Indian retail brands

Being a brand evangelist, I always believed that the big brands are always consumer’s risk reducer and reduces post-purchase cognitive dissonance. But recently (few months) back, I experimented with the food private label brands at the modern trade outlets. Initially I was under the impression that the private brands were a cheap alternatives and therefore visible in copycat and generic categories. I have never tried to research or compare before the value offerings of the private labels. But then one day the retailer staff offered me to try the store brand and compare it with the much famous national brands. To my utter surprise after comparison, I could see the same quality even better in some cases after comparison, made me develop a whole new perspective towards the private label brands.

So what are Private Labels and why should we buy them?

Private label products are the retailer brand like Spencer Atta, Reliance Ketchup etc. These are brands owned by the retailer rather than the producer or manufacturer. Private label’s share in the grocery category is almost 30% of value. Though store brands are generally not marketed like the national brands, but they are giving a tough fight to them on price and customer value. According to Nielsen research, the food category alone accounts for 76 percent of the total sales in private label.


Further Nielsen report states that “while segments within the foods category like packaged rice, packaged atta and pure ghee have garnered the highest value sales, a few private-label segments are generating sales that are stronger than their modern trade equivalents.”

pvt label growth

Though the store brands do not have huge marketing budgets but are able to create a connection with the consumers. They are able to create a preference for their store brands not just on price differentiation but on consumers really want to buy it. It’s a WIN – WIN situation for both the consumer and the retailer, where consumer gets value for money and the retailers ends up with high profit margins as compared to selling a national brand.

So as an informed buyer my preference will always be the store brand when it comes to food & grocery category. I believe that they aren’t necessarily meant to be exact copies of national brand products but often, stand on their own. One reason I think they’re cheaper than their national brand counterparts is that they don’t have the marketing & advertising costs, so they’re able to skim that off the price.

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