MDD inflation continues to rise, study finds
Continued inflation is driving private label growth, according to new research from DataWeave. The report, titled Inflation is accelerating private label share and penetration, examines the penetration of top private label brands, categorizes brands and tracks price variations between regions, as well as private label ratings, reviews and rankings.
DataWeave, a retail analytics company, found that, on average, retailers in the United States sold over 4,500 private label products online and had private label penetration of over 13% , the category expected to grow with no signs of slowing inflation. The Private Label Manufacturers Association recently reported that private label sales hit an all-time high. $199 billion in 2021, a 1% increase from 2020.
“Across the top ten grocery retail chains we analyzed, private label was more economical than national brands, which is likely one of the biggest contributing factors to the increased penetration of private label in retail stores. grocery categories,” said DataWeave CEO Karthik Bettadapura. “We will continue to monitor private label closely, as it appears to impact many decisions throughout the retail value chain, from margins to merchandising.”
According to the report, the grocery categories with the highest inflation saw the greatest private label penetration. Private label also gained volume in high inflation food categories such as poultry, meat and frozen foods in 2021. While the total number of SKUs is much smaller as an overall category, the Meat had the highest share of private label (25%) within the analysis. The presence of private label products was lowest in the alcohol and beverage (7.2%) and beauty and personal care (7.5%) categories, indicating a strong preference for national brands.