IELKA: Increased sales of private label products

Opportunity for the development of private label (PL) products due to the economic environment, “sees” the Consumer Research Institute for Retail Goods (IELKA).

Specifically, the data of the annual pan-Hellenic survey, with a sample of 2,000 consumers from all over Greece, show that Greeks in their effort to save money choose comparatively more the purchase of private label products from supermarkets. “Current international developments show that the pressure on household disposable income will continue due to rising energy costs and international pressures on food raw material prices. Given this forecast, it is a given that cheaper products in general especially the private label products will be more tempting choices for the consumers “it is pointed out in the research of IELKA

Compared to 2020, both 2021 and this year, many more consumers believe that private label products provide better value for money, at 50% compared to 38% last year. This difference is attributed, according to IELKA, to the developments that take place in the consumer public, its disposable income due to the increase of energy-transport costs and the price increases of the products.

Given the price increases of several products due to international developments (pandemic, war in Ukraine, etc.) the lower price of private label products becomes more “tempting” for buyers, according to IELKA. After all, the percentage of consumers who consider private label products cheaper than branded ones remains unchanged in 2021 compared to 2020 at 65%, which shows that the image of the buying public for the comparative price of of these products, but based on the time evolution of prices, now the private label products respond as value for money better than the previous year. The picture is the same in relation to the Greekness of private label products with the percentage of consumers stating that these products are more “Greek” to increase from 47% to 49%.

It is noted that during the period 2019-2020 the quality criteria dominated the reasoning of the buying public. Specifically, in 2019, 37% of buyers stated that they bought with quality as the basic criterion, compared to 31% based on monetary expenditure. Two years later the picture has been reversed with 39% stating that they are buying on the basis of money and 29% on the basis of quality criteria.

Now, the turn of the consumer public has begun to be reflected in the sales data. It is noted that traditionally the share of private label products in sales remains comparatively much lower than the markets of Western Europe, with rates moving in the last decade in the region of 25% -30% in Greece compared to 40-45% in Western Europe.

As recorded in the supermarket sales data presented by IRI at the general meeting of ECR ​​Hellas on 23/3/2022, in the first 9 weeks of 2022, private label products have increased their sales by 9.7%, while total sales of fast-moving supermarket products are stable with a change of -0.1%. In other words, it seems that consumers are trying at this time to switch to cheaper product choices, which together with offers and discounts (are tools of the so-called “smart markets”) and can help them maintain a stable “volume” level. fixed cost purchases. The main categories with increasing private label sales are pasta, detergents, coffee, chocolates and some frozen items.