Deloitte: Shoppers Shun Smaller Package Sizes and Buy Private Label

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September 13, 2011

Smart shoppers are catching on to CPG companies that shrink package size rather than raise prices, and are now looking to store brands for better value and transparent pricing, according to a new study.

Fully 74 percent of shoppers surveyed in Deloitte’s recently expanded 2011 Consumer Food and Product Insights Survey believe the sizes of some packaged foods has changed and 46 percent have changed their buying behavior as a result. Overwhelming these shoppers are turning to store brands with 64 percent saying, “I’m seeking out lower priced brands, including store brands” as a result.

Shoppers are seeking out store brands that offer better value in categories where package size is shrinking. Gas prices are also having an effect with 26 percent buying more private label products thanks to higher gas prices, 49 percent are buying lower priced items and 73 percent are making fewer trips to the store. In some instances, shoppers are simply buying less or choosing smaller sizes to save money, according to the report.

Shoppers who began buying more private label products during the recession are sticking with store brands. Approximately 58 percent of those surveyed said they had increased purchases of private label products and decreased buys of national brands. Only 26 percent of those who switched said they were returning to national brands.

The survey also revealed a clear consumer concern about recalls and defective products; 73 percent of respondents in Deloitte’s survey reported that they are more concerned now than five years ago about the food they eat, up from 65 percent in 2010. Also, more than two-thirds said they are more concerned about the personal care and home products they use today than they were five years ago. This concern is being fueled by a spate of product recalls including the most recent round of ground turkey sold as store brands.

It’s an opportunity for retailers and private label manufacturers to create stronger bonds with shoppers with informational and marketing materials, and more frequent communication about the safety and sources of store brands.

Editor's Note: Charts courtesy of Deloitte's "2011 Consumer Food and Product Insights Survey."

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