New Report Shows Continued Gains For Private Label
Nearly two-thirds of consumers have purchased a private label product over the past six months, according to a new report from Bazaarvoice.
In its 2024 Shopper Preference Report, shoppers turning to store brands products have done so in several key categories including food and beverage (71%), health and beauty (48%), and fashion (41%). Notably, 44% of those surveyed said they have permanently switched some of their staple products to those sold under retail private brands, showing a potential shift in long-term consumer preferences toward private label offerings.
Zarina Stanford, chief marketing officer, with Bazaarvoice, said while economics continues to be a major factor driving consumers to private label products, there are other factors also at play.
“When you look at retailers such as Costco and others, they have done so well positioning their products as not only standing for value, but also quality,” she said. “And when you look at fashion or apparel categories, style is another factor that also matters. When you add it all up, the private label products are offering a high level of perceived value.”
Playing a key role in enhancing the perceived value of private label products, Stanford said, is the maturation of the industry in recent years. No longer are store brand products simply knock-offs of existing items, but today are quality products that meet a specific need.
“Delivering on product quality has been vital to the growth of private label,” she said. “Retailers such as Target are offering products that are consistent in their quality and meet the needs of their shoppers. And consumers are telling us the same thing. They are saying they feel the quality of private label products are equal to or better than the national brands they have been buying.”
In addition to the growth the private label segment continues to see, the Bazaarvoice report noted that 64% of U.S. consumers back in an office for part of their work week, and this is leading to growth in spending at brick and mortar stores. More than half (53%) of those who are back in the office are spending more money in stores as compared to e-commerce outlets.
“Delivering on product quality has been vital to the growth of private label. Retailers such as Target are offering products that are consistent in their quality and meet the needs of their shoppers.
—Zarina Stanford, Bazaarvoice
Social media also continues to play a major role in consumer purchasing decisions. Almost a quarter (24%) of Americans make monthly purchases based on items they encountered on social media. Research shows that 60% of consumers have made purchases influenced by social media with 66% preferring to discover new products through videos on social channels.
Other key U.S. findings from the Shopper Preference Report include:
• Brand Loyalty: Quality is the main factor that influences brand loyalty for 53% of consumers, followed by price (37%). Also, 40% of consumers are influenced by personalized recommendations, while 48% prefer loyalty programs that enhance their loyalty experience.
• Sustainability and Second-Hand Shopping: 44% of consumers have increased their purchases of second-hand items as compared to the previous year. The U.S. and the UK lead other countries with 64% of consumers saying they purchase second-hand items from online platforms such as Vinted, Depop, etc., and thrift stores.
• Retail Therapy: 68% of consumers take pleasure in retail therapy. At the same time, 17% of Americans cannot afford essential purchases right now, highlighting the strain faced by the current economic conditions.
• Despite the growing importance of sustainability, with 76% of Americans considering a company's commitment to sustainability and ethical practices important, the appeal of fast fashion is strong for money-strapped consumers. 64% of Americans said they purchase at least 25% or more of their wardrobes from fast fashion retailers. Notably, Americans constitute the largest region (79%) admitting to purchasing clothing items that end up rarely or never being worn.
Results of Bazaarvoice’s Shopper Preference Report is based on a survey of more than 8,000 global consumers. The survey, which included 2,000 respondents from the United States, captured insights on online and offline experiences, sustainability concerns, social commerce influence, and more.