More Consumers Pick Private Label

by Mark Friedman  on Monday, Aug. 1, 2011 12:00 am  

Sales of retailers’ private-label items have taken off during the Great Recession.

Private-label penetration has grown from 15 percent before the Great Recession to more than 18 percent of total sales in 2010, according to the Oct. 27 report “Forever Frugal? 2010 U.S. Consumer Survey Confirms Persistent Frugality” by the management consulting firm Booz & Co.

And private-label items will continue to gain support, the report said.

“When the economy rebounds, we expect private label sales will remain strong and branded consumer packaged goods may find it difficult to regain their market share,” the report said.

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Consumers have turned to private-label brands because it gives the perception of value while still branding the product, said Craig Douglass, a partner in InFocus LLC of Little Rock, a focus group research company.

“Dillard’s had done an excellent job of [promoting] private-label [items] in order to draw customers in and present a good product at a reasonable value,” he said.

Dillard’s Inc. of Little Rock doesn’t release sales figures for its private-label items. But for the past several years, the sales penetration of Dillard’s private-label items has held steady between 22 and 24 percent.

Dillard’s spokeswoman Julie Bull declined to comment on private-label sales.



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