Xin Ou
Research expert covering Greater China
Private label market in the U.S. - statistics & facts
More than one in five consumer goods products in the United States is a private label. Over the past six years, private brands of U.S. consumer goods have witnessed a constant growth in market share, going from 18 percent in 2019 to close to 21 percent by 2024. These products, typically manufactured or supplied by third-party companies and sold under the brand name of the purchasing company, offer a cost-effective alternative to regional, national, or international brands as they incur lower marketing expenses. Particularly during times of economic hardship, such as the current inflationary period, shoppers have come to view private label goods as an affordable choice without compromising on quality, fueling their evident growth.
Private label retail scene in the U.S.
Their sales value has experienced a similar upward trend, rising from 176 billion to close to 272 billion U.S. dollars during the same period. However, unit sales have displayed some fluctuations without the same exponential growth. This trend is reflective of the overall retail market, where both store brands and name brands have been affected. Despite this, private labels have managed to gain a larger share of unit sales, at the expense of name brands. Factors such as lingering inflation, persistently high prices, an uncertain economy and job market, and a growing emphasis on waste reduction have collectively driven U.S. consumers to reduce their overall basket size.
Edible vs non-edible private label categories
Private label products, encompassing both food and beverages and non-edible items, exhibited similar dynamics across the sector. However, the share of private labels varied significantly depending on the product category. In the food and beverages segment, for instance, private brands accounted for over 66 percent of refrigerated meat dollar sales, while only representing seven percent of salty snacks sales. Similarly, in non-edible categories, store brands held more than 86 percent of the dollar share for disposable tableware, but comprised approximately 12 percent of sales for dog food.
Consumer trends among private label shoppers
Shifting purchasing patterns have influenced consumers' perspectives on private label brands. A recent survey revealed that 78 percent of U.S. consumers are inclined to buy private label products due to their value, while 59 percent choose them based on trust in their perceived taste. Although national brands still enjoy greater popularity, preferences also differ based on the age of shoppers, with younger individuals exhibiting a stronger preference for store brands.
The convergence of changing consumer behavior, persistent price increases, and the growing occurrence of shrinkflation points towards a promising future for private labels.
