Click here to view PLMA’s 2021 Private Label Yearbook. Summary and topline reports for store brands sales and market share by channel and region are based on NielsenIQ scan data for the 52 weeks ending 12/26/21.
NEW YORK—As the pandemic brought unparalleled volatility to U.S. grocery purchasing in 2020, consumers continued to favor store brands for about one of every four purchases across all major food and nonfood categories based on the industry’s latest annual sales data, says the Private Label Manufacturers Association.
According to PLMA’s 2021 Private Label Yearbook, retailers’ private brands accounted for 23.4% of all units sold last year in NielsenIQ’s calculation of all outlets combined, which includes total U.S. supermarkets, mass, club, and dollar channels, as well as drug chains. About one out of every five dollars expended by shoppers in all outlets, or 19.5%, was for the retailer’s store brand. Both figures were unchanged from the market shares reported for the full year prior to the pandemic. The year 2020 saw COVID-related retail impacts that ranged from panic buying early on to the near doubling of online purchases over 2019 sales. Yet store brands sales saw an increase of +12% for the year, keeping pace with national brands and maintaining market share, despite a number of supply chain interruptions affecting high demand categories, and a major shift of purchasing from foodservice to grocery channels as consumers everywhere were forced to adjust their lifestyles around remote schooling and work, and many households were confronted with the loss of income or livelihood.
“Analysis needs to take these anomalies of the 2020 data into account,” cautioned PLMA president Peggy Davies, “but comparisons to pre-pandemic trends and projections notwithstanding, store brands maintained their well-established position in the marketplace, as retailers and private label manufactures succeeded in supplying the country with critical food and essential non-food products in the face of extreme volatility. The 2020 sales figures bear that out.
”NielsenIQ data show retailers’ store brands surged across all outlets for a record $158.8 billion in private label sales, even as sales for all brands reached a record $816 billion. Private label units also saw an increase of +7.2%, matching the growth of all brands. Private label’s market share for all outlets remained steady at 19.5% of sales volume and 23.4% of all units sold. In the mass channel, consisting of mass merchandisers, club and dollar stores, PLMA calculates store brands sales increased by $8.1 billion (+11.7%) to a total of $77.8 billion, and store brands unit volume was up +8.2%. Both measures outpaced the mass channel overall, where manufacturers brands saw gains of +8.5% in dollars and +4.9% in units. As a result, store brands shares increased to 21.5% (+0.5 percentage points) of total dollar sales and 25.5% (+0.6 percentage points) of all units sold.
In U.S. supermarkets, which for a number of years had only moderate, mostly inflationary sales growth and declining unit volumes, 2020 brought a reversal of trends and store brands factored significantly in the turnaround. Private label sales increased by $8.5 billion to a record $27.3 billion (+13.2%), while units were up +7.1%. Manufacturers brands fared somewhat better however, as the channel overall captured a +16% sales increase to a record $403.6 billion overall in tandem with a unit volume gain of +9.4%. Private label had lower annual shares in the channel as a whole, at 18.1% of dollars (-0.4 percentage points) and 22.3% of units (-0.5 percentage points).
The drug channel fared less well than others, reporting $130 million lower store brands sales (- 1.7%) against a loss of more than -6% unit volume for all brands sold in the channel vs a year ago. National brands sales increased +0.8%—an indication that price inflation may have been a factor as private label market share for units remained unchanged at 15.7%, while dollar share declined -0.3 percentage points to 15.9%.
NielsenIQ’s Kara Sheesley, vice president retail engagement and U.S. industry relations, cited household panel data for 2020 as proof that purchasing private label is ingrained in U.S. consumers’ behavior: “Fully 99% of households told us they bought private label last year.” Of note, the panel research data placed store brands market share for 2020 at 23% of all grocery dollars and 25% of units, by taking account of sales at retailers not counted within the point-of sale scan data universe. The figure includes additional private label sales of approximately $40 billion annually from consumer purchases at leading club, discount retailers and others with extensive private brand programs.