“It may be surprising to know that SNAP households actually spend less of their CPG food and beverage dollars on private brands than non-SNAP households. [Private-label spending] is 19% for SNAP households versus 20% of dollars among those non-SNAP households. So, while SNAP households are engaging a little bit more with store brands than they have in the past — with private brand units per buyer among this group up 3.6% over the past year — that is a slower increase than we have seen for all other households who increase their private label units purchased by 5.5% over the past year,” said Daniel Joyner, consultant for Circana’s Complete Consumer division.
Some CPG companies receive ‘more than a third of their dollars at retail from SNAP households’
SNAP households account for 22% of sales across all channels in the US, with SNAP dollar share accounting for 34% in the dollar channel and 25% in mass, according to Circana data for the year ending Sept. 8. Additionally, SNAP households “are still heavily engaged with national brands,” and the dollars generated from this cohort can be a significant portion of a CPG company’s revenues, Joyner noted.
"Some of the CPG brands that we look at source even more than a third of their dollars at retail from SNAP households. ... If you are managing one of these brands, this group of customers — SNAP households — should be a focus area of your ongoing performance tracking because these consumers can have really an outsized influence on your sales in total," Joyner elaborated.
Additionally, shoppers on SNAP make more grocery trips to purchase national brands than private-label, with them making 2.5 more trips to buy national brands over private-label, he noted.
Consumers stretch grocery budget, as COVID era benefits lapse
However, SNAP household are seeking to stretch their dollars even further as COVID-related increases lapse in all states, which is boosting private label sales. SNAP participation declined 1.7% from 2023 to 2024, and 41.5 million Americans relied on SNAP so far in 2024, according to the SNAP in Action Dashboard.
SNAP households increased their spending on private label products by 3.6% in dollars and 4.3% in units, compared to dollar growth of 0.7% and 0.5% declines in units for national brands, according to Circana data for the year ending Sept. 8.
“With those changes to the program benefits over the past year, more of these households may be feeling a bit more squeezed on their budgets. So, they may be looking for more value from their purchases and turning to lower-priced private-label offerings …. If that is the case, of course, national brands may have some opportunity to win back some of that share that they have ceded by innovating on package sizing and pricing structure,” Joyner said.
‘Baking continues to [see] upticks in dollars units and even trips’
SNAP households are taking more trips to the grocery store but buying fewer items, following similar trends for non-SNAP households, Joyner noted. Produce and deli units are up for SNAP households, growing 2.6% each for the year ending Sept. 8.
The chance for private label and brands to connect around baking and dinner occasions grew among SNAP recipients, according to Sally Lyons Wyatt, global EVP and chief advisor for consumer goods and foodservice insights at Circana. Baking dollar sales increased by 5.7% and 3.2% in units, while dinner occasions saw dollar growth of 1.4% and flat units, according to Circana data for the year ending Sept. 8.
“Baking is a theme that we see within this segment every single year, so baking continues to [see] upticks in dollars units and even trips,” Wyatt said.
She added, “Dinner is one of the largest occasions that consumers spend in general, and it is also an occasion that can transcend to other occasions, like leftovers at lunch or maybe even snacking. Therefore, make sure you are messaging how your brand — whether you are a CPG or a retailer — can assist them and then offer deals that combine products for discounts or co-promotions, etc. for other occasions.”
