Sales Share Soars... Large Supermarkets Growing Private Brands (PB)

Emart PB Sales Share 20%
Homeplus Also Increased to 4,067 Items
Diverse Range from Food to Household Goods

[Asia Economy Reporter Lim Chun-han] Large supermarkets are focusing on growing their private brands (PB). In the past, the focus was simply on ultra-low prices, but now building trusted brands through premiumization and specialization has become the core. The range of products is also gradually diversifying from food items to daily necessities.

According to Emart on the 14th, PB products account for about 20% of total sales. The representative brand, No Brand, saw sales increase from 830 billion KRW in 2019 to 1.18 trillion KRW last year. No Brand has gained popularity as a cost-effective product by minimizing expenses on packaging and advertising. Peacock’s sales also rose from 250 billion KRW in 2019 to 410 billion KRW last year, and the number of products increased from around 1,100 to 1,400. Initially focused on Korean dishes such as soups, stews, and side dishes, the range has now expanded to include Chinese, Japanese, and Italian cuisines.

At Homeplus, the share of PB products in total sales increased from 4% in 2019 to 8.6% this year. During the same period, the number of PB products grew from 2,455 to 4,067. The flagship brand is Homeplus Signature, which emphasizes quality over price. Currently, it operates 3,119 products, and last year’s sales increased by about 40% compared to the previous year.

Lotte Mart is focusing on food PB products. The PB share of total products increased from 12% in 2019 to 15% currently, and the number of PB products grew by 10%. The representative brand, Yorihada, pursues restaurant-level taste through research by a team of chef specialists and collaborations with verified popular restaurants. It currently sells about 500 products and has been recording steady high growth.

The reason large supermarkets focus on PB products is that they have freedom in selecting the shelves to display products and greater authority in price setting, which helps improve profitability. A representative from a large supermarket said, "Demand for PB products is increasing due to the trend of more home dining caused by COVID-19 and the inflationary atmosphere," adding, "We plan to continue expanding various products based on taste and quality."