The food and beverage industry, all CPG for that matter, faces trust issues in 2025, and it presents competitive risks for national brands. WSL shopper surveys show that most consumers feel manufacturers care less about quality now than they used to. Shrinkflation and higher prices add to trust issues. Here’s how we can help.

Big-Brand Trust Challenges are Opening Doors to Retailer Brands

Nearly six in 10 shoppers believe companies care less about product quality, according to our 2024 How America Shops® study, “The Impact of TLC (Trust, Love, Caring) on Retail Sales,”. As a direct result, more than half of all shoppers are switching brands.

Much of this brand switching is benefitting store brands, an opportunity retailers are not ignoring. According to  FMI, the Food Industry Association 90% of grocers plan to invest more in private brands in the next two years.

In a 2023 How America Shops® survey among 2,500 shoppers, we learned that shoppers’ perception of store brands had already improved. Over eight in 10 shoppers then believed that the quality of store brands is just as good as national brands, and three-quarters said they recommend them to friends and family.

This presents long-term challenges for national CPG brands as many consumers have already decided “modern” store brands offer savings without compromising on quality.

Consider these additional findings from our How America Shops® “The Impact of TLC” shopper survey:

• Inflation is a key contributing factor behind shoppers’ decisions to try store brands: Six in 10 shoppers are switching brands due to high prices.
• Due to “shrinkflation” six in 10 shoppers say they now “buy specific brands less often because the package sizes have gotten smaller while the price has stayed the same or gone up” However, seven in 10 say when they find a new brand they like, they stick with it,
• While higher prices are one reason brand loyalty is waning in categories like food, beverage and snacks, the perception of declining quality– and perhaps a lack of innovation to justify higher prices –also contributes . Prices are up, packages are lighter, and there’s nothing on the labels that says products have improved.

Where Is Brand loyalty?

Age matters: Gen Z shoppers are more likely than average (by 5 percentage points) to say they’re switching brands more often because of high prices. (We wonder: Is this a temporary economic challenge or a life-forming habit for Gen Z?) Boomers are 5 percentage points less likely to stop buying a brand due to high prices. (not surprising as our research shows that older shoppers are generally more financially secure than younger ones.)

So what to do? Show you care more.

Here’s what national brands can learn from some of the most innovative retail brand strategies, based on our How America Shops® studies and Retail Safari® Innovation research:

Retailers that rank highest in our WSL Strategic Retail Caring Scores are: Trader Joe’s, Costco, Whole Foods, Sam’s Club, The Vitamin Shoppe, closely followed by Bath & Body Works and Aldi. Consider how all of these offer a curated, accessible, affordable mix, with a significant emphasis on quality own brands. So ask your retail partners what roles you can play with on-shelf knowledge, product presentation, and in-store navigation to create a “caring” experience.

Trader Joe’s ranked highest among the twenty retailers we tested in our Caring Index for the sentiment that “this retailer cares enough to offer healthier choices I can afford.” Many national brands offer value-priced alternatives, but don’t shout out how well these brands perform – even against store brands. National brands make a statement; tell your story more effectively.

High prices do not equal high value to consumers. Shoppers gave low-priced Aldi the highest rating of all tested retailers on “good value for the money I spend at this retailer,” even beating Walmart. As Aldi U.S President Dave Rinaldo told Progressive Grocer in late 2024: “We are in the sampling kitchens all the time. That’s the obsessive focus on quality. And we’ve understood for a long time that if you don’t get that part of it, the rest of it’s a pretty hollow proposition.”

Declining Quality + Shrinkflation + Inflated Prices = Lost Sales. And Lost Loyalty. So Change the Formula!

Stay tuned for updates on consumer sentiments in the coming months. Until then, you can purchase our How America Shops® report, “The Impact of TLC (Trust Caring and Loyalty) on Retail Sales” to learn more about our caring scores and how to deliver what shoppers want from key major retailers and brands.