Private brands are expanding their presence in U.S. retail, with club stores and supermarkets making the biggest gains while mass retailers and dollar stores lose ground.
Club retailers posted a 0.7 percentage point increase in both dollar and unit sales for private brands over the 52-week period ending March 22. Supermarkets saw smaller but steady growth during the same time. Dollar stores and drug stores, however, lost half a point in both metrics, and mass retailers declined 0.3 points in dollar sales and 0.1 points in units.
Sales for private brands rose 4.2%, surpassing name brands, which grew 2.6%. Unit sales for store brands climbed 1.7%, while national brands edged up just 0.2%.
Price remains the main reason shoppers pick private brands, though quality, taste, and packaging have grown in importance. Trust in the brand ranks third, with 56.9% of surveyed consumers naming it a key factor—behind best value and taste.
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Preferences vary by category. Best value drives most purchases but has less influence in baby food, coffee, tea, and plant-based meat alternatives. Taste matters most for fresh meat, seafood, bakery items, and ready-to-drink beverages. Brand trust is especially important in health and beauty care.
Hannaford, a Northeast supermarket chain, updated its private label packaging earlier this year. The refresh was part of a broader effort to make store brands more appealing beyond just cost savings.
Younger shoppers show stronger interest in private brands. About 60% of Gen Z and 61% of millennials say a retailer’s store brand is very or extremely important when choosing where to shop. Overall, 43% of consumers plan to buy more private brands in the coming year, compared to 27% for name brands.
Loyalty to private brands is also higher. Only 4% of shoppers bought fewer store brands, while 17% cut back on name brands. More than half said they would keep purchasing private brands even if grocery prices fell.
Certain categories are growing faster than others. Dried meat snacks, wine, and refrigerated baked goods all saw year-over-year sales increases above 20%. Refrigerated seafood, coffee grounds, and baking items also posted double-digit gains.
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The data comes from a survey of 1,495 U.S. grocery shoppers conducted in mid-March, combined with sales figures. While price sensitivity remains high, private brands have broadened their appeal beyond just affordability.
Convenience stores showed little change in private brand performance, holding steady in both dollar and unit share. As retailers improve their offerings, store brands may continue to take market share from national brands.
The shift is most noticeable in clubs and supermarkets, where private brands already capture a larger portion of spending. Mass retailers and dollar stores now face pressure to reverse their declines or risk falling further behind.
Automation in food distribution is helping companies meet demand for private brands more efficiently. New distribution centers are adopting advanced systems to streamline operations.