatelabel products have not made progress over the last decade, the market research company reports – two-thirds of adults thought the store brands’ quality is much better today than it was five years ago. Private-label servings may be up but the intent to purchase more of them is down because consumers’ awareness of store brands’ names and identification with them remains low. For example, in the report, one-fourth of shoppers could not identify the top-selling store brand as a store brand. Not surprisingly, although the report found that more private-label end-dishes are being served, consumers are most loyal to private- label brands of ingredients, with flour and butter topping the list. Categories with stronger loyalty to name brands are very likely to display the brand to the user, such as frozen dinners and entrees, yogurt and carbonated soft drinks. “The question is if food inflation declines and at the same time the economy improves, will consumers return to the name brands they know and trust?” asks Darren Seifer, NPD’s food and beverage industry analyst and author of the report. “This could become a reality if retailers don’t respond to declining satisfaction, and if name-brand manufacturers continue to aggressively build loyalty. On the flip side, name-brands need to be aware that private-label usage continues to increase and the quality perception is improving.” O

Table of Contents for the Digital Edition of Retail Merchandiser - May/June 2012

Retail Merchandiser - May/June 2012
‘Push’ vs. ‘Pull’
Narrow Your Band
Celebrating in Style
Give a Little Something Extra
Charm City Cakes
LazyTown Entertainment
Binny’s Beverage Depot
Vallarta Supermarkets Inc.
Cintron Beverage Group
Total Wine and More
Golfsmith International Inc.
Barrow Fine Furniture
Hedahls Auto Plus
Kopp Drug Inc.
Grafton-Fraser Inc.
Intelligent Office Canada
A1 Counting Solutions
New & Notable
Focus on Licensing - May/June 2012
2012 Preview
Franchising Facts
Hello Kitty Charm
Playing It Up
Saban Brands Powers Up
Mars Retail Group
SEGA of America Inc.
Major League Baseball Players Association
Universal Partnerships & Licensing
Remington Arms Co.
Cartoon Network Enterprises
Hybrid Apparel
Agile Network
New & Notable

Retail Merchandiser - May/June 2012