This presentation provides an insight into global trends in private label with a particular focus on Western Europe as it continues to be the most highly developed private label market, while also highlighting private label penetration in Australia. The presentation discusses private label within particular countries and categories and identifies potential areas for future growth.

1. A SNAPSHOT OF GLOBAL TRENDS IN PRIVATE LABEL
PLMA WORKSHOP: WINNING WITH RETAILER PRODUCT
DEVELOPMENT SYSTEMS
ALICE YU, RESEARCH ANALYST – AUGUST 2016

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Euromonitor International: Strategic Global Market Research
A SNAPSHOT OF GLOBAL TRENDS IN PRIVATE LABEL

3. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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Private Label is worth
10% of Global Sales
=
US$350 billion
54% of Global Sales from the Western
European market
COMPETITIVE LANDSCAPE

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40
27
20
17 16 16
7
0
5
10
15
20
25
30
35
40
45
Tissue &
Hygiene
Packaged
Food
Pet Care Home CareHot Drinks Soft
Drinks
Beauty &
Personal
Care
%ValueShareofIndustry
2015 Value Share %
Western Europe
World
12
Western Europe: Private Label Highest Presence in Tissue and Hygiene
COMPETITIVE LANDSCAPE
14
12
6 6 5
3

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2015 Value Sales US$
Packaged Food Soft Drinks
Tissue and Hygiene Beauty and Personal Care
Pet Care Home Care
Hot Drinks
141bn or 74%
11.7bn
12.3bn
6.6bn 5.5bn
5.3bn
4.7bn
But Private Label in Packaged Food Leads in Actual Value Sales
COMPETITIVE LANDSCAPE

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0
5
10
15
20
25
30
35
40
45
Tissue &
Hygiene
Packaged
Food
Pet Care Home CareHot Drinks Soft
Drinks
Beauty &
Personal
Care
%ValueShareofIndustry
2015 Value Share %
Australia
Western Europe
15
20
9
8
4 4 2
Australia: Private label highest presence in Packaged Food
COMPETITIVE LANDSCAPE
40
27
17 16 16
7
20

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2015 Value Sales US$
Packaged Food Tissue and Hygiene
Soft Drinks Beauty and Personal Care
Pet Care Home Care
Hot Drinks
6602 mn or 85%
254mn
n319mn
122mn 250mn
145mn
57mn
Private label in Packaged Food also leads in Actual Value Sales
COMPETITIVE LANDSCAPE

9. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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Japan only Asian market among top 10
US leads in terms of actual private label sales
Strong growth recorded in Australia
Western Europe leads in private label presence in developed markets
CATEGORY DEVELOPMENT: PACKAGED FOOD

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South Africa a substantial market
Argentina experiencing highest growth
Low presence in China, Brazil and Mexico
Varied development of private label in emerging markets
CATEGORY DEVELOPMENT: PACKAGED FOOD

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Dairy largest in actual private label sales
Ready meals benefit from retailer innovations
Processed fruit and vegetables a mature category
Opportunities for growth in less developed food categories
CATEGORY DEVELOPMENT: PACKAGED FOOD
Dairy
Rice,
pasta
and
noodles
Confectionery
Processed fruit and
vegetables
Ready meals
Oils and fats
Processed meat and seafood
Sweet and savoury snacks
Biscuits and snack bars
Sauces,
dressings
and
condime
Baked goods
Ice
cream
and
frozen
desserts0
1
2
3
4
5
6
7
0 5 10 15 20 25 30
%CAGR2010-2015
% share in packaged food 2015
World: Private Label Value Share 2015 and Growth 2010-2015 by Category
Notes: Bubble size shows actual private label sales in category in 2015. Range displayed US$7,052-61,348 million.

13. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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• Economic PerformanceMacro Factors
• Retail InfrastructureDistribution
• Consumer DemandConsumer
Manufacturer
What Drives Demand in the Private Label Market?
MARKET DRIVERS
• Product development and marketing

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-2%
0%
2%
4%
6%
8%
10%
12%
2010 2011 2012 2013 2014 2015
RetailValueGrowth(y-o-y)
Packaged Food y-o-y retail value growth (2010-2015)
France Spain Netherlands Italy Germany
Economy: Recovering Economies Driving Pressure to Innovate
MARKET DRIVERS

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0
10
20
30
40
50
60
70
80
90
100
Valueshare%
Modern Grocery Share 2015
Retail Infrastructure: The Shift to Modern Grocery
MARKET DRIVERS
Modern Grocery: aggregation of convenience stores, discounters, forecourt retailers, hypermarkets, supermarkets

17. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
TISSUE AND HYGIENE
PACKAGED FOOD AND DRINK
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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Trends within Tissue and Hygiene: Different Ways to Premiumise
KEY TRENDS
Adding Value Packaging Claims
Multi-tiered pricing
Great Value Range Wal-Mart, Mexico
Home Signature Collection Jewel-Osco, Chicago, USA Equate Regular Pantiliners Wal-Mart, USA

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Trends within Tissue and Hygiene: Balancing Price and Quality
KEY TRENDS
Sustainability Adopting proven technology
Lidl - adoption of drylock technology in nappiesSofidel, Italy – Zero Tubo toilet paper

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•Price Segmentation
•Organic & Fair Trade
•Free From
•Provenance
•Premiumisation
Trends within Packaged Food and Drinks
KEY TRENDS

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17%
83%
Value Share Global 2015
Private Label Brands
Wider selection of organic
private label in supermarkets
Organic more accessible to
consumers
Segmentation by Lifestyle: Organic Products
KEY TRENDS
Topvalu GreenEye Organic Range

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71%
28%
0.15% 1%
Global Value Share Split of Food Intolerance
Products 2015
Lactose Free
Gluten Free
Diabetic Free
Other HW
Segmentation by Lifestyle: ‘Free From’ Products a Growing Market
KEY TRENDS

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Provenance Appeals Both to Patriotism and Local Sourcing
KEY TRENDS
Intermarché Portugal launches new
PL line with locally sourced products

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Premiumisation: Changing Private Label Stereotypes
KEY TRENDS

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Premiumisation: Private Label leading innovation
KEY TRENDS
Kin no Syokupan (Golden Bread)
Seven & I Holdings
National Brand copycat
Yamazaki Baking Co Ltd
Premium Loaf Bread Japan

26. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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BABY FOOD – Trust
CONFECTIONERY – Impulse
35% value growth
over 5 years
160% value growth
over 5 years
45% value growth over
5 years
12% value growth over
5 years
179% value growth
over 5 years
17% value growth over
5 years
GROWING MARKETS FOR PRIVATE LABEL
Categories that Promise Rewards – Unsaturated Markets

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Targeting Countries: Discounters and Growth Prospects
GROWING MARKETS FOR PRIVATE LABEL
Shifting to premium private label in saturated markets
Germany to see strong growth in specific categories
Lidl to enter US market by 2018

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Waitrose (UK) sells its private labels in
43 markets
Portuguese retailer Continente kicked off
exports of its private label in 2013. First
destination: Thailand
UK frozen foods chain Iceland exports its
products to the Middle East and South
Africa since 2012
Carrefour Romania sells its private label
in Carrefour stores in Italy and Spain
New Frontiers: Exports of Private Label
GROWING MARKETS FOR PRIVATE LABEL

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Collaboration between brands and retailers to offer:
 competitive premium private label
 an exclusive product not available elsewhere
Examples:
 UK grocery retail chain Waitrose and organic range
Duchy Originals
 Japan convenience store chain Natural Lawson and
company Bel Japon releasing a private label chilled
dessert range (Kiri brand x Natural Lawson)
Blurring of the Distinction Between Private Label and Brands
GROWING MARKETS FOR PRIVATE LABEL
Duchy Originals from Waitrose logo

31. COMPETITIVE LANDSCAPE
CATEGORY DEVELOPMENT: PACKAGED FOOD
MARKET DRIVERS
KEY TRENDS
GROWING MARKETS FOR PRIVATE LABEL
KEY TAKEAWAYS

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More sophisticated private
label segmentation
Higher potential in categories
where brand image matters
A number of markets hold
growth potential
Key Takeaways
KEY TAKEAWAYS

33. THANK YOU FOR LISTENING
Alice Yu
Research Analyst, Australasia
alice.yu@euromonitor.com
https://au.linkedin.com/in/alice-yu-18042775