Millennials Find Store Brands More Innovative

CHICAGO — Private-label food products are grabbing the attention of younger shoppers. A new report from global market intelligence firm Mintel shows that 42 percent of Millennials (aged 18-36) agree that store-brand food products are more innovative than name-brand products.

Store-brand food buyers overall have positive perceptions of these products, with 63 percent agreeing they are higher in quality than they used to be, including close to 70 percent of Millennials.

Many U.S. shoppers agree that store-brand products stack up against their name-brand counterparts in flavor, packaging and variety of product offerings, further blurring the line between the brand types. Overall, more than one-third of U.S. shoppers (37 percent) said they prefer to buy store-brand products over name-brand products, according to Mintel’s research.

“Name-brand power no longer holds the most weight. Quality, price and innovation are carving out a larger portion of consumer mindshare,” said Amanda Topper, Mintel’s food analyst.

Nearly 70 percent of all store-brand shoppers agree that they trust certain store brands more than others and 64 percent say once they’ve tried one store-brand product, they are likely to try other products. Ideologies of brand trust are even stronger for Millennials, who are more likely to buy store-brand foods in general (97 percent vs. 94 percent of all U.S. shoppers).

Additionally, in its new report, Mintel identifies unique sub-groups within the 94 percent of U.S. shoppers who are private-label food buyers. One group, "Private Label Lovers," consists of consumers who seek out products that are lower in price than name-brand products, but equivalent in terms of ingredients and quality. “Cost-savings is a priority for the Private Label Lover consumer segment, but not at the expense of sacrificing quality,” Topper explained.

Aside from quality, variety of options and product innovation, functional packaging attributes are also important to store-brand shoppers, including ease of opening (35 percent), resealablity (35 percent) and ease of storage (29 percent). Private Label Lovers would also like to see more product for the same price (55 percent) and products made in the USA (45 percent).

“Along with a move toward healthier eating and better-for-you foods, many private-label food products are focusing on clean labels with easy-to-read ingredients and product claims,” Topper said. “Store-brand shoppers are gravitating toward this trend, seeking out store-brand products that list ingredients they recognize and feature prominent claims such as 'organic,' 'low/no/reduced' or 'made with natural ingredients' right on the packaging.” 

Nearly one-third of adults who buy store-brand foods (30 percent) indicate that they consider "no artificial ingredients" when making a purchase. Additionally, the number of private-label food products launched between 2009 and 2014 with a "low/no/reduced allergen" claim has increased by 11.7 percentage points, and gluten-free claims have increased by 10.5 percentage points, according to Mintel's Global New Products Database.

The full report, Private Label Foods: What’s Driving Purchase? — US, can be purchased and downloaded by visiting store.mintel.com.