New research from Circana confirms that private label brands reached $330 billion in U.S. sales. These brands now hold 24% of units sold. They also claim 23% dollar share of the overall consumer packaged goods market. Two reports reveal that private label has shifted from a cost-saving alternative into a premium, innovation-driven category pillar.
The first report, Category Transformation or Simply Competition: A Global Private Label Perspective, examines regional strategies across the European Union, Australia, and the U.S. The second, Private Labels in the U.S.: Meeting Consumers Where They Are, delivers a deeper analysis of the domestic trends fueling this surge.
Club Channels Lead the Private Label CPG Growth Charge
In the U.S., the food and beverage sector continues to lead this expansion. Private label products now account for 24% of the value share in food and beverage aisles. However, the sharpest momentum is emerging beyond the traditional grocery aisle.
Club channels now drive private-label CPG growth, accounting for nearly half of private-brand growth as consumers seek value. As a result, shoppers are seeking bulk-value formats that offer both quality and savings. Meanwhile, retailers in the club space are effectively capitalizing on this heightened demand for value-driven options.
National grocers are also accelerating private-label gains more quickly than their regional counterparts. According to Circana’s data, larger chains are expanding their store brands more aggressively, leveraging scale and supply chain advantages. Consequently, smaller regional players cannot match these advantages, giving larger chains a competitive edge in the market.
This trend aligns with broader market data. Private label brands captured a record 21.2% of dollar sales and 23.2% of unit sales in the first half of 2025, growing 4.4% versus 1.1% for national brands. The competitive gap continues to widen.
Gen Z Rewrites Brand Loyalty Rules
Younger consumers are fundamentally reshaping private label CPG growth in ways that go far beyond price sensitivity. Circana’s research identifies Generation Z as a primary driver of momentum. Moreover, these shoppers now see store brands as high-quality, identity-aligned choices. As a result, they no longer view store brands as compromises, but instead as preferred options.
A striking 71% of Gen Z consumers say they sometimes or always buy cheaper versions of name-brand products. Meanwhile, 46% of Gen Z shoppers are willing to spend more on private-label products, compared with 23% of Baby Boomers.
For Gen Z in the U.S., store brands like Kirkland Signature and Trader Joe’s represent purposeful choices blending style, value, and identity. These labels now fulfill the role that traditional brands once held for older generations, a significant generational shift in brand perception.
Retailers are responding by expanding their portfolios to include premium, functional, and wellness-focused lines. New store-brand lines now compete directly with established national brands, reflecting the changing expectations of today’s consumers.
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Innovation Fuels Premium and Wellness Segments
Private label CPG growth is no longer limited to value-priced staples. Circana’s research highlights that elevated private brands are experiencing outsized innovation, particularly in indulgent snacking, functional beverages, and wellness-oriented product lines.
Sustainability is also moving from buzzword to business driver. The emphasis on sustainable packaging and private label innovation is deeply embedded in the 2025 CPG landscape. Retailers are introducing new private-label products that mirror the trends found in emerging CPG brand innovation.
Circana’s Lauren Hazenfield, industry advisor at the firm, emphasized the strategic importance of authentic consumer connection. “As private brands mature, staying aligned with shifting consumer needs is essential, but inspiring shoppers is what will set leaders apart,” she said. “Our research indicates that building authentic, deeper consumer connections — especially through wellness, sustainability, and meaningful experiences — is essential for retailers looking to create long-lasting trust and loyalty.”
Premium store-brand products now account for 40% of total spend, up 3.8 percentage points since 2019. Meanwhile, Numerator data shows that this shift indicates store brands are trading up with shoppers, not just capturing budget-conscious buyers, highlighting their broader appeal.
Consumer Trust Reaches Parity With National Brands
One of the most consequential findings in Circana’s research involves quality perception. Consumers now report trusting store brands as much as name brands, a development that previously would have seemed unlikely just a decade ago.
According to FMI’s 2024 Power of Private Brands report, 71% of U.S. shoppers believe private-label quality is equal to or better than that of national brands. Moreover, trust in store brands correlates directly with trust in the retailer itself, creating a powerful halo effect that benefits the entire private label portfolio.
More than half (53%) of global respondents say they are increasingly purchasing private-label products, according to NielsenIQ’s 2025 Global Outlook report, reinforcing that this is a structural shift rather than a temporary trend.
Europe Maintains a Strong Lead Globally
While U.S. private-label CPG growth is accelerating, the European Union remains the world’s most mature market. Circana’s global report shows that EU private labels maintain a 50% unit share, with particularly strong performance in Spain and France.
Private labels now account for more than 20% of global CPG value sales, with a 1.4 percentage point increase in 2024 alone. Across markets, retailers are building distinct brand equity through investments in product innovation, clean ingredients, and sustainable sourcing, strategies that are increasingly mirroring the playbooks of major national brands.
The Road Ahead: Balanced Growth in a Competitive Landscape
Despite the historic gains, Circana’s research cautions against assuming the acceleration will continue indefinitely at the same pace.
“As we look ahead to 2026, the outlook for private label remains positive, though more balanced,” said Sally Lyons Wyatt, global executive vice president and chief advisor at Circana. “While we anticipate continued unit share growth, the pace will likely be more measured as private label transitions from an acceleration phase into a normalized growth cycle.”
Lyons Wyatt noted several key drivers remain strong, including household financial pressures and improved quality and trust. In addition, Gen Z adoption and the influence of loyalty and exclusivity continue to shape the market. Nevertheless, she acknowledged that national brands are not standing still. They are stepping up innovation, sharpening pricing strategies, and amplifying their digital and social media engagement in direct response.
Industry analysts predict store-brand revenue will reach $277 billion in 2025. Furthermore, Kearney’s 2024 report forecasts these brands could capture 7% more market share from national brands by 2030.
For food retailers navigating this landscape, Circana reports make one thing clear: private label CPG growth is no longer a defensive play. Instead, it is now an offensive strategy. Therefore, retailers who invest in innovation, wellness, and consumer connection will define what store brands mean for future shoppers.