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NEW YORK Ė How can supermarkets attract the newest generation of grocery shoppers, the much-publicized millennials, and turn them into loyal customers? Thatís probably the biggest strategic question facing retailers today and new research suggests that the answer may be found in the fresh departments along the store perimeter.
A nationwide survey of more than 1,800 shoppers by the Private Label Manufacturers Association reveals that millennials love food but want food done their way. Fresh and healthy foods are at the top of their shopping lists, while prepared and portable foods are also very popular.
These food choices reflect a distinctive way of eating. For millennials, eating is largely unscheduled. They incorporate food consumptionówhether meals, snacks or bitesóinto a range of everyday activities, ranging from work and play to exercise and commuting, according to the research in PLMAís latest report ďHow Americaís Eating Habits Are Changing.Ē
This new way of eating offers a significant opportunity for the supermarketís dairy, deli and bakery departments. While millennials purchase from many different sources, they frequently shop at supermarkets. And once inside the store they often head to these three departments. The study found that three-quarters of shoppers buy deli items in the supermarket where they do their regular grocery shopping, 77% buy dairy items and 59% buy bakery items.
Reflecting their on-the-go eating habits, one third ďalways or frequentlyĒ purchase heat-and-eat food from the supermarket, 29% pick up prepared or ready-to-eat food, and 27% buy grab-and-go prepared food items from a source such as a supermarket or convenience store. Millennials are a generation of nibblers and experimenters, so in-store sampling and demonstrations are popular.
Home or away, meals or snacks, this age group is drawn to all things fresh. On occasions when they eat at home, including meals and snacks, 57% of them ďalways or frequentlyĒ opt for fresh fruits, 35% for fresh baked bread products, 30% for fresh prepared meals and 30% for fresh and chilled deli salads.
The PLMA study indicates there is likely to be a big payoff for supermarkets who successfully adapt to the new eating habits of the millennials. Contrary to expectations, these shoppers are more loyal to their favorite stores than their parents. Nine of 10 do their regular grocery shopping in only one or two stores. This represents a dramatic departure from recent PLMA studies that saw consumers spreading their shopping among a multiplicity of stores.
This loyalty has important implications for store brands. As they select products, millennials are well informed about brands, including store brands, and where foods come from. Nine of 10 say they are aware of the ingredients in the food products they eat and three of four read the nutritional labels on products. Their awareness of store brands and national brands is virtually the same at 84% vs. 86%.
Commenting on these findings, Brian Sharoff, President of PLMA, said, ďStore brands remain the retailerís most potent weapon in developing strategies for this age group. It offers flexibility and opportunities to be creative with product assortment and concept without waiting for national brands. But it requires an understanding of what this age group likes and will buy.Ē
PLMA commissioned Surveylab to conduct a comprehensive, nationwide online survey of 1,839 shoppers (931 women, 908 men) between the ages of 20 and 29, primarily the core group of the Millennial generation. This demographic group represents upwards of 50 million Americans, or about 15% of the total population. In number of participants, this is the largest survey PLMA has ever commissioned in the U.S.
For additional information on the growth of store brands or to schedule an interview with PLMA President Brian Sharoff, contact PLMAís press representative at (212) 972-3131, or email firstname.lastname@example.org
NEW YORK - For retailers who march to their own drum, PLMAís 2016 Private Label Trade Show is the one and only industry event where the biggest and the best producers across every food and nonfoods category offer specialized manufacturing capabilities and expertise, exhibiting tens of thousands of products that will carry the retailerís brand.
As store brands continue to rack up new sales records across the major retail channels Ė surpassing $118 billion in the U.S. alone according to the latest industry data Ė the show continues to draw the largest attendance of store brands buyers in the Western Hemisphere. More than 4500 visitors will include buyers and executives from virtually every major supermarket and drug chain, mass merchandiser, club, convenience and specialty retailer, foodservice distributor and wholesaler.
Exhibits at the show have grown ten percent overall for the past two years, and with plans for nearly 2800 exhibit stands this November, the PLMA is projecting that 2016 is going to be another record year.
