Table of Contents
Introduction
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- Definitions
- Abbreviations
Executive Summary
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- The market
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- Figure 1: Retail value sales and forecast of private label food and drink, UK, 2009-19
- Market factors
- The squeeze on real incomes continues
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- Figure 2: Annual % change in average total earnings, consumer prices (CPI) and food RPI, January 2009-August 2014
- A drop in food and non-alcoholic drink prices
- A ‘savvy shopping’ mentality has become ingrained
- Companies, brands and innovation
- Brands overtook private label in NPD activity in 2013
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- Figure 3: New product launches in the UK food and non-alcoholic beverages markets, branded vs private label, 2010-14
- A third of food and drink adspend is by the grocers
- The consumer
- 85% of adults buy own-label
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- Figure 4: Purchasing of own-label and branded food and non-alcoholic drink, September 2014
- A stark difference in taste perceptions between categories
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- Figure 5: Products perceived to be tastier, selected categories, brands versus own-label, September 2014
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- Figure 6: Consumers willing to pay more for branded products, by category, September 2014
- Price and quality hold most sway
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- Figure 7: Factors which would encourage consumers to buy or to buy more own-label food and/or non-alcoholic drink instead of branded ones, September 2014
- Copycat own-label products divide opinion
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- Figure 8: Attitudes towards own-label and branded food and non-alcoholic drink products, September 2014
- What we think
Issues and Insights
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- Opportunities for the development of own-label within chocolate to develop in through the impulse channel
- The facts
- The implications
- Supermarkets can do more to engage with their shoppers in-store to give them an edge over brands
- The facts
- The implications
- Brands need to prove their worth in order to benefit from the expected rise in consumer spending in the mid-term
- The facts
- The implications
Trend Application
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- Trend: Collective Intelligence
- Trend: Experience is All
- Trend: The Nouveau Poor
Market Drivers
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- Key points
- The squeeze on real incomes continues
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- Figure 9: Annual % change in average total earnings, consumer prices (CPI) and food RPI, January 2009-August 2014
- Special offers remain a key draw for shoppers
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- Figure 10: Grocery shopping habits people are doing more of this year than last year, September 2014
- Does an improved economy bode well for brands?
- Premium own-brand to benefit as spending gains momentum
- Brands are under pressure to step up their game
- Value ranges look set to suffer
- Strong demand for eating out challenges ‘dine in’ products
Who’s Innovating?
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- Key points
- Brands overtook private label in NPD activity in 2013
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- Figure 11: New product launches in the UK food and non-alcoholic beverages markets, branded vs private label, 2010-14
- A sharp contrast in private label NPD activity across categories
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- Figure 12: Share of private label in new product launches of food and non-alcoholic drink products in the UK, by product category, 2014*
- Figure 13: Percentage point change in the share of private label in new food product launches, by product category, 2013-14*
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- Figure 14: Percentage point change in the share of private label in new non-alcoholic drink product launches, by product category, 2013-14*
- Tesco stays at the top in terms of new launches
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- Figure 15: Share of private label launches in the food and non-alcoholic beverages markets, by company, 2010-14
- M&S and Waitrose expand their range of ready meals
- The discounters look to premiumisation
- A drop in economy launches from own-label
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- Figure 16: Share of new product launches in the UK food and non-alcoholic drink market carrying premium and economy claims, own-label vs branded, 2010-14
Market Size and Forecast
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- Key points
- Private label growth has an edge over brands
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- Figure 17: Index of UK retail value sales of private label and all food and drink, 2009-13
- Steady value growth forecast
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- Figure 18: Retail value sales of private label food and non-alcoholic drink, at current and constant prices, 2009-19
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- Figure 19: Retail value sales and forecast of private label food and drink, UK, 2009-19
- Methodology
Segment Performance
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- Key points
- Milk is the only private label-dominated non-alcoholic drinks sector
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- Figure 20: Share of private label in sales of non-alcoholic drinks, by category, 2014*
- Figure 21: Share of private label in sales of non-alcoholic drinks, by category, 2013 and 2014
- Private label dominates milk as a commodity
- Brands lead in bottled water
- Brands have a near-monopoly in CSDs
