According to a report by marketing information company ACNielsen, independent retailer Aldi is driving the growth of private label in Australia with more people visiting its stores and shoppers spending more when they are there.
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ACNielsen’s bi-annual private label report, issued yesterday (10 April), showed that private label products commanded an 18% share of the value of the overall grocery market in the quarter ended December 2005.
This growth, ACNielsen suggests, has largely been driven by German discount retailer Aldi, with the private label share of grocery sales for retailers excluding Aldi remaining unchanged for the last three years at around 15%.
The report said that 99% of Australian households consistently purchased private label in the quarter, spending an average of AUD$123 on own-brand products every quarter for the last two years. In comparison, consumers who shopped at Aldi spent an average of AUD$142 in the quarter ended December 2005, an increase of 9% from the same quarter of the previous year.
“Aldi has certainly been the driving force behind growth in private label over the last year,” said Aaron Cross, director of retail client service, ACNielsen Australia. “It must be noted, however, that with new branding strategies for major retailer private label brands rolling out in coming months it is expected that these will have a more pronounced impact throughout the course of 2006.”
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By GlobalDataColes and Woolworths, hoping to emulate the success of UK supermarkets’ own brand promotions, have said that they will greatly expanded their ranges of private label products in the coming months.
The report also revealed that private label reported strongest sales in staple food categories, with over half of fresh milk, 27.8% of packages cheese and 25.8% of packaged bread sales being private label products. However, the report also identified increased consumer acceptance of private label in the personal care categories which have traditionally commanded higher levels of brand loyalty.
“The recent share gains in personal care categories are a reflection of consumers becoming increasingly confident in the quality of private label – particularly where young families are concerned,” noted Cross. “Further opportunity exists for retailers to grow Private Label in health and beauty categories, and also targeting non-family demographics who currently represent 60% of the Australian population.”
