Private labels emerge as key growth lever for US retailers: Study

The study reveals that the traditional distinctions between private labels (or branded products made by retailers to sell exclusively in their own stores) and national brands have become so subtle that most consumers can’t tell the difference between them.

Once seen as lower-tier alternatives to national brands, private labels are now becoming more competitive—and part of many retailers’ long-term growth strategies. Retailers are putting more effort into the quality, appearance and marketing of their private labels—and shoppers are responding: In fact, 84 per cent of consumers now trust in the quality of store-brand products more or the same as national brands, while more than half (52 per cent) say they’ve been influenced to try a store-brand product by in-store promotions, packaging, displays or marketing materials.

Study findings from The Quiet Takeover of Private Label by First Insight reveal that the stigma around private labels has almost vanished, with 77 per cent of shoppers unconcerned about how others perceive their private-label purchases. Nearly half (47 per cent) intentionally seek out private labels as cost-effective dupes of name brands, and 44 per cent—rising to 70 per cent among those earning over $150K—are more inclined to try private labels marketed as dupes of premium products.

Brand loyalty is on the decline as only 48 per cent still identify as brand loyal, while 32 per cent are brand curious and 20 per cent driven by savings. Additionally, 71 per cent would switch to private labels if their usual brand is out of stock, and a notable 45 per cent have permanently replaced national brands once private labels met or exceeded expectations

Essentials such as groceries (56 per cent), household cleaning products (38 per cent), clothing and apparel (34 per cent), and personal care items (33 per cent) serve as the primary entry points for private-label adoption. More than a third (47 per cent) of shoppers actively seek out private-label ‘dupes’ of name-brand items, and this trend grows stronger among wealthier consumers—44 per cent overall, with a notable 70 per cent of those in the $150K+ income bracket—reporting they’re more inclined to try a product if marketed as a premium dupe.

Brand loyalty appears to be waning, replaced increasingly by a focus on value, quality, and availability. Only 48 per cent of consumers now describe themselves as brand loyal, while 32 per cent are ‘brand curious’ and 20 per cent shop primarily for savings. Moreover, 71 per cent say they’d switch to a private label if their preferred national brand was out of stock, and nearly half (45 per cent) have permanently shifted to a private label after finding it met or exceeded their expectations.

This transition toward private labels hasn’t just driven sales—it’s also fuelled advocacy and shopper loyalty. Around two-thirds (66 per cent) of consumers recommend store-brand products to friends and family, and 34 per cent say they’re more likely to shop at a retailer because of its private-label offerings.

“Shoppers aren’t loyal to brand names the way they used to be. They’re loyal to price, quality and marketing. This creates a highly competitive arena where the best–yet not necessarily the most well known–brands will win,” said Greg Petro, CEO of First Insight. “When a national brand stumbles, it opens up an opportunity for private labels to grow their market share—but only for those with products that feel intentional, well-designed and trustworthy. Consumers will let you know exactly which ones those are. You just have to ask them.”

First Insight’s report is based on responses from 1,267 respondents ranging from 18 to 80+ years old.

ALCHEMPro News Desk (RR)