Titled “Stretching Food Benefits: SNAP Recipients Speak Out on Shopping & Store Brands,” the report was prepared for retailers by PLMA. It is based on data collected by Surveylab, a global leader in customized online research. A nationwide sample of more than 500 SNAP recipients participated.
Like most American consumers, SNAP recipients are strongly predisposed to store brands. About three in 10 purchase store brands at a high rate each time they use their benefits. However, an almost equal number buy national brands at the same rate, supporting the study’s conclusion that store brands have ample room to grow in terms of sales among SNAP participants.
Respondents expressed a very favorable opinion of store brands when asked to compare them to national brands on six important product attributes, rating them higher in five, including “quality” and “value.” Most recipients are careful shoppers. Eight in 10 “always or frequently” buy SNAP products when they are on “sale in their favorite store,” eight in 10 typically use “all or nearly all” of their benefits each month, and six in 10 said they would find it “helpful” to see SNAP items marked as such on supermarket shelves. If their favorite stores accepted SNAP benefits for online shopping, as more and more retail chains are beginning to do, almost half in the study said they would “always” or “frequently” use such a service.
SNAP represents a big piece of the grocery market. As of April 2021, according to the USDA, there were 42.3 million people -- about 20% of all U.S. adults -- and 22.1 million households enrolled in SNAP. The total monthly benefit cost during April 2021 was $9.6 billion, a 26% increase over April 2020. The average per person and per household benefits were $203 and $386, respectively. In October, average benefits will rise more than 25% from pre-pandemic levels.
Total grocery sales last year in all U.S. outlets were $816 billion; in supermarkets they were $404 billion, per Nielsen. By comparison, SNAP food expenditures in 2020 were $79 billion at authorized stores plus associated program costs. This year, total SNAP spending projects to exceed $100 billion, based on USDA data. Combined, supermarkets and super stores redeem over 82% of annual SNAP benefits while comprising only 15% of the program’s 250,000 authorized retailers.
Expanding store brand sales among this group of consumers can be beneficial to all parties, Davies said. For the SNAP shopper, the savings realized from opting for store brands can be spent on additional SNAP food items in the store for their household. The retailer benefits by boosting high-margin, private label sales, and by strengthening consumer loyalty with an important and sizeable demographic. And the SNAP program benefits by effectively getting more food products into recipients’ households for the same amount of federal dollars expended.
The PLMA report and its recommendations come at a time when program participants are under increasing pressure to feed themselves and their households. Even with the benefits, the cost of food remains an issue for many, says the USDA, whose June report said recipients still face major barriers to achieving a healthy diet throughout the month. The most common problem was the affordability of foods that are part of a healthy diet.
One way to contend with higher food prices, as the PLMA study suggests, is for recipients to buy more store brands. The cost savings can be significant. In separate research, PLMA sponsored the purchase over a four-week period of multiple, typical market baskets consisting of about three dozen SNAP eligible food products.
The average savings realized when the store brand versions of the products were bought vs the national brands were 38% when shopping in a major supermarket located in the northeast and 50% when shopping in a leading national mass merchandiser.
Do you agree or disagree that store brand products are as good, the same as, or better than national brands on the following attributes?
Value of the products
Store brands much better 21%
Store brands often better 26%
The same/No difference 34%
National brands often better 12%
National brands much better 7%
Quality of the products
Store brands much better 22%
Store brands often better 15%
The same/No difference 40%
National brands often better 17%
National brands much better 7%
How aware are you of the store brand versions of the food products you would normally buy when shopping in your favorite stores?
Very aware 69%
Somewhat aware 25%
Not very aware 3%
I don't think about it 2%
Thinking about store brand food products that you purchased in the past, how would you describe your overall satisfaction with them?
Very satisfied 38%
Somewhat satisfied 40%
Neither satisfied nor dissatisfied 15%
Somewhat dissatisfied 7%
Very dissatisfied 1%
When you use SNAP benefits to purchase food products, what kinds of brands do you generally buy?
All national brands 10%
Mostly national brands 12%
About half national brands & half store brands 33%
Mostly store brands 24%
All store brands 5%
It varies each time I shop 13%
I don't pay attention to brands when I shop 3%
How helpful would it be if the store brand food products sold in your favorite store were clearly marked on the package as “Approved for SNAP?”
Very helpful 40%
Somewhat helpful 19%
It may or may not be helpful 16%
Not helpful 4%
Very unhelpful 3%
Don't know/It would not matter to me 13%
I would prefer products not be marked as SNAP approved 5%
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The Private Label Manufacturers Association is a non-profit organization founded in 1979 to promote the store brands industry. It is the only trade group of its kind, representing 4,500 member companies in more than 75 countries. In addition to annual, industry-defining trade shows in Chicago and Amsterdam, PLMA offers its members annual Leadership and Washington conferences, executive education and professional development programs, original consumer and market research, quarterly category and channel sales data from Nielsen, and digital media platforms, including exclusive news coverage from PLMA Live and the e-Scanner monthly industry newsletter. Follow PLMA on Twitter and LinkedIn.