The presence of private labels has been felt for many years now. It was even noted last year that private label sales grew three times faster than the manufacturer’s brands[1]. This bodes well for those who want to get into the pet food business the private label way.
Historical track
During the 70s recession in the US, many supermarkets went generic by selling packaged and canned goods with no brands. This allowed many consumers to save as these unlabeled products are spared from marketing and advertising costs that come with branded products. Though short-lived, these generic products made a big comeback in the Great Recession in the US circa 2008-2010 in the form of private labels.
At the time, generic or unlabeled products are perceived to be cheaper than branded ones. But now, that perception has changed. Private labels are now associated with high quality and value. And consumers don’t mind paying premium so long as they get their money’s worth, regardless which category (food, clothing, cosmetics, etc.) that private label falls into.
The sales growth of private label
The remarkable sales growth of private labels is also reflected in the pet food category. “Private label has long been a huge part of the pet market and private label sales of pet food and supplies combined for nearly $3 billion in sales in 2017, with pet food comprising about three-fifths of the total.”[2]
Millennials are driving the growth of private labels in general. Their attitude of getting their money’s worth and the thinking that “private label is just as good as national brands”[3] have made private label businesses thrive. And because millennials are now the largest pet-owning demographic[4], sales growth of private label pet foods is expected. “We know this generation is willing to pay more for quality products and services to improve the health and well-being of their pets,”[5] according to Bob Vetere, president and CEO of American Pet Products Association.
More than millennials having the biggest demographic of pet owners, Gen Z—the generation directly coming after them—are next. Combined, these two generations comprise 57 million pet owners or 41% of all adult pet owners population as reflected in a report, Gen Z and Millennials as Pet Market Consumers: Dogs, Cats, Other Pets[6].
Profiling of both generations shows that there is an opportunity for private labels, and a big one at that. These two generations trust smaller companies and prefer brand integrity[7]. They also heed the advice of their veterinarians when it comes to pet food[8]. These behaviors indicate that, indeed, private label is here to stay.
Is private label for you?
Bob “Jungle Bob” Smith, owner of Jungle Bob’s Reptile World, a pet specialty store in New York, has his own store brand. While around 75 – 80% of his shelf space is occupied by national brands, Jungle Bob Brand has its own space. Smith even hawks out his brand as on a par with or even better than the national brands.[9] “Starting your own private label is not for the squeamish, as there are many learning curves,” Smith said. “You have to carry a large amount of your own inventory to justify making the labels, packaging, etc.”[10]
But that load will be light if you find the right partner for your private label.
Start your journey with Addiction Foods Private Label today.
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References:
[1] https://www.nielsen.com/us/en/insights/reports/2018/total-consumer-report-march-2018.html
[2] https://www.petfoodprocessing.net/articles/12825-state-of-the-us-pet-food-and-treat-industry
[3] http://www.petproductnews.com/News/How-Pet-Retailers-are-Making-Private-Label-Lines-Stick/
[4] https://parade.com/865088/leahingram/heres-what-we-learned-at-the-pet-industrys-largest-annual-trade-show/
[5] Ibid.
[6] https://www.researchandmarkets.com/research/gjh3zg/pet_market?w=5
[7] https://blog.petcarerx.com/4-ways-gen-z-millennial-pet-owners-differ-older-generations/#
[8] Ibid.
[9] http://www.petproductnews.com/News/How-Pet-Retailers-are-Making-Private-Label-Lines-Stick/
[10] Ibid.
