Shoppers Turning to Retailers for Innovative New Products

Jun 04, 2007, 01:00 ET from The Private Label Manufacturers Association

    NEW YORK, June 4 /PRNewswire/ -- Searching to find new products that
 are innovative and exciting, more and more American consumers are turning
 to a new but trusted source for these products . their favorite retailers.
     For decades, consumers relied on the leading national brand
 manufacturers to supply these products. In recent years, though, shoppers
 are finding that these new items aren't meeting their needs. Last year
 33,000 new products were introduced in the U.S. and about 80% of them were
 soon dropped because of poor sales, according to Mintel, a market research
     America's retailers are moving in to fill the void with a steady stream
 of new grocery, health and beauty and home products. One of the latest
 major introductions is the Simply enjoy(TM) line, which is debuting in New
 England at Stop & Shop supermarkets and in Virginia, Maryland, Delaware,
 Pennsylvania and Washington, D.C. at Giant Food stores.
     The products offer "everyday luxuries at affordable prices," the
 retailers say. The line includes frozen entrees, appetizers and gourmet
 desserts, as well as dry grocery and dairy. The products are made with
 premium ingredients such as Italian durum wheat semolina, Dungeness crab
 from the Pacific, olives from Spain, Belgian chocolate, and real fresh
     "The Simply enjoy line of products is the latest example of store
 brands that are clearly moving to a higher level of quality and consumer
 acceptance," says Brian Sharoff, President of the Private Label
 Manufacturers Association here. Private label products, or store brands,
 are items that an individual retailer markets under its own name or brand.
 They are sold only at that chain's stores.
     Sharoff believes there are three main reasons why the success rate of
 new products is much higher for store brands. "One, the retailer owns the
 shelf and can keep products in stock longer; two, the retailer is closer to
 shoppers and understands their needs; and three, retailers can very quickly
 produce products in growth categories that tap into changing tastes and
     The success of new store brand products has attracted the attention of
 one of the world's biggest marketers-Disney. It has joined forces with the
 nation's largest supermarket chain, Kroger, to introduce a line of store
 brand products. Kroger and Disney have launched a line of 100
 health-oriented items under the Disney's Magic Selections name that are
 sold exclusively in Kroger stores.
     But the sizzle of private label extends beyond traditional food these
 days. Mass merchandiser Target has opened a new Bath & Body department
 which includes 20 of its own brands. The largest wholesale club operator,
 Costco, has launched 112 products in its Office Impressions line of office
     The reasons underlying the success of these new private label products
 are documented in a recent nationwide survey conducted for PLMA by Ipsos
 MORI, a leading opinion polling organization.
     The research found that the popularity of private label grocery
 products is clearly growing among American shoppers. In fact, 41% of
 shoppers now identify themselves as "frequent" buyers of store brands. The
 results were higher than five years ago, when 36% of respondents described
 themselves that way, and significantly higher than 15 years ago, when only
 12% called themselves frequent buyers.
     In addition, the survey found that almost half of consumers are more
 aware of private label products than five years ago and are more willing to
 buy them. Moreover, nearly two-thirds of respondents say they would buy
 more private label in the year ahead if their stores stocked a wider
 variety of products.
     The Ispos MORI research also revealed:
     -- Consumers in the middle-income (($30,000-$75,000) and high-income (over
        $75,000) brackets are much more likely to buy a larger amount of
        private label in the coming year than those in the low-income (under
        $30,000) bracket.
     -- Almost half of those interviewed said their regular shopping basket now
        contains one-quarter or more store brand products.  For all consumers
        in the study, the average amount of private label they buy is 32%.
     -- The popularity of grocery store brands is spreading a halo effect to
        non-grocery private label products in trade channels apart from
        supermarkets. About one-fifth of consumers  said they frequently buy
        private label products in the health and beauty, home office,
        household, and home improvement categories.
     "The research clearly points to the growing awareness and popularity of
 store brands," says PLMA's Sharoff. "It also continues to show a
 fundamental change in attitude toward private label products."
     The Private Label Manufacturers Association (PLMA) represents more than
 3,000 companies around the world and offers trade shows, programs and
 services for its members and retailers. For more information about the
 association, contact PLMA at (212) 972-3131 or visit the association online
 Available Topic Expert(s): For information on the listed expert(s), click
 appropriate link.
 Brian Sharoff

SOURCE The Private Label Manufacturers Association