With private label sales jumping from 17.7% to almost 19% of the U.S. market share in just a few years, it’s clear that customers are increasingly turning to store brands over traditional name brands.
But what’s fueling this shift, and how can grocery retailers use it to their advantage? From sustainable packaging and organic options to premium products that rival big brands, private labels are evolving fast to meet today’s consumer demands.
For 2025, staying competitive means understanding these trends and knowing how private label products can impact your bottom line.
Read on to uncover the top trends driving private label growth and learn how to position your store as a leader in the market.
What Are Private Label Products, and Why Are They Trending?
Private label products, also known as store brands, are created and sold exclusively by a single retailer. They offer shoppers affordable alternatives to national brands, providing the same quality without the premium price tag.
These products are growing in popularity because they balance affordability, quality, and exclusivity. As shoppers look for more ways to save, private labels provide value without compromise, making them popular in grocery stores, specialty shops, and beyond.
Understanding how private labels differ from brand-name products is key to developing your strategy. Here’s how they stack up.
- Ownership and production control: You create and manage private labels, giving you complete control over their production, branding, and distribution. In contrast, third-party manufacturers produce and distribute name-brand products, leaving less room for customization or exclusivity.
- Pricing and cost structure: Private labels typically come with lower price tags because they avoid the hefty marketing expenses tied to big brands. This allows you to offer budget-friendly options that appeal to price-sensitive shoppers while keeping margins high.
- Brand recognition and loyalty: Name-brand products thrive on their established reputations and loyal customer base. Private labels, on the other hand, build trust over time by focusing on consistent quality and delivering value that keeps customers coming back.
- Exclusivity: Private labels set your store apart by offering products that customers can’t find anywhere else. Brand-name items are widely available across multiple retailers, so they lack the unique draw that private labels bring to your shelves.
- Quality perception: Brand-name products often enjoy a reputation for higher quality, but private labels are closing the gap by introducing premium options rivaling big players. With careful attention to quality, you can challenge these perceptions and win over customers.
- Marketing and promotions: Big brands rely heavily on advertising to stay top-of-mind, while private labels thrive through in-store promotions, strategic placement, and word of mouth. These direct tactics often feel more personal and accessible to shoppers.
- Profit margins: Private labels allow you to control pricing, often leading to higher profit margins. You can reinvest in your business by eliminating third-party markups and driving stronger financial returns.
These differences highlight why private labels are a powerful tool for building your store’s brand, attracting loyal customers, and boosting profitability.
As consumer preferences shift, private labels are stepping up with fresh ideas to meet evolving consumer demands. Here’s what’s trending in 2025 for grocery retailers looking to stay competitive.
1. Eco-Friendly Products Are Leading the Way
Shoppers are paying closer attention to how their purchases impact the planet.
Private label brands that focus on eco-friendly solutions, such as compostable packaging, reusable containers, or ethically sourced ingredients, are becoming the go-to choice for environmentally conscious customers.
Trader Joe's, for example, offers compostable coffee pods and reusable shopping bags, making it easier for environmentally conscious shoppers to reduce waste.
For your store, you could explore working with suppliers offering biodegradable packaging or even launching a recycling program to collect used containers. Partnering with local eco-friendly initiatives or highlighting certifications like FSC or Fair Trade on your private label products can also show your commitment to sustainability.
Private labels are no longer synonymous with “cheap” or “low quality.” Retailers offering premium private label lines now rival national brands by focusing on artisanal quality, unique flavors, and upscale packaging.
Costco’s Kirkland Signature sets the standard, offering products like aged cheeses and premium olive oils that feel luxurious without the high price tag.
If your goal is to attract customers looking for higher-quality goods, consider starting small. A line of hand-crafted bakery items or single-origin coffees could help you build a reputation for quality.
Work with regional suppliers to source unique ingredients or flavors that set your products apart. Upscale packaging with clear labeling of the product’s origin or special qualities, such as organic or handpicked, can further elevate your private label’s appeal.
Related Read: How To Open a Specialty Grocery Store: 5-Step Guide
3. Organic And Plant-Based Options Are Taking Off
With more shoppers embracing healthier lifestyles, organic food and plant-based products are seeing explosive growth. Private labels like Whole Foods’ 365 Everyday Value make organic and vegan options accessible to a broader audience, proving that healthy eating doesn’t have to come with a premium price tag.
To hop on this trend, start by identifying gaps in your current product offerings. Are there popular plant-based items like vegan protein snacks or dairy-free desserts missing from your shelves?
Work with manufacturers specializing in clean-label or allergen-free products to create your private label line. Be sure to include clear nutritional labels and certifications (such as USDA Organic or Non-GMO Project Verified) to build trust with your health-conscious shoppers.
4. Ready-To-Eat Meals Are a Big Hit
Time-starved customers are always on the lookout for delicious, hassle-free meal options. Private labels are stepping in with everything from pre-packaged salads to gourmet meal kits. My Own Meal®, for example, offers ready-to-eat meals designed for convenience without compromising flavor or nutrition.