In two major exhibition halls companies offer foods and beverages that range from shelf-stable and frozen to chilled and fresh prepared foods Ė including fresh deli, dairy & bakery items. A third major exhibition hall is devoted entirely to nonfoods, including health and wellness products, beauty and personal care, over-the-counter pharmaceuticals, pet care, kitchen and household, paper and plastic, and general merchandise.
Joining manufacturers from across the U.S. on the trade show floor can be found international exhibitors and pavilions showcasing store brands products from nearly fifty nations, including Italy, Spain, Germany, France, Belgium, The Netherlands, Denmark, Greece, Turkey, Israel, India, China, Taiwan, Vietnam and South Korea, as well as from Canada, Mexico, Ecuador, Peru, Columbia, Chile and Brazil.
Trade show registration includes PLMAís program of Sunday seminars, a keynote breakfast on Monday and the PLMA Live! breakfast on Tuesday morning, presenting speakers, seminars workshops that focus attention on the most significant retail trends, latest consumer research and new store brands opportunities.
As retailers constantly seek to expand their private brands to new categories and marketing concepts, special exhibits like PLMAís New Product Expo put a spotlight on the newest submissions from exhibiting companies to help buyers navigate the enormous and diverse assortment of offerings on the trade show floor. In addition, PLMAís popular Idea Supermarketģ, showcases store brands programs, products and packaging from more than 50 leading retailers across North America, Europe, Asia and Latin America.
For information on attending or exhibiting at PLMA's Private Label Trade Show, contact PLMA (212) 972-3131 or email email@example.com
Store brands dollar share came to 17.7%, also the highest mark ever. Across all outlets combined store brands sales grew +2%, a performance that equaled that of national brands, which also rose +2%.
In unit sales, both store brands and national brands were off fractionally, less than a half percentage point each. Unit sales of store brands were almost 44 billion, nominally on par with last year. As a result, store brand unit share held at 21.1%.
The PLMA Private Label Yearbook compiles sales data provided by Nielsen for the 52 weeks ending December 26, 2015. The industry annual has become the benchmarking standard for retailers and suppliers. Nielsen sales and market share statistics are reported for more than 700 food and nonfood product categories.
Looking at supermarkets, total sales of store brands were $62.5 billion, roughly even with the prior year. Over a two-year period, sales are up in the supermarket channel by +2%, or $1.1 billion. With unit share at 22.9%, nearly one of every four items sold in the countryís supermarkets last year was a store brand. As for drug chains, store brand dollar sales rose nearly a percentage point to $8.4 billion last year, while national brands fell about a point.
Figures for all outlets come from total U.S. supermarkets with annual sales over $2 million, drug chains with annual sales over $1 million, mass merchandisers, club and dollar store channels, and military exchanges.
Looking beyond these traditional outlets and the data available from Nielsen, a more comprehensive figure for annual store brand sales in food and non-food consumables would include an estimated $20 billion or more in revenues from chains that range from no-frills discounters like Aldi and Save-A-Lot, to specialty chains such as Whole Foods and Trader Joeís, as well as convenience stores. If counted, these outlets would produce a grand total approaching $140 billion in sales.
Even that total does not take into consideration store brand products sold by chains specializing in office supplies; hardware, tools and do-it-yourself; home improvement, home decor and domestic goods; consumer electronics, baby care, pet care, toys, personal care and sporting goods. These are just a few of the non-grocery retail channels that are marketing a growing variety of store brand items.
Store brands continue to represent outstanding value for consumers. Shoppers could save an estimated $44 billion a year by buying store brand products over national brands, according to a recent study by the National Bureau of Economic Research, while market basket research by PLMA consistently reveals that shoppers can save about one-third on basic food and household items in a typical supermarket by opting for the store brand over national brands.
The yearbook is published exclusively online, and access is free to PLMA member manufacturers, brokers and suppliers. Retailers and wholesalers can gain free access to the data and analysis, including new updates every quarter, by logging in at www.askplma.com and following the prompts for Private Label Yearbook. PLMA members can access the online yearbook via PLMA's member services website at www.plma.org.
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