Canadian private label consumers becoming older and wealthier, says Nielsen
Although the heaviest private label users still tend to be from larger households, with three people or more, and higher incomes, of $70k a year or more, “the face of the private label buyer is evolving to one person households, age 55 – 64 years, no kids, with incomes of $100K plus,” Nielsen said.
The market research organization’s director of industry insights Carman Allison said that retailers need to innovate to reflect the changing demographics of private label shoppers.
“This could mean an increased focus on smaller sizes or portion-controlled products, health and wellness offerings such as low fat or low sodium, and premium offerings to attract higher income consumers,” he said.
Despite private label products being on average 30 percent cheaper than national brand goods, those who buy the most private label products tend to spend more per grocery store trip than the average shopper, according to Nielsen data. And private label products account for more than a third of heavy users’ total shopping trip bills.
Nevertheless, the appeal of store brand products in Canada has not been as marked as in the United States.
“The battle of the brands continues,” said Allison. “Despite the economic downturn, Canadians did not switch from national brands to private label products. National brands are meeting consumers’ needs for value by driving more sales through feature pricing while private label increased prices at a higher rate, narrowing the shelf price advantage.”
However, he added that as the top five grocery retailers represent most of the grocery trade, there is still strong potential for development of the private label sector in Canada.
