What's in a name? Apparently, less influence than ever — at least at the supermarket.
Shoppers are increasingly opting for off-label foods instead of brand name products. Off-label foods are flying off store shelves three times faster than branded products, a trend that is expected to continue well into 2020, according to Nielsen.
"We're in the golden era for private label," Jonathan Deutsch, professor of culinary arts and sciences told Policy Genius.
These "private label" products, sometimes known as "store brands," often originate at the same manufacturer as their brand name cousins. Sometimes, the only difference between the two products is the packaging.
But don't confuse store brand/private label products with generic offerings. Generic packaging carries neither a brand or a store name on its label, instead calling attention to what's inside — often with a black moniker on a yellow or white background, such as "chips" or "cola." No frills, right?
When it comes to price, the high-to-low order is usually brand name to store brand to generic, and this can make a difference to individuals or families on a budget. As of January 2018, the United States Department of Agriculture says the average U.S. family of four spent anywhere from $561 to $1,285 on food a month.
Shopping for store brands can shave an average of 15 to 30 percent off supermarket spending, according to Consumer Reports.
So what are some items that you should always buy generic and why? What you learn about the products themselves, as well as the reasons for the price differences, may surprise you.
Are you better off buying store brands when it comes to beverages? Definitely, especially when it comes to milk or juice. If the branding doesn't tout where the milk or juice originated, it will be disclosed on the label. We can't guarantee local milk or juice will be less expensive, but it will win out for freshness. Because they're produced regionally, there is usually less processing and transportation involved than with national brands, which impacts quality.
If buying local products is out of your price range, don't overlook store brands. In fact, a panel of trained tasters told Consumer Reports that a Meijer store brand juice (37 cents/serving) tasted better than the Ocean Spray (44 cents/serving).
For some consumers, the idea of sipping a store-brand pop is enough to give them heartburn. However, results of a study published in PLoS ONE revealed that the anticipation of drinking well-known cola brands influenced taste-testers' experiences. When study participants were told the brand name of a cola they tasted, even if it was another brand, brain scans showed a more positive response. The brand labels signaled neural response cues more than the actual taste did.
When children watch television advertising for high-sugar cereals, they're more likely to ask for — and eat — the brands that are advertised, according to a 2019 study by Dartmouth-Hitchcock Medical Center. Although this comes as little surprise to most parents, the study goes on to make a connection between the eating habits young children make and their likelihood to become overweight as they age. Their brand loyalty is being developed during their most formative years.
Of course, all that advertising and fun packaging takes its toll at the register: Generics in this category, which often are bagged rather than boxed, generally cost about 40 percent less than their brand name counterparts.
Making the switch to generic gives you an opportunity to discuss things like branding, advertising and marketing with your child, and can lead to discussions about being a smarter consumer.
The FDA requires the same standards of production, ingredients and storage for generic versions of staples like flour, sugar, salt and spices. Obscure details of production aside, it's almost impossible to find a difference beyond labeling for these products.
Salt, for example, is a simple chemical compound. Beyond the usual added iodine, there isn't much variation from the recipe between store brand, generic or name brand. However, the differences in price can be astounding: An ounce of name-brand oregano, for example, can sell for almost four times as much as the generic, and the only difference is the name on the label.
Likewise, produce and precut salad mix are two more categories where corporate origin has little to do with quality or freshness. In fact, it's a good idea to ignore those little brand-name stickers altogether and go with your eyes and nose. Otherwise, you'll end up paying for the sticker, with no difference in quality at all.
A lot of advertising dollars go into making us think the newest floor cleaner, bleach detergent or dust repellent is going to start a cleaning revolution in our homes. We'll never believe how easy it is to keep a clean house, now that we have Product X!
And it's possible. Truly innovative products do comes along now and then. But the majority of the cleaning products aren't really that different from each other, which means that generic products may serve you well.
Bleach, detergents and oven cleaners all come in generic versions, and this can mean saving a dollar or more every time you buy a cleaning product. If you're really feeling thrifty, you could skip the household-cleaner aisle altogether and look into alternative methods of making your own simple cleaning solutions: Most household tasks can be accomplished with vinegar, baking soda and a little time and effort.
When you invest in a computer or home theater system, you want to make sure you're getting the best quality equipment. That means buying expensive components and A/V cables, right?
Not necessarily. In fact, those $100 media cables with the gold-plated connectors aren't going to do anything that a more reasonably priced set of cables can't do. Cheaper cables will conduct electrons every bit as easily and efficiently as more expensive wires.
Now if you're in the market for batteries, it does pay to do a little research. Brand-name batteries tend to last longer than batteries that have a low price point. The sweet spot, as far as value for your money is concerned, is somewhere in the middle. For example, store brand Kirkland Signature batteries (90 cents/pair) performed as well as name brand Panasonic Digital Power batteries ($2.84/pair).
