October 31, 2020

Manufacturer’s brands and promotions, the most searched now in the supermarket by the Spanish


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The coronavirus pandemic has revolutionized our consumption habits due to the fact that in recent months we have eaten more at home, but we have also started filling our shopping cart online. Another of the changes that have occurred within the supermarket has to do with manufacturer brands, which accelerate their growth compared to private or distribution brands. The confinement meant a change in the trend and the distribution brand, which gained ground at the beginning of the year, slows this advance and even recedes in favor of manufacturer brands. According to data from Nielsen, if we compare data from before or after Covid-19, private label loses 1.9% market share -up to 42.4% – compared to manufacturer’s brand, which gained positions with a 1.9 more share from March to September, up 57.6%.

This turning point goes hand in hand with the increase in visits by consumers to regional supermarkets, where it is easier to find these products. «The boom in local shopping and the first weeks of confinement in which a basic product was stockpiled having to face the market very high demands contributed to growth of this type of brand ”, interprets the general director of Nielsen Spain, Patricia Daimiel. The president of Promarca, Ignacio Larracoechea, highlights this trend for his part and is convinced that it will continue in the coming months. «Following the growth of the private label in January and February, the situation changed from March with the arrival of the confinement. So far this year, manufacturer brands are growing at a rate of 10%, while distribution brands are growing at 8% ”, he emphasizes.

Larracoechea explains that the change comes hand in hand with the pandemic. “During confinement, consumers chose to buy from proximity stores or regional supermarket chains, where white label penetration is lower. The second reason is that, in a crisis situation, the consumer has opted for the brand that inspires confidence. And not because the private label is bad, but because the manufacturer’s brand has known it all its life and, therefore, it transmits more closeness. The last reason is that, because people have not been able to leave home, the money saved on leisure has been invested in pampering themselves a little more at home with these leading brands, ”he says.

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In the current moment of the second wave of the pandemic and after the offers disappeared from the shelves during the state of alarm, promotions are once again gaining prominence. «Now they have promotions play a fundamental role, especially in manufacturer brands. These promotions are in principle more efficient than in the previous crisis since they will add value to the consumer. It should be remembered that in Spain only one out of every three euros invested in promotion is efficient ”, points out Daimiel.

However, in the consultancy they believe that in the coming months there will be room for everyone. “At Nielsen, we see a price stratification in the post-covid market based on how it impacts one or another consumer. The goal now is to sayestablish a good pricing architecture to serve all segments of the population and to their different needs, so that the distribution brand and the manufacturer brand will find their accommodation in each consumer based on their economy ”.

The economic difficulties derived from the management of the pandemic as well as the increase in the savings rate due to the prevailing uncertainty influence this context. “There is no doubt that household disposable income is one of the key elements that explain the upward or downward trends in the mass consumer market, and this increase in the savings rate goes against the available balance for our purchases », Interprets Daimiel.

In the applications that help to monetize the purchase in the supermarket and that extract data from the tickets registered in their system, they confirm that consumers are now more focused on looking for offers. “Much promotion is sought both in stores and from applications that allow the purchase of favorite brands at a lower price. We spend much more time at home and the disbursement in the average basket has increased, so the consumer tries to control spending more ”, says the CEO of Gelt, Carlos Prieto.

“Consumers value promotions very much, but they are loyal to their favorite brands at the same time that they have increased the consumption of private labels since they seek to save, there is a lot of uncertainty about what will happen in the future,” he says.

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