Is it still cheaper? ISN investigates the cost of private labels in the premium era
Private labels, which have long stood out for their affordability, are now entering the premium market with improved quality and innovative offerings. This change raises a crucial question: are private label products still the cheaper option compared to national brands?
The transformation of white brands
Private label products, which traditionally focused on basic and budget products, are now diversifying into premium segments. Supermarkets are investing in premium lines including organic, plant-based and artisanal options, catering to a more discerning consumer base and competing with established national brands.
Balance between quality and price
Retailers have worked to maintain private label competitiveness by leveraging direct sourcing, simplified supply chains, and efficient production. As a result, even high-quality private label products often maintain a cost advantage over brand-name alternatives. This is particularly evident in categories such as premium snacks, dairy products and beverages.
Challenges to affordability
In certain market niches, such as specialty diet products or high-end beauty products, private labels can approach or even surpass the prices of their branded counterparts. This occurs due to smaller production scales or the inclusion of uncommon ingredients, which increase manufacturing costs.
The consumer perspective
While private labels remain a more affordable option overall, their value now encompasses more than just price. Consumers are increasingly considering aspects such as product quality, ethical sourcing and brand reputation when making purchasing decisions.
White label products continue to offer savings, although they are evolving to meet modern demands. However, the narrowing of the price gap with national brands highlights the growing importance of perceived value over absolute cost. For budget-conscious shoppers, private labels continue to offer an attractive combination of affordability and quality.
This trend underscores the changing dynamics of the grocery retail market, where innovation and competition drive choices for both retailers and consumers.