Europe Showcasing the Importance of Premium Positioning

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Europe Showcasing the Importance of Premium Positioning

According to new research from Mintel Global New Products Database (GNPD), Europe accounted for over half (57%) of all private label launches with premium claims globally in 2017. This was followed by North America and the Asia Pacific with a 22% and 16% share, respectively. Overall, only 11% of all global private label food and drink launches carried a premium claim in 2017, showcasing the importance of premium positioning in Europe compared to other regions.

Katya Witham, global food and drink analyst at Mintel, comments, “Private label has reached a new stage in evolution as consumers expect these products to be on a par with, or even surpass, the quality of national brands. With shoppers’ attitudes continuing to evolve, retailers are looking to upgrade their private label ranges as consumers shift from a purely low price approach to weighing a product’s overall value proposition.”

Germany and France seem to be the most accepting of premium private label food and drink ranges: 41% of German and 37% of French consumers have purchased these products in the three months before the survey was conducted in early 2018. In France and Poland, more consumers have purchased a premium private label product (37% in France, 35% in Poland) than a value private label product (29% and 28%, respectively).

Even though the price is no longer the only reason for consumers to purchase private label, it is still an important consideration for many. Over seven in ten consumers in key European markets (80% of German, Italian and Spanish, 77% of French and 76% of Polish consumers) state that they compare prices between branded and own label products.

Europeans also overwhelmingly agree that the quality of private label products has improved over the last few years, with 80% of Spaniards stating that this is the case. The rest of Europe is not far behind, with Italian (75%), German (73%) and French (72%) consumers also showing strong support for this statement. Half of those in France (51%), Poland (51%) and Germany (50%) also say that buying own label products is ‘something a smart shopper would do’.

Witham concludes, “Private label is one of the main areas where retailers can create a point of differentiation and stand out in an increasingly competitive retail market. There are ample opportunities for retailers to use premiumisation to capitalise on shoppers’ increasingly sophisticated tastes and to redefine consumer retail brand expectations.

“With conscious consumption going mainstream, premium private labels with provenance, heritage ingredients, and craft credentials can justify a higher price tag for many consumers.”

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