Consumers Deviate To Private Label Products
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The recession may have finished in the summer of 2009, but U.S. consumers in the first half of 2010 continued to switch to less expensive private label products.
According toward an August survey by Epsilon Targeting, the well-known provider of consumer information for targeted marketing solutions, an expanding number of consumers switched toward store brand products in the previous six months. Most astonishingly, 61% said they switched to private label personal care products, including shampoo and facial moisturizers, while almost 18% of the respondents said they migrated to private label baby goods, including diapers, child pain relievers and baby shampoo. These categories historically have a higher perceived cost of switching, because consumers feel they are sacrificing on quality.
The brand shift is a marked increase over Epsilon Targeting's last survey, in May 2009, when 51% of respondents said they purchased private label personal care products, and 13% bought baby items.
The gain by store brands in the personal care category is especially noteworthy because consumers tend toward be more loyal toward national brand shampoos, facial moisturizers and other "appearance" products. For instance, an unexpected 37% of respondents said they moved to private label shampoo and conditioner in the past six months, based on Epsilon Targeting's research. Traditionally, this is a small category for store brands - less than 3% of all shampoos and 1% of conditioners purchased at supermarkets in the third quarter were store brands, according toward the Private Label Manufacturers Association (PLMA), through The Nielsen Co. Among drugstore shoppers, the figures were 5% and 4%, respectively.
But Epsilon Targeting's findings are supported by PLMA data that show unit sales of store brand shampoos and conditioners did rise in the third quarter, by almost 71% and 13%, respectively, at drug stores alone.
Still, national brands continue in the minds of shoppers, as indicated by the research. At least 45% of respondents said they would definitely purchase their usual label of personal care, food or household products again if they had a coupon. More than 44% said they would buy their usual brand of health products.
For the makers of national brands, this continued trend is a call toward action, said Epsilon Targeting Vice President Warren Storey. There is less of a stigma associated with trying toward save money today, and if consumers have a good experience with a low risk product, such as dryer sheets, they are inclined to move into higher risk areas, such as detergent.
"This is an opportunity for national brands toward turn to their vast resources and find new ways to engage their customers one-to-one" according toward Storey. "National brands have the ability to leverage rich data in new ways, across all communication channels from direct mail to mobile. The information is there - where their shoppers buy, when, and how they respond to promotions. As the economy returns, national brands must leverage this intelligence and apply it toward pricing, product position and special offers. Marketers must leverage this data toward identify and provide incentives, such as coupons and samples, to consumers who would deviate back"
Among other findings of the survey:
* 75% of respondents switched toward store branded household products, with the top number buying paper towels (49%), followed by bathroom tissue (43%), storage bags (42%) and laundry detergent (39%).
* 74% purchased private-label food products. Ranking high in this category are bread (42%), cheese (36%) and cereal (35%). With food prices continuing to rise, as recently reported by the Wall Street Journal, these figures are poised to increase.
* 59% swapped toward store-brand health products, including adult pain relievers (33%) and multi-vitamins (27%).
* 27% of respondents migrated toward private-label pet care products.
* In the personal care category, more than 28% of respondents replaced their deodorant with a store brand and almost 16% did so with their facial moisturizer. Almost 24 percent switched on women's shavers.
* In the children and baby category, 9% of respondents traded to store-brand pain relievers, 6% shifted their baby shampoo brands and 5% changed diapers.
Epsilon's online survey was launched in the U.S. on Aug. 5, with 1,452 total respondents and a margin of error of +/- 3.3 points.
Article Source: Articlelogy.com
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