From contact lens solution and eyedrops to cosmetics and skin care products, there's no shortage of beauty brand marketing. However, the simple truth is that there are often few chemical differences between name brand and store brand products in this category.
As cosmetic chemist and founder of beautystat.com Ron Robinson explained on his blog, "There are no rules against making an exact copy." This means that many store brands are able to sell nearly identical products for a much lower price than brand names.
Although some products, like anti-aging creams, are patented, the store brand versions are such close replications that Robinson recommends buying and trying them — and returning them if they don't live up to expectations. Walmart's Equate line of health and beauty products, for example, is regularly singled out for its quality, and other store-brand generics can be as inexpensive as they are useful.
DIY and home-improvement stores like Lowe's and Home Depot have built their reputations by supplying the tools for all kinds of projects, whether you're building a deck on the weekends or simply want to repaint your bathroom. In either case, their brands are built on marketing the idea that you can DIY your home to your heart's content.
House brands of home improvement tools (Craftsman originally owned by Sears but now Stanley Black & Decker and distributed via Lowe's; Husky and Workforce from Home Depot) are offered at significantly lower prices than high-end brand name tools. Buying these tools in "bundles" can save money, so watch for combo kits that sometimes save 30 percent over buying each piece individually. Then, once you make that first big tool purchase, stick with the brand. This enables you to use a single battery and charger with multiple tools and buy subsequent tools without a battery and charger, saving up to $50 dollars a purchase.
Legal medications — both over-the-counter remedies and prescription medications — have some of the most exacting regulations for creating and selling generic versions. The FDA requires that all store-brand medications have the same active ingredient dosage and safety measures as the brand-name meds they're replacing.
For store-brand pain relievers, and allergy and antacid medications, you've probably noticed a significant difference in pricing. For example, buying the generic version of over-the-counter medications can save consumers as much as 73 percent.
This factor — price — is the primary way that store brand medications differ from brand names. So why are brand name medications so much more expensive? They do the heavy lifting when it comes to research and development, clinical trials and marketing. According to Tufts Center for Drug Development, the cost to develop a new prescription drug is about $2.87 billion.
For 20 years after developing a new active ingredient, there is usually a patent in place that prevents competitors from producing a drug with the same active ingredient. However, when that patent period ends, the active ingredient is up for grabs, and the companies producing the new generic version can afford to give you great pricing, because they didn't spend massive resources developing and marketing the original drug in the first place.
When a new little bundle of joy arrives, he or she is usually accompanied by free samples and coupons, from manufacturers of course. And few industries are more attuned to new parents than formula-makers like Enfamil and Similac. Are they worth the price?
For some parents, the answer is yes. For others, buying a generic or store brand infant formula meets their budgetary needs. The Infant Formula Act, passed in 1980 and updated in 2014, ensures that all formulas, including store brands and other generics, are identical in the nutrition they provide and the circumstances of their manufacture. The 2014 update to the Infant Formula Act requires manufacturers to test nutrient content "in the final product stage, before entering the market and at the end of the products' shelf life," according to the FDA. It also ensures specific testing for disease-causing bacteria, like salmonella, and prompts manufacturers to prove that their infant formulas support normal physical growth.
Consumer Reports found that of the three main types of infant formula — powdered, concentrated liquid and liquid — powdered was about one-quarter of the price. A container of powdered formula is about $21 compared to liquid formulas that can range to $62 or more.
If you're stocking up on snacks and sweets, you could cut a quarter of your bill by buying store brands — and still be satisfied with how these foods taste. A 24,000-person survey by Consumer Reports found that 72 percent of those surveyed had opted for store brands in the past month, and of those, 74 percent were highly satisfied with the quality of those store brands.
In Consumer Report's taste-testing of store brand versus name brand snacks and sweets, many items came out about equal, including cheese crackers, granola bars, yogurt, peanut butter, pickles and walnuts.
But there are some generic products that consumer groups and polls have told us to avoid. Take Oreo cookies, for example. Time and again, this name brand sweet snack has beat-out its store brand competitors for texture and taste, but not price. In the end, most consumer agencies advise the curious to test store-brand foods out at home.
Dollar stores — where most items cost just a buck — always seem to make money. HowStuffWorks finds out how they do it.
