Alldi Private Label brands
- The German alcohol market is worth $51.8 billion as of 2020 and is estimated to grow at a CAGR of 1.9% between 2021-2023. Revenue generated by the sale of beer is the largest component, currently estimated at $23 billion.
- In 2019 alcohol private labels accounted for 26% of the market, valued at $13.4 billion.
- The private label wine market is forecast to grow rapidly as retailers seek to realize the higher profit margins that they offer. Private label wines yield 50%-55% in comparison to branded wines that only yield up to 35%.
- The USDA’s recommendation to suppliers trying to break into the German private label market is to utilize international trade fairs for wines and spirits. They specifically recommend Bar Convent and ProWein.
- The private label alcohol market in the USA may be a potential source of growth for the large German retailers Lidl and Aldi as they are present in the market. While in recent years the overall alcohol market only grew at an average of 1.9%, alcohol private labels have reached an annual growth rate of 17% as recently as 2017.
- There is an increasing trend of German retailers introducing non-low cost private-label alternatives, in contrast to a practice that once dominated the market. Instead, they are focusing on premium products. Premium products may refer to a wide variety of products including organic, locally produced, Fair trade certified, GMO-free, lactose or gluten free, and vegan products.
- Germany is a leader in the packaged vegan food industry, with 2018 sales reaching $1.96 billion. 15% of all new vegan products launched in the same year were done so in the German market.
- The German private label grocery sector generated $123.0 billion in revenue in 2018 and the market share of premium private label goods is expected to outpace the overall private label sector growth rate.
- According to recent estimates, premium private label grocery products may account for 20% of the growth in sales of all grocery private labels globally.
- Europe is already the leader of the premium private label grocery market, introducing 57% of all new premium private labels to market in 2017
- A 2018 survey found that the German perception of private label groceries was significantly more favorable than the global perception. 81% of Germans viewed private label products favorably compared to a global average of 70%. Additionally, 74% of Europeans claim that their perception of the quality of private label products has improved over time.
Proposed Additional Research
- Upon researching premium private label goods we learned that many of its components were in fact specialized food products such as vegan food and gluten-free products. We propose further research into the vegan private label food market in Germany as well as the gluten and lactose-free private labels that are popular in the German market as an increasing number of people are adopting these lifestyles, and those doing so for health reasons are likely to be life long consumers of these products.
- The alcohol market is made up of various products, each of which with different profit margins. We recommend further research into the beer, wine, and vodka private label products and suppliers in the German markets as well as newer products entering the private label market, fore example whiskey and rum.
- New private labels take time to become adopted by customers and a growing number of customers are turning to online shopping. We propose further research into the growth of premium and alcohol private labels amongst customers shopping online.