AUSTRALIA | Shoppers are still turning to private label to manage grocery costs, but promotions are proving the more common savings strategy as own-brand growth slips behind the wider grocery market.
Circana found 66 percent of shoppers surveyed were relying on promotions or specials to manage concerns about rising prices, while 36 percent said they were buying more private label or home brand products to save money.
More shoppers said they would rather stock up on specials, compare prices or shop around than increase their purchases of supermarket own brands.
The promotional gap is significant. Circana found just 4 percent of private label grocery items were sold on promotion in the 12 months to early January 2026, compared with 39 percent of all packaged grocery units.
Private label has gained ground in Australian grocery over recent years, particularly across pantry, bakery and frozen food. Almost two-thirds of shoppers surveyed, 65 percent, said supermarket brands were a good alternative to branded products, up five percentage points since 2021.
However, Circana's latest figures suggest that growth advantage has narrowed.
Excluding tobacco, total grocery spending increased 4.2 percent in the six months to March 2026, slightly ahead of private label growth of 4 percent. Grocery unit volumes increased 1.6 percent over the same period, compared with 1.1 percent for private label.
The result breaks a four-year pattern in which private label spending had been growing around 2.6 percentage points faster than the grocery market overall.
Performance also varied considerably by category. Over four years, private label gained 2.5 percentage points of spending share in pantry products, 2.1 points in bakery and 2 points in frozen food.
Its share fell by 3.4 percentage points in produce and 5.2 points across some other fresh food categories. Circana also reported growth in premium supermarket ranges.
That category split is important because the research shows shoppers are not defining value by price alone.
While 49 percent of shoppers said getting the lowest price was extremely important when deciding whether a product represented good value for money, 55 percent said consistently good product quality was extremely important.
Price-focused shoppers spent 6 percent more on private label than the average shopper and bought 9 percent more private label units.
By comparison, shoppers who said they were willing to pay more for better quality spent 8 percent less on private label than average, despite spending 4 percent more on groceries overall.
Jules Green, Director, Food & Grocery and Growth Enabling Teams at Circana, said Australians had not stopped buying home brands but were becoming more selective about how they saved money.
“Value isn’t always about choosing the cheapest product and a familiar brand on a strong promotion can be just as compelling as switching to a cheaper alternative,” Green said.
Green said private label had become a normal part of the weekly shop for many Australians, while growth in premium supermarket ranges showed own brands did not always need to compete on price alone.
For retailers and branded suppliers, the figures point to a more complex value equation. Private label remains established across the grocery basket, but promotions continue to play a major role in how shoppers respond to cost pressure, while quality is carrying at least as much weight as the lowest price for many consumers.
Read more here.
