There's plenty to be thankful for this Thanksgiving -- except how much it may cost you. Consumers will spend millions of dollars bulking up on Turkey Day staples, the first wave of many burdensome financial commitments this holiday season, happening at a time when the economy, to put it mildly, isn't in a grateful mood.
But there's one good way consumers can save money for Thanksgiving dinner -- they can buy store brands, also known as private labels. Those are the brands you see on the shelf at one particular retailer, but you don't see them anywhere else.
That's because brands like Great Value, Market Pantry and Culinary Circle are exclusive to Walmart, Target and Supervalu stores, respectfully. There are also growing retailers such as Trader Joe's and Aldi where nearly 100% of their inventories consist of store brands.
Because retailers don't have to pay any portion of sales from store brand products to food manufacturers like Kraft and Unilever, they can pocket more profits and at the same time charge less to the consumers, typically by about 20%-30%, says James Rushing, senior vice president and private label expert at SymphonyIRI Group, a Chicago-based market research company.The lower prices have been enticing greater consumer buy-in, particularly now. Sales of private label products at U.S. grocery stores, drug stores and big box stores are up 2.1% for the year ending Oct. 2, according to New York-based Nielsen Co., equating to an extra $1.8 billion in revenues. Overall, private label sales for the year period were $88.5 billion.
"The value is driving a lot of their behavior these days, and times are still tough with unemployment as high as it is," says Todd Hale, senior vice president of consumer and shopper insights for Nielsen. "People are trying to save money, so private label is a viable option, without question. And the value-seeking consumer is not going away," meaning the private label industry will continue to grow even when times get better.
It's not just the allure of savings that's driving increases in sales, but the way retailers are promoting and enhancing the products themselves.
"Retailers in the U.S. haven't gotten serious about private labels until the last few years," Rushing says. "They didn't have a deep assortment of private label items, and the private labels they had were perceived as or were lower quality than the branded items."
As the economy went south, more consumers bought their food from grocery stores in lieu of going out, and in general people pinched their pennies when they shopped. Hale says retailers made more room on their shelves for store brands (knocking out underperforming name brand products from the shelves in the process) and reinvested in their line-up, pitching their brands as new, improved value propositions.
Bentonville, Ark.-based Walmart Stores Inc. made a big splash last year, modifying the formula for 750 items and introducing 80 products. Batavia, Ill.-based Aldi has traditionally added about 40 stores a year since 1976, says spokeswoman Heather Tarczan, but the company has recently accelerated growth, opening between 80 to 100 stores each year since 2008, with another 80 to 100 planned to open next year. The retailer now has more than 1,100 stores in 31 states.
With better shelf placement, better market share, better marketing and better offerings, more consumers are seeing the value of store brands. According to Nielsen, 65% of surveyed consumers last year agreed or strongly agreed that store brand quality is at least as good as the name brand equivalents, while 37% said they were higher quality than name brands.
Store Brand Scorecard, an exclusive column for WalletPop's Money College blog, has discovered that several store brand products, even for Thanksgiving fixings such as cornbread stuffing and jellied cranberry sauce, do indeed taste better than the national brand, while at the same time costing less. Now that's something to be thankful for.
Since March, Store Brand Scorecard has sampled national and store brands across 35 different food and beverage categories. Here are 10 store brands worth buying over the national products. Click on the product names below to access the original Store Brand Scorecard reviews. Prices listed are applicable to the Chicago-area market and are current as of Nov. 13.
Product: Jewel Potato Chips (since renamed Shoppers Value)
Retailer: Jewel-Osco (a Supervalu store)
What We Said: "The crunch factor is slightly subdued compared with Lay's, but the saltiness is about equal, with a pleasing potato-packing aftertaste."
Store Brand Price: $1.50
National Brand Price: $3.99 for Lay's at Jewel-Osco
Product: Great Value Break and Bake Chocolate Chip Cookie Dough
What We Said: "This batch is just as good as Toll House, even with some shaved off fat and much less cholesterol (although the sodium level is higher)."
Store Brand Price: $1.98
National Brand Price: $2.25 for Toll House at Walmart
Product: Jewel Crescent Rolls
What We Said: "The savory flavor ... makes the crescent roll king."
Store Brand Price: $2.19
National Brand Price: $3.29 for Pillsbury at Jewel
Product: Great Value Original Barbecue Sauce
What We Said: "For such a low price, this sauce is definitely boss."
Store Brand Price: $1.23
National Brand Price: $1.42 for KC Masterpiece at Walmart
Product: Peanut Delight Creamy Peanut Butter
What We Said: "A touch too sweet, not as much peanut taste (as Jif), but still good."
Store Brand Price: $1.39
National Brand Price: $2.22 for Jif at Walmart
Product: Lucerne Vanilla Ice Cream
Retailer: Dominick's (a Safeway store)
What We Said: "Not quite as creamy as Dean's, but there's definitely a lovely, noteworthy vanilla taste in this ice cream."
Store Brand Price: $2.49
National Brand Price: $4.99 for Dean's at Dominick's
Product: Burman's Ketchup
What We Said: "This brand comes close to matching Heinz."
Store Brand Price: $1.19
National Brand Price: $2.46 for Heinz at Walmart
Product: Great Value Raisin Bran
What We Said: "These flakes are half the size of Kellogg's, and definitely not as crunchy or flavorful. But they've still got a pleasing wheat taste, and in the sample I had, there were at least twice the amount of raisins."
Store Brand Price: $2.50
National Brand Price: $2.98 for Kellogg's at Walmart
Product: Trader Joe's Miniature Peanut Butter Cups
Retailer: Trader Joe's
What We Said: "Hands down the best peanut butter cups of the batch (and some of the best we've ever tasted). The chocolate is rich and smooth, and the salty peanut butter lends complexity without overwhelming the flavor."
Store Brand Price: $2.99
National Brand Price: $2.94 for Reese's at Walmart
Product: Safeway Select Four Cheese Pizza
What We Said: "The (cheese) blend on this pie is a savory standout, the crust crunchy. ... We ate way more of this pizza than we should have, and had a bit of a stomach ache, but it was totally worth it."
Store Brand Price: $3.99
National Brand Price: $5.99 for DiGiorno at Dominick's
Piet Levy's Store Brand Scorecard tests a major label food product and three private label equivalents to see which brand offers the best value for the price. It appears every Monday on WalletPop's Money College page. Send suggestions, including items you want Levy to try, to moneycollege@walletpop.
10 Best Store Brands for Thanksgiving or Any Other Meal