Research: Private Labels Hits 50% Share in Europe’s Core FMCG Markets
- DRC Discount Retail Consulting GmbH
- Apr 19
- 3 min read
Updated: Apr 29
Private-label products reached a historic unit share across major European markets, driven by inflation, digital shopping, and AI-led purchasing behaviour.
For the first time, retailer's own private branded labels have reached 50% of units sold across Europe’s leading FMCG markets — France, Germany, Italy, the Netherlands, Spain, and the United Kingdom — marking a structural turning point for the sector.
According to the latest analysis by Circana, growth has been steady since 2021, with an increase of more than three percentage points. Further gains are expected in 2026, supported by persistent inflationary pressure and the continued evolution of digital shopping.
MARKET SHARES AND PERFORMANCE
Private-label products already account for more than half of total volumes in several countries.
Country | Volume Share (%) | Value Share (%) |
Spain | 59% | 52% |
Netherlands | 56% | 55% |
Germany | 52% | 44% |
United Kingdom | 52% | 44% |
France | 46% | 36% |
Italy | 36% | 31% |
WHY SUCH A LARGE DIFFERENCE BETWEEN THE MAIN EUROPEAN COUNTRIES
Country | Volume/Value Gap (Percentage Points) | Interpretation |
Germany | 8% | Hard Discount Dominance: The "Aldi/Lidl effect" keeps prices extremely low; private label is the default for price-conscious shoppers. |
United Kingdom | 8% | Premium Expansion: While the gap is wide due to intense price wars, UK retailers lead in "premium" own-brands, which helps them maintain high volume. |
France | 10% | Promotional Pressure: France has the widest gap. National brands use aggressive promotions to compete, forcing private labels to drop prices even further to stay relevant. |
Spain | 7% | High Loyalty: Retailers like Mercadona have built private labels that consumers trust as much as (or more than) national brands. |
Italy | 5% | Brand Heritage: A smaller gap because private labels haven't yet penetrated higher-value categories like fresh deli or specialty goods. |
Netherlands | 1% | Value Capture: Remarkable efficiency; private labels here are priced and positioned almost identically to national brands. |
INFLATION AND AI ACCELERATE GROWTH
Growth is closely tied to the macroeconomic environment. Rising living costs are pushing households toward more affordable alternatives, while branded manufacturers continue to pass on price increases.
Additional growth drivers include online shopping and artificial intelligence. AI-powered retail environments increasingly prioritize products offering the best value for money, indirectly favouring private label ranges.
RETAILERS EXECUTE WINNING STRATEGY
Tracking millions of SKUs across more than 230 FMCG categories, Circana highlights how retailers have successfully maintained competitive pricing while ensuring high quality.
At the same time, assortments have expanded to include premium lines and innovative products, helping private-label products move beyond their traditional value positioning.
Private-labels are also capturing key consumer trends, including health-focused products, high-protein foods, and functional nutrition. This agility is allowing retailer brands to outperform traditional manufacturers. Digital communication is proving equally critical. Social media platforms such as TikTok enable retailers to reach younger consumers, who tend to show lower loyalty to established brands.
PRICE WAR AND PROMOTIONAL PRESSURE
The sector is experiencing intensifying promotional pressure. Currently, 34% of branded manufacturers’ sales are made on promotion, compared with just 14% for private-labels —highlighting a far more aggressive pricing strategy from producers. However, heavy reliance on promotions is becoming increasingly unsustainable, particularly in a context of already compressed margins.
KEY GROWTH CATEGORIES
Private-labels growth is primarily driven by the food and beverage sector, with particularly strong performance in ready meals, snacks, beverages, and dairy products.
The mineral water segment is also highly dynamic, supported by competitive pricing, impactful promotions, limited editions, and targeted marketing strategies. Non-food categories, by contrast, continue to face stronger competition from branded manufacturers.
OUTLOOK
Geopolitical tensions and rising costs across the supply chain — from fertilizers and raw ingredients to transport and distribution — are expected to further intensify the cost-of-living crisis in the second half of the year.
In this environment, private-label products are set to strengthen their competitive advantage, reshaping European consumer purchasing habits in a structural and lasting way.
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