What lies ahead for Private Brand?

Samantha Lee, our US Client Director based in Arkansas, reflected in her blog How to Win in Private Brand, on the remarkable growth of Private Brand sales in the US, now reaching a staggering $236 Billion [1].

Since Covid this sector has been thriving, with 44% of shoppers admitting to buying more Private Brands today than they did a year ago [2].

We highlighted the surefire ways to maintain and gain Private Brand market share in 2024, emphasising cost, availability, quality, exclusivity, brand over product, and the evolving dominance of story telling as digital content explodes across all channels.

In this blog, Samantha explores: Who is ready to take Private Brand to the next level? And what are the industry predictions for the brightest retailers leading the way? Drawing on knowledge gained over decades of working with global retailers, we’ve identified our top 3 opportunites; let’s see if our prophecy comes true!

 Feel so close to you right now

While every Private Brand adores their advocate shoppers who rave about their favourite product of the week, selling them online or through word-of-mouth, the real opportunity lies in gaining lifetime loyalty from shoppers and being unequivocally inclusive. The closer you can get to understanding shoppers’ feelings and needs, the more successful you’ll be, not for a single purchase, but for a lifetime.

My view is that successful Private Brands of the future may need to focus on more than mere profit, by investing more on engagement, loyalty and community to connect with their customers. An opinion supported by Forbes:

The trusted shopper relationship will become increasingly important as competition intensifies online and in-store. Private Brands are still heavily focused on National Brand Equivalents, the “me too” or competitor retailer launching those continual “match to” ranges. To stay ahead, you need to cultivate shoppers for their lifetime, offering an exclusivity of exciting products that can’t be matched or copied. It’s time to be brave. Innovate and resonate emotionally to connect with shoppers.

Natural mystique

Many Private Brands have embraced a natural offering, a greener option, a ‘Free From’, or increasingly a ‘Made Without’ alternative. The growing demand in the fitness and diet industry for natural, unprocessed food and drink is now rapidly expanding into the retail space, joining the long-standing nutrition debate. Be mindful of the growing need for mental wellbeing solutions and the rising emphasis on intergenerational health and wellness, as Gen X become the ‘sandwich generation’ (middle-aged adults caring for both elderly parents and their own children). The clean nature of your product will become a key driver in sales as retailers venture more into the Health, Beauty, and Wellness space.

This focus on freshness and the customer’s need to understand everything about a product and lifespan will rise. We already see heated debates across numerous online forums, where consumers air their annoyance if brands and retailers aren’t open and honest.  We believe traceability from raw ingredient farming to waste stream end-of-life and sustainable regeneration will be one of the biggest opportunities for Private Brands. Traceability and transparency on products will be a significant winner for all retailers if they can get the mix and the messaging right.

  Meet me at the Club

Predicting the future can be challenging, but observing luxury brands and their innovations provides valuable insights into upcoming trends. While Private Brands might not be opening exclusive high-end member clubs just yet, they can certainly take inspiration from these high-end retailers. According to the latest global insights from Passione Lifestyle, there is a noteworthy trend in luxury retail with the rise of pop-up events and private clubs. Brands like Ralph Lauren, Hermes, Prada, and Harrods are revolutionising the shopping experience, elevating it to new heights.

The key takeaway here for mainstream retailers and brands, is the concept of clubs or communities. Exclusive experiences for patron customers, making them feel special, enhancing engagement, loyalty and influencing purchase.

Creating Clubs, rebuilding real communities, and fostering member spaces in the post-pandemic era present a remarkable opportunity. With the rise of digital shopping, the demand for content-rich, experience-led online events is increasing. We’re already witnessing more exclusivity in product lines, subscription models, loyalty programs, bundled offers, and promotional deals.

Leading retailers with hugely successful Private Brand programs are finding innovative ways to create their online communities, membership programs and find new ways to welcome us into their digital clubs:

So what about physical stores?

Retail stores are fostering a more collaborative relationship with customers, ushering in a new age of service-oriented physical shopping experiences. They’re catering to consumer desires by hosting community events and involving shoppers in co-creation initiatives.

The Costco Club

Another strategy in Private Brand ‘club and community’ is Costco‘s impressive Kirkland Signature range, that offers a vast array of products.

Interestingly, Costco’s singular brand strategy has helped build a sense of exclusivity for Kirkland Signature. You can only purchase these products at Costco stores, which becomes another compelling reason to shop there. This, in turn, empowers Costco members to feel a sense of privilege and shopping savviness for choosing Kirkland Signature products, exemplifying branding at its very best.

Costco’s success with Kirkland Signature demonstrates the power of a well-executed Private Brand strategy. By offering high-quality products at attractive prices and fostering a sense of exclusivity, Costco has created a loyal customer base that drives significant revenue for the company.

As we begin to savour the exclusivity, loyalty, and develop deeper emotional connections with Private Brands, a burning question arises: Will we crave access to our favourite brands wherever we go in the world? Perhaps we’ll even enlist personal shoppers to curate and deliver our beloved brands directly to our doorstep wherever we are!

As consumers seek out brands that resonate with their values and lifestyles, Private Brands have an unprecedented opportunity to captivate hearts and minds through innovative offerings, exclusive experiences, and unwavering transparency.

The stage is set for Private Brands to redefine the shopping experience, fostering communities of loyal enthusiasts who eagerly anticipate each new product, event or club. Fasten your seatbelts, for the journey ahead promises to be an exhilarating one!

If you’re a brand or retailer and you’d like to speak to Samantha and explore how our team of Brand Catalysts can help you grow your brand through brilliant brand packaging, we’d love you to hear from you.