CPG manufacturers’ and retailers’ strategies differ on private brands, Advantage survey says

Michael Browne

Consumer packaged goods innovation is rising, list price increases are waning and retailers are focused on private-brand expansion, according to a March 2023 survey of manufacturers and retailers by Advantage Solutions.

The survey found that branded product manufacturers are responding to private-brand expansion by marketing the quality of their products and launching product innovation. Their top tool for remaining competitive is off-shelf merchandising, as trade promotion activity has inched up gradually since the COVID dip.

“Manufacturer and Retailer Outlook: Spring 2023,” based on 120 responses to surveys by consumer goods manufacturers and grocery retailers, found that most retailers are addressing cost increases by increasing private-brand availability (73% named it a Top 3 strategy). They plan to expand private brands through a variety of measures over the next 12 months, with retailers saying they will focus particularly on the following steps: line extensions of existing products (42%), introducing private brands to new categories (33%) and adding private-brand products to their health-and-wellness mix (33%).

Branded CPG manufacturers’ top strategies for competing with private brands include marketing their brands’ quality, cited by two-thirds of respondents as a Top 2 strategy, launching innovation (55%) and increasing trade promotions (32%).

The survey also found:

Infographic showcasing the future of marketing trends.