Dive Brief:
- Supervalu is phasing more ingredients out of is Wild Harvest private label products, according to Store Brands. The brand is now free from more than 140 ingredients like artificial colors and flavors.
- Wild Harvest product development team regularly reviews and updates its free-from ingredient lists based on research and insights into what consumers want removed from their products. The recent review added 40 ingredients to the list of more than 100 that many consumers said they don’t want in their food.
- “Today’s consumers are more ingredient-conscious than ever. They increasingly want to know what’s in the foods they eat and the products they use,” said Bekah Swan, Supervalu vice president of private brands, said in a statement.
Dive Insight:
Grocers across the country are investing a lot of money in their private label lines. Store brands now rival name brands on both quality and price, with an annual growth rate of 1.7% during the past four years, according to Nielsen. A new report by Cadent Consulting suggests that private label dollar share could reach 25.7% by 2027, growing more than 8% from where it stands today.
About 84% of American consumers of free-from products, such as allergen-free or trans fat-free, said they purchase free-from foods because they believe those products are more natural or less processed, according to Mintel research. About 43% said free-from foods are healthier as well. Among the most important free-from claims for consumers are trans fat-free, preservative-free, GMO-free, and sodium-free.
These findings explain why Supervalu is investing in its Wild Harvest private label line. Already, 65% of the brand's 600 products are certified organic. Additionally, a growing number of the brand’s products are gluten-free. Wild Harvest also extends into the household cleaning supplies aisle, where products are free from nearly 100 commonly used chemicals.
Supervalu is far from alone in its transition to healthier ingredients. Kroger generates more than $20 billion a year from its private label brands, and has grown its Simple Truth natural and organic label into a $1.6 billion brand in just three years. The grocer actively promotes the Simple Truth line as being free from more than a hundred artificial preservatives and ingredients on product shelves, displays and in-store signing throughout the store, and other marketing means like TV ads and social media.
When developing its new private brand Uniquely J, Walmart’s Jet.com carefully examined attributes that were important to its core millennial customers, including fair trade and organic.
“About 60% of the products we launched have [organic] certification because our insight from those consumers tells us that’s a really important factor to them beyond price and quality,” Jet.com president Liza Landsman said in an interview with the digital channel Cheddar.
Aldi has pledged to provide better-for-you options as well. Last year, the company made the decision to remove synthetic colors, MSG and trans fats from all its private label products. It also expanded its selection of fresh and organic produce and meats, including launching a new brand called Never Any! meat products free of added antibiotics, hormones and other additives.
The shift in consumer perceptions of private label brands is helping retailers, which are increasingly using store brands as a differentiator and margin builder. While removing undesirable ingredients from products and transitioning private brands to cleaner labels is largely consumer-driven, it’s also critical that retailer brands keep pace with big CPG companies that are working diligently to reformulate products with cleaner labels in mind.