Modern, Fun, Innovative and Adventurous: Private Label Brands Score on Name Brand Turf
Brands, in their effort to appeal to consumers, have always offered a reflection of the cultural landscape, and the American cultural landscape has changed dramatically in the last half a century.
In a not too distant past—say, for example, as recently as the 1970s—iconic food and beverage brands represented a powerful system of influence in consumer food culture where brand and quality were closely linked and trust in and dependency on name brands were high. Television ads were a celebration of modern convenience and fun (for those who can remember, consider classic ads from brands like Charlie the Tuna for StarKist, Shake ‘n Bake, Jell-O and Hunt’s Manwich).
Within this cultural system, the U.S. food industry used brands to tell consumers what attributes (taste, quality, consistency) they could expect from their products. Post-WWII expansion and growth in the U.S. economy, population and the reach of mass media set the stage for a new era in the American food and beverage marketplace. Spurred by the unprecedented opportunity to win consumers' attention and spending, manufacturers invested heavily in brands. In turn, the U.S. food landscape became the birthplace and showcase for iconic food and beverage brands in a way that was distinctively American.
Our Brand Ambition: Food and Beverage Private Brands & Beyond report finds that today, the role brands play in consumer food and beverages choices has shifted—and diminished in its traditional sense—along with an evolving food culture over time. This evolution has been slowly building over the past three decades. For example:
- From the 1980s to the 1990s, food culture became known for its increasing focus on individuality, diet and appearance: Brands were used as identity signifiers. Trust in brands was still high, but dependency was waning. Quality became linked to brand and nutritional content.
- From the 2000s to today, food culture and consumers are looking beyond the individual to the holistic, with more focus on attributes and practices than branding. There’s been a transition and expanded focus from just nutrients to whole foods and nutrient-dense ingredients. Additionally, today there is an emerging holistic focus on pure, simple production and sustainable sourcing
Private Brands Today
Reflective of the changing role of brands in consumers’ lives and their changing views on nutrition and health, consumers recognize the dramatic evolution of private brands over time and their ability today to provide foods and beverages highly competitive with name brands. Consequently, gone are the days of private brands’ image as a boring, no-name option.
Compared to name brand buyers rating their name brands, private brand buyers are more likely to view the private brands they buy—at least those presented as premium, organic or better for you—as more modern, fun, innovative and adventurous. Asked to rate personality perceptions of name brands compared to private brands, among category buyers of 8 private label food and beverage categories, consumers rated private brands equally trustworthy and convenient to name brands, and more modern, innovative, fun, adventurous, ethical and experiential (Figure 1).
Figure 1: Personality Perceptions of Name Brands vs. Private Brands
Among Private Label Category Buyers, Average Across 8 Profiled Categories
Source: Brand Ambition: Food and Beverage Private Brands & Beyond report
As we can see, consumers still turn to name brands for comfort and nostalgia and for classic experiences. Yet, with the increasing focus among consumers on both ingredient purity and environmental and social responsibility, private brands have earned permission to take leadership in this space via their premium offerings. However, there is a fundamental difference. Despite updated looks, new products and premium offerings, private brands are still expected to provide most (or all) of what name brands are offering while starting from a lower price point.
The success private brands have had thus far in moving consumers to adjust and update their perceptions of private brands—from low-cost “knockoffs” to higher-quality, high-value products across all categories—suggests that they have an opportunity to continue to build their reputation and standing with consumers, especially younger consumers who are just beginning to develop their food sourcing patterns and habits.