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Private Label Food and Non-alcoholic Drink - UK - November 2015

Published By :

Mintel

Published Date : Nov 2015

Category :

Non-Alcoholic Drinks

No. of Pages : N/A

That three in 10 shoppers would like to have a say in new products being added to own-label ranges, indicates this an a valuable route for own-brands to canvas the opinions of shoppers whilst also helping to build engagement and loyalty.

Table of Content

Overview

What you need to know
Products covered in this report

Executive Summary

The market
Figure 1: Retail value sales and forecast of private label food and drink, UK, 2010-20
Market factors
Price wars fuel food price deflation
Figure 2: Retail Price Index of all food, January 2010-September 2015
Private label becomes a more important differentiator
Consumers find themselves in a better financial situation
Companies, brands and innovation
Branded products increase share of NPD in 2014
Tesco and Asda reviews their entire product ranges
The consumer
Most people shop across brands and own-label
Figure 3: Purchasing of own-label and branded food and non-alcoholic drinks, September 2015
Premium own-label needs to innovate and prove its value
Figure 4: Attitudes towards premium own-label food and non-alcoholic drinks, September 2015
Majority compare own-label and brand prices
Figure 5: Behaviour relating to purchasing of own-label and branded food and non-alcoholic drink, September 2015
A poor own-label offer is a put-off
A third would not spend extra on their grocery shop
Figure 6: What food and non-alcoholic drink shoppers would spend extra money on, September 2015
Everyday low pricing appeals
Figure 7: Attitudes towards own-label and branded products, September 2015
Independent awards help to build perceptions of quality
Figure 8: Attitudes towards retailer exclusive brands, September 2015
What we think

Issues and Insights

Inviting shoppers to influence NPD can help to elicit trust and build quality perceptions
The facts
The implications
Scope to harness interest in how own-label products are made
The facts
The implications
Supporting small producers can enhance the appeal of own-label products
The facts
The implications

The Market – What You Need To Know

The private label food market is worth £47.9 billion
Falling prices saw private label sales slip into decline in 2015
Private label outperforms brands thanks to booming sales at discounters
Rising consumer spending should promote trading up within own-label
Non-alcoholic drinks tend to be dominated by private label
Own-label has a near monopoly in fresh fruit and veg, meat and fish
Confectionery is the domain of brands

Market Size and Forecast

Figure 9: Retail value sales of private label food and non-alcoholic drink, at current and constant prices, 2010-20
The future
Figure 10: Retail value sales and forecast of private label food and drink, UK, 2010-20
 

Market Segmentation

Milk continues to be dominated by private label
Figure 11: Share of private label in retail* sales of non-alcoholic drinks, by category, 2014 and 2015
Own-label has a minor presence in CSDs and sports/energy drinks
Own-label continues to lose out in tea and coffee
Own-label has a near monopoly in fresh fruit and veg, meat and fish
Brands play a small role in ready meals

Figure 12: Share of private label in retail* sales of food, by category, 2014 and 2015
Confectionery is the domain of brands

Market Drivers

Discounters continue to steal share, providing a boost to private label
Grocery retailers compete fiercely
Consumers find themselves in a better financial situation
Figure 13: Consumers’ financial wellbeing index, February 2009-April 2015
Price wars fuel food price deflation
Figure 14: Retail Price Index of all food, January 2010-September 2015

Key Players – What You Need to Know

Branded products increase share of NPD in 2014
The branded to private label ratio varies widely between categories
Tesco and Asda review their entire product ranges
M&S launches a ‘Tastes of the British Isles’ range
Lidl launches major price comparison campaign against brands
Tesco introduces Brand Guarantee
Frozen food is put in the limelight

Launch Activity and Innovation

Branded products increase share of NPD in 2014
Figure 15: New product launches in the UK food and non-alcoholic beverages markets, branded vs private label, 2011-15
The branded to private label ratio varies widely between categories
Figure 16: Share of private label in new product launches of food and non-alcoholic drink products in the UK, by product category, 2015*
Figure 17: Percentage point change in the share of private label in new food and non-alcoholic drinks launches, by product category, 2013-14
M&S launches a ‘Tastes of the British Isles’ range
Ethnic Cuisines is also a strong focus for M&S
Asda launches Good & Balanced and Good & Counted ranges
Private label offers up ethical solutions
‘Project Reset’: Tesco reviews its entire product range
Asda also unveiled a new strategy
Aldi seeks to offer organic at an affordable price

Brand Communication and Promotion

Lidl launches major price comparison campaign against brands
Tesco introduces Brand Guarantee
Marks and Spencer introduces Sparks ‘members’ club’
Sainsbury’s pushes its private label ingredients
Iceland launches a Power of Frozen campaign
Waitrose allows shoppers to choose their own discounted products
Asda brings back the ‘pocket tap’
Aldi sponsors Team GB ahead of Rio 2016 Olympics
Grocers take very different approaches in their Christmas 2015 advertising

The Consumer – What You Need To Know

Over-55s are top buyers of premium own-label products
High levels of mix and matching across brands and own-label
Premium own-label has to innovate and prove its value
Giving the shoppers a say can drive engagement
A poor own-label offer is a put-off
A third would not spend extra on their grocery shop
Everyday low pricing appeals
Shoppers are keen to support small producers
Independent awards help to build perceptions of quality

Purchasing of Own-label and Brands

Over-55s are top buyers of premium own-label products
Majority buy both value and premium own-label
Figure 18: Types of own-label and branded products bought, September 2015

Attitudes towards Premium Own-label

One in two happy to receive premium own-label as a gift
Premium own-label has to innovate and prove its value
Figure 19: Attitudes towards premium own-label food and non-alcoholic drinks, September 2015

Shopping Behaviour

Majority compare own-label and brand prices
Figure 20: Behaviour relating to purchasing of own-label and branded food and non-alcoholic drink, September 2015
Half of shoppers compare ingredients
A poor own-label offer is a put-off
Giving the shoppers a say can drive engagement

What Shoppers Would Spend Extra Money On

Two thirds of people would spend extra on their grocery shop
Figure 21: What food and non-alcoholic drink shoppers would spend extra money on, September 2015
One in three would trade up to more expensive foods
Brands and premium own-label see limited appeal
One in four would spend extra at specialist stores

Attitudes towards Own-label and Branded Products

Everyday low pricing appeals
Own-label is seen as savvy shopping
Figure 22: Attitudes towards own-label and branded products, September 2015
Transparency can win over own-label shoppers
Shoppers are keen to support small producers

Qualities Associated with Own-label, Private Label Brands and Brands

Methodology
Correspondence analysis
Dairy Milk excels on quality perception
Figure 23: Correspondence analysis – Private label and branded chocolate products, September 2015
Figure 24: Private label and branded chocolate products, September 2015
Dairy Milk also scores the highest on indulgence and fun
Moser Roth seen to be as special as Cadbury’s Dairy Milk
Many people are unsure about Lidl’s Fin Carre

Attitudes towards Retailer Exclusive Brands

Shoppers want the best of both
Figure 25: Attitudes towards retailer exclusive brands, September 2015
Tertiary brands more acceptable as gifts than premium own-label
Independent awards help to build perceptions of quality

Appendix – Data Sources, Abbreviations and Supporting Information

Abbreviations
Consumer research methodology
Fan chart forecast

Appendix – Market Size and Forecast

Figure 26: Best- and worst-case forecasts for private label food and non-alcoholic drink, by value, 2014-19

List of Table

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