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What lies ahead for Private Brand?

Taking customer loyalty to the next level
6 mins 57s


July 2024

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.

The quest for profitability has pushed many retailers to take more control of the ebb and flow of their supply chain. However, strong brands have learned that their growth strategy must be more than about profit.

Rachel Hadaway,
Store Brands

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:

With a fiercely competitive field of options for customers, simply offering a high-quality product or service is often no longer enough to set your brand apart.
To truly stand out and build lasting relationships with your customers, you need to create an emotional connection that resonates with them on a deeper level.
This is where an emotional engagement strategy comes in, crafting an experience for your customers that drives engagement, loyalty, and advocacy [3].

Greg Kihlstrom,

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.

Brands need to incorporate safety, hygiene and responsibility into every aspect, from design and product development to marketing and online strategies. 

Samantha Lee,
Sun Branding
What lies ahead for Private Brand? image

Whole Foods Markets ‘Sourced for Good’ program is a great example of this, originally exclusive to produce and floral, it has expanded into the grocery aisle with the inclusion of 13 of its own Private Brand coffee blends. This initiative involves collaboration with third party certifiers to ensure responsible sourcing, making improvements to the lives of farm workers and supporting communities where products are sourced.

What lies ahead for Private Brand? image

The consumer demand for transparency regarding product content integrity and lifecycle is only going to increase and become more radical. Take The Fresh Market, a US retailer that operates 160 stores across 22 states, and typically carries more than 400 items in its produce departments. With Chris Romano, Vice President of Produce and Floral stating, “We consider ourselves produce gurus,” with a successful focus on freshness and quality.

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 focus is shifting from simply selling upmarket products to affluent clients, and is evolving to champion the connection between brand and consumer through in-person events and cultural experiences; think fine dining, creative workshops and live music that unite the brand’s patrons like never before.

Isabelle Clark,
Passione Lifestyle

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:

What lies ahead for Private Brand? image

Walmart is a prime example of a leading retailer responding to this opportunity. As a Walmart+ member, customers enjoy benefits including free delivery from store, member prices on fuel at select stations, and the use of mobile scan & go,  plus a growing set of innovative experiences, like booking travel and adding streaming services.

What lies ahead for Private Brand? image

Amazon also leads in this space, with its Flywheel strategy, continually enhancing customer loyalty by tailoring products to customer preferences. AmazonBasics taps into what Private Brand can do online, offering a range of products from electronics to home goods that are often more affordable yet maintain the quality customers expect from Amazon.

What lies ahead for Private Brand? image

Another interesting trend in Private Brand loyalty is breaking out of the traditional store globally through online and small format stores. Global demand for Waitrose Private Brand products has skyrocketed by 92% over the past decade as they have expanded into new international markets [4]. More than 2,000 of their Private Brand products are now available worldwide, spanning chilled, frozen, pantry staples, and health and beauty lines. Their value-focused Essential Waitrose line – the largest value range of any grocer, their premium Waitrose No.1 brand, Waitrose Duchy Organic, and their Free From and plant-based selections are all in high demand globally.

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.

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