|Title:||Europe private label consumer packaged goods penetration by country in percentages with sales in dollars for 2001, 2006, and 2011|
|Source:||Tea & Coffee Trade Journal|
Start of full article - but without data
Private Label CPG European Country Data (per cent)
Penetration Sales Value $bn 2001% XooX % 2011% 2001 2006 2011
France XX XX XX XX XX XX Germany XX XX XX XX XX XX Italy XX XX XX XX XX XX Holland XX XX XX X X X Spain XX XX XX XX XX XX Sweden XX XX XX X X X UK XX XX XX XX XX XX Europe XX XX XX XXX XXX XXX
Source: CPG PL adapted from Datamonitor
Growth signs in the U.S. are promising. In the retail segment, private brands weathered the 2008, 2009 and 2010 depressing recession. Retailers backed their brands and manufacturers pushed innovation into private brands as traditional brands staggered under their marketing and distribution costs. As the economy in the U.S. starts to recover, traditional brands are showing stronger signs of recovery and are bringing life back into their brands and flexing their marketing muscle to gain consumer mindshare again. But, has the damage already been done to traditional brands. Are private brands going to outstrip traditional brands across the globe?
This article cannot answer that today. Readers of Tea & Coffee herald from around the world and in this X-part series the goal is to explore common influencers and trends in X key areas of private label. This first part deals with already collected data and research reports. Part X, later this year, will launch a short survey to get answers to the X key areas. Part X, at the end of this year, will bring a summary of answers and help glean trends from responders. Ultimately, the goal is to help those in the tea and coffee industry market to consumers and gain their dollars and loyalty.
In this article, we define X key areas of private brands, influencers and trends. They are:
X. Consumer Perception & Trends
X. Quality & Value Perception
X. Market Segmentation by Consumers
X. Hurdles, Constraints & Barriers in Tea and Coffee
X. Industry Sustainability & Future Growth of Private Brands
Consumer Perception & Trends
Defining consumer perception trends varies between products and between cultures. Primary influencers include product profiles, packaging, marketing and branding.
Private label brands used to be considered the "poor man's brand" but in the last several years they have come into their own and now rival established consumer brands for space and price. Private brands are no longer less expensive than traditional brands. Creators and manufacturers have begun to capitalize on the ability to bring to market a better product in a private label. And consumers are embracing it.
The 2011 Neilson Report states that "consumers have embraced store brands with open arms, and in turn, many retailer's products delivered on their quality and value promises." In the Nielsen study, about three quarters of shoppers viewed store brands as a "good alternative to name brands," and even more encouraging for retailer& almost four in ten buyers felt that "some are higher quality than name brands."
Chart X shows the percent of individuals surveyed who said they agreed or strongly agreed with the statement about private brands. Most noticeably, there is an increase in the percent agreeing or strongly agreeing with the statement that some private brands are of higher quality than name brands. In the space of X years, there has been a X% increase in quality of private brands.
Quality & Value Perception
The geographical distribution of private brands as a percent of all total sales across the globe is as follows:
* North America--XX%
* Asia Pacific--X%
* Latin America--X%
*Source: Data & Trends of the European Food and Drink Industry, 2010.
With Europe being the undisputed leader in private brands, it is no wonder that they have learned to understand their consumers and target private brands to that consumer. Tesco was one the earliest companies to launch private brands within their stores and today, they have over XX,XXX SKU's of private brands comprising of over XX% of the company's revenue. They offer a variety of private brands to target each market segment that shops their stores:
* Premium Brands--the highest level of quality;
* Sub Premium Brands--"special" products;
* Commodity Brands--standard products; and
* Generic Brands--value or cost driven products.
Understanding how the market leader has defined the tiers of private brands is key to understanding which product to offer retailers when presenting a private label program.
Market Segmentation by Consumers
Offering different tiers of private brands helps retailers connect with consumers. To understand the consumer, it is important to understand how consumers are segmented, as this affects their buying habits or likelihood to consider purchasing private brands.
Damon Worldwide identified several key factors that influence market segmentation in private label and it's effect on consumers. Briefly, the seven key consumer factors are:
X. Consumers are postponing marriage and there are now more single people living independently than ever before and there are more single-parent households than in years past.
X. Consumers are increasingly demanding organic or all natural products
X. Consumers are increasingly engaged in diverse or bi-racial relationships.
X. Consumers are traveling more than ever before. Coincidentally, XX% of destinations selected are in Europe, where private brands are king.
X. Consumers are better educated and have increased access to information than even XX years ago.
X. Consumers are inundated with television food shows and the related marketing endorsements.
X. Consumers have increased their dining out experiences and are eating culturally more diverse meals and flavors than before.
Each one of these factors have a huge impact on decision making when purchasing private brands.
Hurdles, Constraints & Barriers in Tea and Coffee
One of the biggest hurdles in private label specific to the tea and coffee industry is a paucity of data. Sifting through data to find information relative to tea and coffee can be time consuming and expensive. There is a real need to understand the trends in tea and coffee.