- A strong lead for own-label in ready meals and dips
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- Figure 22: Share of private label in sales of food, by selected categories, 2013 and 2014
- Own-label is almost non-existent in baby food and drink and gum
- ‘Treat’ purchases tend to be the domain of brands
Companies and Products
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- Asda
- Market positioning
- Private label offering
- Recent activity
- Co-operative Group
- Market positioning
- Private label offering
- Recent activity
- Morrisons
- Market positioning
- Private label positioning
- Recent activity
- Sainsbury’s
- Market positioning
- Private label offering
- Recent activity
- Tesco
- Market positioning
- Private offering
- Recent activity
- Waitrose
- Market positioning
- Private label positioning
- Recent activity
- Marks & Spencer
- Market positioning
- Private label positioning
- Recent activity
- Discounters
- Aldi
- Lidl
Brand Research
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- Brand map
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- Figure 23: Attitudes towards and usage of brands in the supermarket private label sector, August 2014
- Correspondence analysis
- Brand attitudes
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- Figure 24: Attitudes, by supermarket private label brand, August 2014
- Brand personality
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- Figure 25: Supermarket private label brand personality – macro image, August 2014
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- Figure 26: Supermarket private label brand personality – micro image, August 2014
- Brand experience
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- Figure 27: Supermarket private label brand usage, August 2014
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- Figure 28: Satisfaction with various supermarket private label brands, August 2014
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- Figure 29: Consideration of supermarket private label brands, August 2014
- Brand recommendation
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- Figure 30: Recommendation of selected supermarket private label brands, August 2014
Brand Communication and Promotion
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- Key points
- A third of food and drink adspend is captured by the grocers
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- Figure 31: Main monitored media advertising expenditure on food and non-alcoholic drink, 2010-14
- Tesco reclaimed its leadership in 2013
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- Figure 32: Main media advertising expenditure on food and non-alcoholic drinks, by selected retailers**, 2010-14
- Figure 33: Share of main media advertising expenditure on food and non-alcoholic drinks, by selected retailers**, 2010-14
- Morrisons, Aldi and Co-operative Food grew adspend significantly in 2013
- Morrisons focuses on price 2014
- Aldi
- Co-op
- Lidl unveils debut TV ad campaign
The Consumer – Usage of Own-label and Brands
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- Key points
- 85% of adults buy own-label
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- Figure 34: Purchasing of own-label and branded food and non-alcoholic drink, September 2014
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- Figure 35: Purchasing of own-label and branded food and non-alcoholic drink, September 2013 and September 2014
- Over-55s and ABs most likely to buy premium own-label
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- Figure 36: Purchasing of premium-own-label and branded food/non-alcoholic drink products, by age and socio-economic group, September 2014
- Tesco is the most popular supermarket for own-label
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- Figure 37: Retailers from which own-label food/non-alcoholic drink has been bought in the last three months, September 2014
The Consumer – Taste Perceptions of Brands versus Own-label
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- Key points
- A stark difference in taste perceptions between categories
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- Figure 38: Products perceived to be tastier, selected categories, brands versus own-label, September 2014
- Own-label has more positive taste perceptions in bread and baked goods and pasta
- Chocolate is the only category most shoppers are happy to pay more for brands in
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- Figure 39: Consumers willing to pay more for branded products, by category, September 2014
The Consumer – Enticements
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- Key points
- Price and quality hold most sway
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- Figure 40: Factors which would encourage consumers to buy or to buy more own-label food and/or non-alcoholic drink instead of branded ones, September 2014
- Low price appeals but not at any cost
- Quality chimes in particular with ABs
- In-store tastings appeal to a third of shoppers
- Choice and innovation can drive purchasing of own-label
- Importance of recommendations from trusted sources
The Consumer – Attitudes towards Own-label and Brands
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- Key points
- Copycat own-label products divide opinion
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- Figure 41: Attitudes towards own-label and branded food and non-alcoholic drink products, September 2014
- Under-25s are most inclined to buy brands when treating themselves
- Low cost enables trading up
- Own-label has more sway over shopping habits than brands
- Opportunities for the development of own-label in the convenience channel
Appendix – Market Size and Forecast
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- Figure 42: Best- and worst-case forecasts for private label, by value, 2014-19
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