Private label represented 64% of sales volume across Europe's top six grocery markets in the 12 months to February 2024, new data from Circana has revealed.

Overall, across all FMCG, volume sales declined by 1.2%.

According to Circana's Category Signals Monitor, which tracks approximately 175 FMCG categories and 2,000 product segments, private label volumes are up two percentage points on the corresponding period last year.

Strategies deployed to drive volume sales include a ramp-up in promotional intensity, Circana's data shows, with 15% more promotions than this time last year.

This has resulted in the slowing of the decline in volume sales as we entered the new year – indeed, in the first three months of 2024, volume sales grew marginally, at +0.7%.

Promotion Penetration

Around 21% of FMCG products are now sold on promotion, according to Circana.

Private-label promotions were up 36% in hypermarkets and 25% in supermarkets, Circana noted, while at discounters, the volume of items sold on promotion was up by 68%.

Addressing Volume Losses

"Reflecting on the response to increasing volume losses in 2023, we can see that it was national brands that fired the promotional starting gun all along," commented Ananda Roy, Senior Vice President Strategic Growth Insights EMEA, Circana.

"As a result, retailers followed suit, strategy- and consumer-focused. However, as both manufacturers and retailers rush to boost volumes through price reductions and increased promotions, the expected effect is likely to be dampened by high absolute prices, low innovation, competitive response, and increasing private label penetration."

Roy cautioned, however, against the danger of "overstocking shelves with deep offers," adding that any volume growth gained through promotions is likely to be short-lived.

"True volume growth is unlikely to return by the end of this year, especially if it is based on more of the same," he said.

"Manufacturers and retailers need to look to organic growth through shopper activation, brand experience, and one of marketing's most dynamic levers, innovation." (Photo: Pexels)