Private label has seen an increase in value sales across Europe over the past year, although it too hasn’t been immune to recent price increases, data from Circana reveals. A full-length edition of this article first appeared in ESM May/June 2023.
Private label has been a major beneficiary of the current inflationary context, reporting double-digit growth in some categories, however, here too increased prices have led to volume sales declines for store brands in some segments.
This equates to an additional €21.6 billion spent on private labels across the Continent. Private-label unit sales, meanwhile, increased marginally, by 0.4%, indicating the level to which prices increased across the board last year.
“Despite lowering prices, private label was unable to grow during the pandemic,” he says. “In the midst of the chaos and uncertainty, consumers defaulted to the big national brands. What you’re seeing now, however, is – despite private labels taking even higher inflationary price increases – they continue to grow.”
Let’s have a look at private-label value and unit sales across a number of key European markets and examine the macro-categories that are helping to spearhead this growth.
In France, private-label value sales increased by 7%, with an additional €2.7 billion spent in the segment last year. The increase in private-label unit sales has been relatively modest, with a growth rate of just 0.1%.
Germany – the traditional ‘home of the discounters’ – saw a significant increase of 14.6% in private-label value sales last year. This translates to an additional €8.4 billion spent by consumers on store brand items. Unit sales, meanwhile, were up by just 1.5% – again, reflecting higher prices for private-label goods.
In Italy, private-label value sales increased by 12.3% last year, accounting for a total extra spend of €2.68 billion. Private-label unit sales saw a growth rate of 2.80%. The Drinks category was a major driver of growth in private-label value sales last year, with a 17.1% increase.
The Netherlands also saw an increase in private-label value sales, with a growth rate of 9.4%, equating to an additional €817 million spent in the segment. However, private-label unit sales saw a decline of 0.8%, which indicates that while Dutch consumers are spending more on private-label products, the amount that they are actually purchasing has dropped slightly.
Like Germany, Spain has seen a significant increase in private-label value sales, with a growth rate of 14.6%. This translates to an additional €4.99 billion spent on store brands in the period. The increase in private-label unit sales is stronger than that of the other countries included in this study, with a growth rate of 3%.
Compared to other European markets, the UK has seen a relatively modest increase in private-label value sales, with a growth rate of 4.3%. This translates to an additional €1.996 billion worth of spend. In addition, private-label unit sales were negative, with a decrease of 4.6% – more than the other markets in this study.
To read the full-length version of this report, check out ESM's May/June edition.