- Biddle, Sam. "How (and Why) To Avoid Premium Audio Cables." Gizmodo. July 22, 2010. (Feb. 15, 2019) https://gizmodo.com/how-and-why-to-avoid-premium-audio-cables-5593784
- Consumer Reports. "Baby Formulas." May 2016. (Feb. 15, 2019) https://www.consumerreports.org/cro/baby-formula/buying-guide/index.htm
- Consumer Reports. "Best over-the-counter (OTC) drugs for common ailments."July 2013. (Feb. 15, 2019) https://www.consumerreports.org/cro/2013/07/compare-over-the-counter-drugs-for-common-ailments-consumer-reports/index.htm
- Consumer Reports. "Store-brand vs. Name-brand taste-off."Consumer Reports. October 2012. (Feb. 15, 2019) https://www.consumerreports.org/cro/magazine/2012/10/store-brand-vs-name-brand-taste-off/index.htm
- Dartmouth-Hitchcock Medical Center. "Exposure to sugary breakfast cereal advertising directly influences children's diets." Science News. Jan. 7, 2019. (Feb. 15, 2019) https://www.sciencedaily.com/releases/2019/01/190107153410.htm
- DiMassi, Joseph, et al. "Innovation in the pharmaceutical industry: New estimates of R&D costs." Journal of Health Economics. May 2016. (Feb. 15, 2019) https://www.sciencedirect.com/science/article/abs/pii/S0167629616000291
- FDA. "FDA Takes Final Steps on Infant Formula Protections." June 9, 2014. (Feb. 15, 2019) https://www.fda.gov/ForConsumers/ConsumerUpdates/ucm048694.htm
- FDA. "Generic Drugs." June 5, 2018. (Feb. 15, 2019) https://www.fda.gov/drugs/resourcesforyou/consumers/buyingusingmedicinesafely/genericdrugs/default.htm
- Hamm, Trent. "Getting Over The 'Taboo' Of Generics And Store Brands." The Simple Dollar. Aug. 23, 2007. (Feb. 15, 2019) https://www.thesimpledollar.com/getting-over-the-taboo-of-generics-and-store-brands/
- Huffman, Mark. "Don't Confuse Store Brands With Generics." Consumer Affairs. Aug. 30, 2013. (Feb. 15, 2019) https://www.consumeraffairs.com/news/dont-confuse-store-brands-with-generics-083013.html
- Kuhn, Simone, et al. "Does Taste Matter? How Anticipation of Cola Brands Influences Gustatory Processing in the Brain."PLoS ONE. April 24, 2013. (Feb. 15, 2019) https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0061569
- Ma, Myles. "Generic or brand-name? How to decide at the grocery store." Policy Genius. June 28, 2018 (Feb. 15, 2019) https://www.policygenius.com/blog/generic-or-brand-name-how-to-decide-at-the-grocery-store/
- Martin, Brett. "7 Ways To Save Money When You Buy Tools." Popular Mechanics. Nov. 5, 2015. (Feb. 15, 2019) https://www.popularmechanics.com/home/tools/g2274/how-to-save-money-when-you-buy-tools/
- Montaldo, Donna M. "Spend Less on Cereal With or Without Coupons." The Balance Everyday. Dec. 10, 2018. (Feb. 15, 2019) https://www.thebalanceeveryday.com/how-to-spend-less-on-cereal-4061193
- Nielsen. "The Rise and Rise Again of Private Label." Neilsen. 2018. (Feb. 15, 2019) https://www.nielsen.com/content/dam/nielsenglobal/ru/docs/2018.02%20-%20Global%20-%20The%20Rise%20and%20Rise%20Again%20of%20Private%20Label.pdf
- Smith, Lauren. "9 Homemade Cleaners That Actually Work, According to Cleaning Experts."Good Housekeeping. Jan. 30, 2019. (Feb. 15, 2019) https://www.goodhousekeeping.com/home/cleaning/tips/a24885/make-at-home-cleaners/
- Stanger, Toby. "How to Save Time and Money Food Shopping." Consumer Reports. May 23, 2017. (Feb. 15, 2019) https://www.consumerreports.org/food-shopping/how-to-save-time-and-money-at-the-grocery-store/
- The Dinner Daily. "Generic vs Name Brand Foods—Is There Really a Difference?" The Dinner Daily. April 23, 2015. (Feb. 15, 2019) https://thedinnerdaily.com/generic-vs-name-brand-foods-is-there-really-a-difference/
- The Editors of Publications International. "10 Green Home Cleaning Tips." HowStuffWorks. (Feb. 15, 2019) https://home.howstuffworks.com/home-improvement/household-hints-tips/cleaning-organizing/10-green-home-cleaning-tips.htm
- The Krazy Coupon Lady. "25 Name Brand vs Generic Face-Offs." April 20, 2018. (Feb. 15, 2019) https://thekrazycouponlady.com/tips/couponing/25-name-brand-vs-generic-face-offs-best-worst-revealed
- Tuttle, Brad. "Brand Names Just Don't Mean as Much Anymore." Time. Nov. 1, 2012 (Feb. 15, 2019) http://business.time.com/2012/11/01/brand-names-just-dont-mean-as-much-anymore/
- USDA. "Official USDA Food Plans: Cost of Food at Home at Four Levels, U.S. Average, January 2018." USDA. January 2018. (Feb. 15, 2019) https://www.cnpp.usda.gov/sites/default/files/CostofFoodJan2018.pdf
- Wilbert, Caroline. "How Wal-Mart Works." HowStuffWorks. (Feb. 15, 2019) https://money.howstuffworks.com/wal-mart.htm