Brand Strategy
Private Label: The Future of Retailing Is Here
- Private label brands are gaining global popularity, with over half of shoppers buying more store-brand products due to improved quality and better value.
- Retailers benefit from higher margins and consumer trust, while younger generations increasingly prefer private labels over national brands.
In today’s fast-paced retail landscape, Private Label—also known as store brands or own-label products—is no longer relegated to the bargain bin. Once seen as the generic alternative to national brands, private labels have undergone a remarkable transformation, gaining both quality and consumer trust.
Why Private Label Is Rising
Global sales of private�label goods climbed by 4.3�% year�on�year in 2024, according to . Meanwhile, global brands grew slightly faster (+4.8%), but the shift in consumer preferences remains clear. 53% of shoppers worldwide now say they’re purchasing more private-label items.
In the United States, private label sales rose by 4.1%, reflecting consumers� growing appetite for value without sacrificing quality. Further evidence comes from Food & Wine, reporting that 59% of U.S. shoppers trust store�brand products, especially when backed by retailers they know.
Quality: No Longer a Compromise
The success of private labels lies in closing the gap with national brands. Many items—especially pantry essentials like pasta, canned goods and frozen vegetables—are manufactured in the same facilities as big�name alternatives, often with identical ingredients. While prices are lower, quality remains high. In shelf�stable and frozen categories, store brands are now frequently preferred by consumers for taste and reliability.
Additionally, 75% of U.S. shoppers view private-label goods as offering good value, and 72% consider them strong contenders to national brands. This brand evolution has led to what marketing experts call the “brandification� of private label products marketed with premium packaging, innovative flavours, and sustainability credentials.
Regional Growth and Generational Change
Private label’s popularity isn’t confined to North America. In Western Europe, for example, store brands hold around 36% of market value, and total European sales reached �352 billion in 2024, with a 38.1% share of groceries.
Emerging markets are also catching up. Data show that 61% of German shoppers, 56% in India, 59% in Saudi Arabia and 56% in Colombia report buying more private label than ever. Millennials and Gen Z are particularly receptive; nearly 46% in each segment say they’d pay more for a private-label product they liked.
Strategic Opportunities for Retailers
The private�label boom offers retailers significant advantages. Holding exclusivity rights, brands can differentiate their offerings and foster customer loyalty. Higher profit margins are also possible—retailers set pricing, packaging, and positioning and can respond rapidly to market trends.
With inflation still a factor, major brands are tempering their price increases—nestling around 2�% in the U.S.—while private labels rose roughly 4�% on average. This cost gap has further propelled store�brand appeal.
Smarter Shopping Tips
For consumers, here are a few strategies to make the most of private�label purchases:
- Start with staples � pantry essentials are often near-identical to national brands, yet cheaper.
- Read the ingredients � you might be surprised to find the same recipe inside.
- Check unit pricing � private label isn’t always cheaper, especially with promotions.
- Try items one at a time � test small batches to find your favourites; many retailers offer flexible returns.
The Bottom Line
Private Label has evolved from budget backup into an essential element of retail strategy. It delivers value, quality and flexibility. Retailers benefit from higher influence and margins; consumers gain trusted everyday options. With global sales growing strongly and younger shoppers embracing store brands, the momentum shows no sign of slowing.
