What: EY Future Consumer Index reveals 52% of Indian consumers are switching to private labels, with 70% recognising improved quality in store brands and 74% noting increased availability.

Why it is important: This significant shift in consumer behavior demonstrates how retailers' strategic investment in private label quality and visibility is reshaping brand dynamics, potentially transforming the future of retail competition.

The EY Future Consumer Index reveals a fundamental shift in Indian consumer behavior, with 52% of shoppers switching to private labels. This change is driven by evolving perceptions, as 70% of consumers now believe these brands provide better quality products that meet their needs as effectively as traditional branded options. Retailers have responded strategically, with 74% of consumers noticing increased private label options in stores and 70% observing their prominent placement at eye level. The economic impact is significant, with 69% of consumers reporting cost savings through store brands. While price sensitivity remains important, with 59% only purchasing branded products during sales, the study shows that 47% would return to branded products for superior quality or performance. The findings also indicate that 44% of consumers are willing to pay premiums for enhanced product performance, particularly in categories like clothing, beauty, and personal care.

IADS Notes: The EY Future Consumer Index findings on private labels reflect a transformative shift in retail dynamics. This trend aligns with broader industry developments, as evidenced by private brands reaching record highs in unit (23%) and dollar (20%) market shares by mid-2024. The evolution in consumer perception, with 70% viewing private labels as quality alternatives, mirrors successful strategies seen at major retailers, where Walmart launched its premium Bettergoods line while Target introduced the value-focused Dealworthy brand. The economic context is particularly significant, as retailers respond to changing consumer behavior by expanding private label offerings, with companies like Target generating over USD 30 billion in annual sales from nearly 50 private brands. This transformation extends beyond mere price competition, as demonstrated by the comprehensive approach to private label development, where retailers are investing in both premium and value segments to meet diverse consumer needs.

52% of Indian consumers are switching to private labels