Featured in PLMA’s e-Scanner March 25, 2023 newsletter, created by Tom Prendergast, Director, Research Services
Throughout store brands' steady double-digit gains of 2022, which has continued through the first two months of this year, fully 16 of the 17 departments tracked by IRI showed store brand improvement.
One department demonstrated particularly strong sales performance -- Beverages -- a section once considered impenetrable for store brands due to the powerhouse national brands that inhabit it.
But that dominance may be changing. In this extremely competitive department, store brands have been growing at a faster pace than brands for the past 4, 12 and 52 weeks, reported IRI Unify exclusively to PLMA.
The numbers deserve a toast. Total private label beverage sales in 2022 were $12 billion and dollar sales grew by 19.3%. Double digit growth continued into the new year as dollar sales over the past four weeks totaled 18.6%, only a slight dip from the 20% sales growth in the past three months.
The Beverages department is the third largest of the 17 tracked by IRI when it comes to national brand and store brand dollar sales ($130B) and second largest in unit sales with over 40 billion in sales.
The largest category in beverages is bottled water. The category has sales of $6.8 billion in 2022 and dollar sales growth of 23.1%. While dollar sales did slow, from 21.3% over 12 weeks to 20.3% in the past four weeks, it remains the largest dollar sales category in the department.
Water is not the only growth category in this department. When you take a closer look at other areas you see while not everyone is showing growth but the ones gaining sales are especially strong.
For instance, carbonated beverages have increased from 15.8%-dollar sales growth last year to 32.4% in February and 28.9% over the past three months. This growth is also reflected in unit sales, as sales for carbonated beverages grew 4% in the past 4 weeks and 1.2% over the past 12 weeks. While unit sales did dip 2.5% last year, like dollar sales, sales of units of carbonated beverages continued to advance.
Two other growing categories over this period were refrigerated tea/coffee and tea bags. Refrigerated tea/coffee grew from 8.2% in dollar sales last year to 10.7% in the past four weeks. Tea bags had even more dramatic results, as dollar sales went from 5% in 2022 to 12.3% in the past three months to 17.5% in the past four weeks.
Other categories also stood out. These include bottled juices (10%), coffee (15.4%) and ready to drink tea/coffee (15.8%); all had double digit growth in 2022. In the past four weeks, while growth has slowed, it remains positive, ranging from 66.8% for ready to drink tea and coffee to 13.9% for coffee and 10.2% for bottled juices.
Unit sales improvements were also striking. Ready to drink tea/coffee saw units rise from 10.4% in 2022 to 84% over the past 3 months and 75.7% in the past 4 weeks. Coffee unit sales were up 2.8% last year but kept most of that growth in the past four weeks with a 2.5%-unit sales growth.
After decades of being a bottom shelf afterthought in a strong national branded department, store brands are evolving to become a presence if not a player in many parts of the huge Beverages sector.
To find out more IRI Unify data is available to all PLMA members and can be found at plma.com where these statistics and sales of 317 categories and 967 subcategories can be found.