As a grocery store or bodega owner, you can capitalize on this trend by offering quick, grab-and-go meals tailored to your local community. Think single-serve microwaveable dinners, freshly made sandwiches, or meal kits with pre-measured ingredients for a simple home-cooked experience.
Collaborate with local chefs or use customer surveys to identify popular meal types — comfort food, international cuisines, or health-conscious options like low-carb dinners. Highlight features like "ready in 15 minutes" or "freshly prepared daily" to make these meals even more appealing.
5. Health And Wellness Products Are in the Spotlight
Shoppers prioritize their well-being and seek private label options that align with their health goals. AmazonBasics has expanded its offerings to include health-conscious products like fitness equipment and supplements, showing that wellness isn’t limited to food.
You can cater to this demand by introducing nutrient-dense snacks, sugar-free desserts, or functional beverages like adaptogenic teas. Work with suppliers to develop innovative packaging highlighting key health benefits, such as “high in protein” or “supports gut health.”
Using tools like a health food store point of sale (POS) system) to track purchasing trends can reveal which health-conscious products are already performing well, helping you decide which private label items to introduce or expand.
Consider offering trial-sized packages for new products so customers can try them before committing. Including QR codes on labels that link to recipes, workout tips, or wellness guides can also add value for your shoppers.
6. Data-Driven Personalization Is Shaping New Products
Understanding your customers’ shopping habits can unlock opportunities to create products tailored specifically to their needs. Target’s Up & Up brand is a great example, using customer data to develop items that align with shopper preferences, like affordable cleaning products or baby essentials.
To apply this to your store, dive deep into your grocery store’s data analytics. Are your customers buying more keto-friendly snacks or stocking up on plant-based proteins? Use these insights to inform your private label strategy. You could introduce a line of low-carb crackers or create a seasonal product based on popular flavors.
Engage your customers directly by running polls or inviting feedback on social media to co-create products they’ll love.
7. Regional and Cultural Flavors Are Bringing New Appeal
Private labels tapping into local tastes or global cuisines keep grocery shopping fresh and exciting. Trader Joe’s delights its customers with unique options like Peruvian Chimichurri Rice or Middle Eastern-inspired Za'atar seasoning.
For your store, consider exploring flavors and dishes that resonate with your local community. Are there regional or ethnic spices, sauces, or snacks that could anchor your private label line?
Work with local artisans or small food producers to develop authentic products that stand out. Use storytelling on your labels to highlight the cultural roots or origins of these items, helping build a deeper connection with customers.
8. Chef and Influencer Collabs Are Making Waves
Partnering with chefs or influencers is a surefire way to elevate your private label’s profile. Forage and Feast, endorsed by Michelin-starred chef Jan Hendrik van der Westhuizen, has proven how collaboration can bring credibility and excitement to store brands.
You can replicate this success by partnering with a local celebrity chef to create a signature line of sauces or ready-to-eat meals. Alternatively, collaborating with influencers in the wellness space could help you develop trendy products like superfood blends or plant-based desserts.
Promote these collaborations with in-store demos or online content featuring the chef or influencer in action, giving shoppers a behind-the-scenes look.
Related Read: Need Supermarket Promotion Ideas? Here Are 6 To Try
9. Sustainable Packaging Is Gaining Loyalty
Packaging matters. Private labels focusing on sustainable solutions, like biodegradable wraps or minimal packaging, are capturing the attention of shoppers who care about reducing waste. Walmart’s Great Value brand is already working on reducing waste with eco-friendly packaging initiatives.
To follow suit, explore materials like biodegradable wraps or minimal packaging for your private label products. You could introduce refillable options for bulk items like nuts or grains, or switch to glass jars for pantry staples like sauces or jams.
Clearly label your products with terms like “compostable” or “100% recyclable” to communicate their sustainability benefits directly to your customers.
10. Online Shopping Is Expanding Private Label Reach
As more shoppers turn to online grocery shopping platforms, private labels are carving out space in digital aisles. AmazonBasics is a prime example, offering a wide range of private label products that dominate the e-commerce market with competitive pricing and exclusive options.
Your store can expand its reach by launching exclusive online private label bundles or featuring digital-only products that aren’t available in-store. Use data from your online sales to refine your product selection, ensuring you’re offering the items customers search for most.
Personalized recommendations on your e-commerce platform, such as “shoppers who bought this also loved…”, can further boost engagement and sales.
Build Your Grocery Store’s Edge With Private Labels
Private labels are reshaping grocery retail, giving stores fresh ways to earn customer loyalty and boost sales, with trends like eco-friendly packaging, premium offerings, and personalized choices leading the charge.
But the question is, will you be left behind or stay ahead and lead in your market?
The right tools make all the difference. IT Retail equips your store with everything needed to adapt quickly, deliver memorable experiences, and embrace private label innovation smoothly.
Schedule a demo today to see how we can help your store become a leader among your competitors.
