Indians take to private labelling as value reigns supreme: Survey

Indian shoppers are prioritising value and price over brand loyalty as retailers expand private labels and enhance shelf visibility, says EY Future Consumer Index

A majority of Indian customers are now evaluating their shopping choices according to price, value and pack size, leading to a shift from brand loyalty to private label products.

 

According to the India edition of the EY Future Consumer Index, 52 per cent consumers are switching to private labels. This growing preference is transforming consumer perceptions and positioning store brands as the favoured alternative to traditional branded options.

 

As many as 70 per cent of consumers believe that private labels meet their needs just as effectively as branded products.

 

Notably, 47 per cent of the respondents expressed a willingness to return to a branded product if it offers superior taste, quality or performance, showing that quality is the driving factor for decision-making.

 

Additionally, 44 per cent of consumers indicated they would switch back to branded products for better value for money, while the same percentage of respondents are also willing to pay a premium for enhancements that improve product performance.

 

“Consumer behaviour has traditionally evolved in response to changing economic situations, but the current shifts appear to be more permanent. Retailers are confidently launching private labels and allocating prime shelf space to them while technology is enhancing the shopping experience,” said Angshuman Bhattacharya, partner and national leader, consumer products and retail sector, at EY-Parthenon.

 

Retailers are responding to this shift, with 74 per cent of consumers noticing more private label options where they shop and 70 per cent observing more private label items positioned at eye level on store shelves. 

 

Further, a significant 69 per cent of consumers said that store brands and private labels help them save money.

 

Even when brands turn to innovation and improvements like changing ingredients or formulas to create more value, 34 per cent respondents perceive them as cost-cutting measures rather than genuine innovation. Furthermore, 59 per cent of consumers indicated that they only purchase branded products when they are on sale, prioritising discounts over brand loyalty.

 

“The rapid growth of private labels is further evidenced by the rising popularity of fresh, new brands among Indian consumers. At the same time, this presents established brands with both the opportunity and the imperative to deepen their connection with consumers and explore innovative ways to stay relevant,” Bhattacharya added.