Consumers are gaining confidence across much of Europe, deserting private labels and returning to brands. A new Canadean report finds that while the once dominant private label juice category continues to fall, private label iced/rtd coffee is growing well.

Moderate GDP growth has been witnessed across much of East and West Europe, and with it renewed levels of consumer confidence. In West Europe this has drawn consumers back to brands, with Private Label’s share of the market dropping under 25%. East Europe tells a slightly different story however, as the share of Private Labels actually grew half a percent. This is due to the proliferation of discount chains such as Lidl and Aldi, which have helped change the preconceptions of Eastern European consumers around Private Label products. Despite these differences, Private Label categories have shown similar trends.

The fall of juice

Over Europe volumes of the historically large Private Label juice category dropped almost 7%, as its share fell to 46% in West Europe, and 10% in East Europe. “The whole juice category has been marred by the sugar debate, however premium brands such as Innocent (Coca-Cola) and Tropicana (PepsiCo) have been able to limit losses by pursuing innovative products, new flavours and coconut water”, says Tim Haig, analyst at Canadean. In addition to suffering from juice’s tarnished health claims, Private Label juice problems have been compounded by aggressive pricing strategies from the main players.

The rise of iced/rtd coffee

As most Private Labels lose share across Europe, there remains a glimmer of light in the form of iced/rtd coffee drinks. This tiny category continued its rise to prominence, growing over 7% across Europe. Whilst category awareness is being driven very much by the branded players, Private Label's were able to grow as the product gained market acceptance. Haig comments “Consumers are looking to try new, emerging products such as iced/rtd coffee drinks, but whilst they are willing to try the premium product, they want to avoid the premium pricetag, so many are opting for Private Label”. Despite Private Labels success, branded products remain firmly in control, and will only capture more market share as the economic outlook continues to improve.

Outlook for Private Labels

Canadean’s latest report suggests that a Europe of two halfs will continue, as Private Label brands in Western Europe will continue to lose share in the face of an improved economy, and discounted brands. Private Label brands in Eastern Europe on the other hand will likely continue to grow, albeit at a lower rate, as brands continue to keep their prices low.