Shoppers opting for private label products
The decline in supermarket sales volume has continued unabated in 2023, with data from market research firms showing that this drop reached 1.7% in the first quarter of the year.
At the same time, turnover has shown an increase of 8.9%, with the growth being purely inflationary, since the increase in prices per item came to 10%.
Consumers also continued to opt for private label products while developing new behaviors such as switching brands more often, picking products whose expiry date is close and are usually sold at a lower price, and buying products in bulk rather than packaged. Most purchases are made in the first fortnight of the month, then fade to a great extent, only to resume as soon as pensions are paid.
According to the data presented on Thursday by Panagiotis Boretos, vice president and managing director of market research company Circana (formerly IRI), at the Food Retail Summit 2023, the share of private label products sold during the first quarter of 2023 amounted to 17.7% (excluding Lidl), while in the corresponding quarter of 2022 it was 16.1%.
Data also show that sales of private label products are growing at three times the rate of brand name products: During the first quarter of 2023, their growth rate was 20.2% compared to the latter’s 6.7% and 8.9% for the entire market.
The sales volume of private label products increased by 4.7% in the first quarter of 2023 compared to the corresponding period last year, while at the same time that of brand name products decreased by 2.7%. Although prices of private label products grew 14.8% compared to a 9.6% rise for brand name products (Q1 2023), consumers are increasingly opting for them as they are still around 30% cheaper. The average shopping basket of brand name products from the 60 main categories of supermarket items currently costs 206.24 euros, while the corresponding basket of private label products costs €138.46.
“There is a false impression that supermarkets are winning with private label products. This is true in other European countries, as for example in Switzerland, where the Migros chain is fully vertically integrated, with its own production. In Greece, most of the chains have only commercial activity,” Nikos Lavidas, managing director of AB Vassilopoulos, pointed out at the same conference.
