ALDI's Name Brand Is Beating Out Costco, Trader Joe's, and Others
With inflation hitting its highest rate in 40 years, grocery shoppers have changed their spending habits. Instead of grabbing name-brand favorites like Cheerios, Quaker Oatmeal, and Kraft Singles, they are opting for products that are a bit less recognizable. These days carts are filling up with items totting labels like Baker's Treat, Happy Farms, and Breakfast Best and are from none other than the German discount grocery chain, ALDI.
Almost 90% of all the items available at ALDI are under its own private label, and the chain comes out on top in terms of how much shoppers buy. About 77.5% of the company's overall sales come from these items, according to recent information from Numerator, which includes gluten-free brand liveGfree, organic label Simply Nature, and plant-based and vegan items under the Earth Grown name. Many of these can be found in the weekly ALDI Finds—a list that comes out every seven days featuring seasonal picks and popular items.
These products are becoming more popular and recognizable—ALDI brands are the fastest-growing in America between 2021 and 2022, the Numerator trend report found.
But while ALDI has the biggest share of shoppers' spending when it comes to brand purchases, other chains are seeing a bigger cut as well. In fact, 41% of shoppers said they are buying more private label brands this year, according to a study done by Food Industry Association (FMI). Besides ALDI, Trader Joe's (59.4%), Wegmans (49.4%), Costco (33.5%), and Sam's Club (30%) saw the greatest amount of private-label spending.
Many grocery shoppers don't see the switch from big name brands to private-label like ALDI as "trading down," as some of these labels have gathered a cult following. ALDI's popular Mimosa Wine landed a feature in Cosmopolitan magazine for its brunch acclaim and Costco's Kirkland brand and bakery section have their own social media pages which report new releases.