Major shift to private-label personal care purchases noted in new survey

DALLAS — In the first half of 2010, consumers continued to shift to less-expensive private-label products in all categories, including the personal care and baby care segments, according to a recent survey by Epsilon Targeting, a provider of consumer information for targeted marketing solutions.

According to the August survey by Epsilon Targeting, an increasing number of consumers switched to store-brand products in the previous six months. In fact, 61% said they switched to private-label personal care products, including shampoo and facial moisturizers, while almost 18% of the respondents said they moved to private-label baby goods, including baby shampoo. These categories historically have a higher perceived cost of switching because consumers believed they are sacrificing on quality, according to Epsilon Targeting.

The brand shift is a marked increase over Epsilon Targeting's last survey, in May 2009, when 51% of respondents said they purchased private-label personal care products, and 13% bought baby items.

The gain by store brands in the personal care category is especially noteworthy because consumers tend to be more loyal to national brand shampoos, facial moisturizers and other "appearance" products, according to Epsilon Targeting. For instance, 37% of respondents said they moved to private-label shampoo and conditioner in the past six months, based on Epsilon Targeting's research. Traditionally, this is a small category for store brands — less than 3% of all shampoos and 1% of conditioners purchased at supermarkets in the third quarter were store brands, according to the Private Label Manufacturers Association, through The Nielsen Co. Among drug store shoppers, the figures were 5% and 4%, respectively.

Epsilon Targeting's findings are supported by PLMA data that showed unit sales of store-brand shampoos and conditioners did rise in the third quarter, by almost 71% and 13%, respectively, at drug stores alone.

Still, national brands linger in the minds of shoppers, as indicated by the research. At least 45% of respondents said they would definitely purchase their usual label of personal care, food or household products again if they had a coupon. More than 44% said they would buy their usual brand of health products.

"This is an opportunity for national brands to turn to their vast resources and find new ways to engage their customers one-to-one," stated Epsilon Targeting VP Warren Storey. "National brands have the ability to leverage rich data in new ways, across all communication channels from direct mail to mobile. The information is there — where their shoppers buy, when and how they respond to promotions. As the economy returns, national brands must leverage this intelligence and apply it to pricing, product placement and special offers. Marketers must leverage this data to identify and provide incentives, such as coupons and samples, to consumers who would switch back."

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