Does the category determine Private Label success?

Posted by Oliver Koll on Feb 18, 2021

Private Labels (PL) have become a dominant part of the market in some categories but are still tiny in others. If specific characteristics of a category (e.g., involvement, risk, price-quality perceptions, social signaling, innovation) defined the fate of PL in a category then we would expect to see the same categories across countries to lead or lag the average. We examined the PL shares of 87 categories relative to the total country PL share across 19 countries. The figure (on the right) shows for each category the average difference between the category PL share and the country PL share, and the range of the differences across countries.

Frozen vegetables is an example of a category with typically higher PL share compared to the country average.

Across all 19 countries the PL share of frozen vegetable is 26% higher than the country average. However, this difference shows high variation, ranging from only 9% to 40%. Toothpaste is an example of a category with consistently lower PL success lagging the country PL share by an average of 27% but again, that difference varies between 7% and 44%.


While the overall pattern shows that some categories are more likely to consistently experience high or low PL success, the range of the deviations indicates that PL success is not automatic. Certain categories may indeed pose more difficult circumstances, but the variation across countries proves that brands can influence their fate: If you want to understand why national brands in your categories perform relatively better in some countries than others, please get in touch.

Countries included: Austria, Brazil, Czech Republic, Germany, Indonesia, Ireland, Italy, Netherlands, Poland, Portugal, Romania, Russia, Slovakia, Spain, Taiwan, Thailand, United Kingdom, United States of America