A quiet shift is taking place in supermarket aisles across Australia as a direct result of mounting cost-of-living pressures.
More shoppers are swapping familiar big-name brands for cheaper home-brand alternatives to save on their groceries, with private label items now making up more than 30 per cent of sales, according to Coles’ latest quarterly report.
Retail expert Gary Mortimer told Yahoo News Australians are increasingly “shopping down”, with consumers embracing supermarket-owned products at record levels.
Supermarket-owned brands, like Coles pictured here, are becoming increasingly popular with shoppers. Source: Yahoo News Australia
(Yahoo News Australia)
“We’ve really seen this shift in Australia around the acceptance of home brand or private label products,” he said.
“We go back 10 or 15 years, it was around 18 per cent of sales. Now it’s over 30 per cent, so one in three products now are home brand or private label products.”
Mortimer credited supermarket giant Aldi for helping to normalise homebrand products by offering low-cost alternatives to major brands.
“As the costs of living have gotten tighter, people are looking for cheaper options,” he said.
“I think that’s one of the clear trends we’ve seen.”
New study finds similar trends across all supermarkets
A new report released this week found homebrand products are now regular staples in Aussie households, with confidence in the budget-friendly alternative skyrocketing in the past year.
The research, from Shop! ANZ and Vypr, found that shoppers aged between 25 and 34 trusted the cheaper brands more than older generations.
There were also categories where consumers were more flexible with their choices, and some areas where trusted brands still came out on top.
Household essentials and pantry staples were the most common categories where homebrands were trusted. Source: Yahoo News Australia
(Yahoo News Australia)
The data found Aussies were most comfortable buying homebrand products in:
Household essentials (70 per cent)
Pantry staples (63 per cent)
But the areas they preferred to pay more for specific items were:
This came down to shoppers finding quality and better taste more important than saving a few dollars.
Shop! ANZ General Manager Carla Bridge said the report shows shoppers are becoming more value-conscious and putting pressure on premium brands to be more competitive.
“Australian shoppers are not walking away from branded products, but they’re asking more of them,” she said.
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“The days of assuming brand loyalty will carry a product from the shelf to basket are over. Consumers are weighing up price, quality, trust and category relevance at the point of purchase, and if the premium offering is not clear, they are increasingly prepared to switch.
“This is creating a more competitive grocery environment for both retailers and suppliers,” she added.
Beauty products were one of the areas where consumers preferred to spend a little more on a branded item. Source: Yahoo News Australia
(Yahoo News Australia)
Mortimer said another noticeable shift was Aussies moving away from expensive red meat and toward poultry instead.
“I think we’ve already seen that shift. We’ve seen people move away from beef and, particularly, lamb towards chicken and other poultry. It’s so much cheaper,” he said.
“We’re doing a Sunday roast with a chicken rather than a lamb roast. We’re doing a chicken curry rather than a beef curry.”
And fast-food chains are making similar decisions.
“We’re even seeing a little bit of that with the likes of McDonald’s and Hungry Jack’s moving into chicken burgers to offset the cost of beef burgers,” Mortimer said.
McDonald’s recently launched its Dunked Korean Sticky BBQ Chicken Range, while Hungry Jack’s has pushed multiple chicken products out in the past year, including fried chicken burgers, grilled chicken burgers and saucy ribs.
They’ve also expanded snack wraps and spicy chicken options.
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