Albertsons is set to launch its own private label brand as stores compete to offer better value.
The supermarket giant, which owns grocery stores Safeway and Vons, announced the launch of its Overjoyed brand on Wednesday.
The new label marks Albertsons’ foray into the value wars, joining companies like Walmart that use their own popular brand to promote themselves as a value brand.
German discount chain Aldi has become the fastest-growing supermarket in the US thanks to its private label.
But one retail analyst told DailyMail.com that Albertsons is taking a different tactic to its rivals: focusing on treats rather than essentials.
Overjoyed includes a variety of sweets, including cupcakes, cookies, cheesecakes, mix-ins and toppings, the company said.
Albertsons said it hopes shoppers will be tempted by “indulgent treats” such as French macarons, trail mix with s’mores and brownie ice cream cake with chocolate fudge.
Albertsons has launched its own private label to compete in the value wars
Customers are increasingly looking for value in their weekly grocery shopping after years of food inflation have hit household budgets hard.
Neil Saunders, retail director at GlobalData, told DM.com: “More and more customers are opting for private labels in an attempt to save money on their grocery purchases. Albertsons is responding to that trend.”
‘It’s interesting that the retailer has focused on treats and indulgences because this is an area where people tend to buy branded products.
‘However, as Target has shown with its candy-focused private label Favorite Day, there is a huge opportunity here.’
Albertsons said it hopes shoppers will be tempted by “indulgent treats” such as French macarons, trail mix and s’mores and brownie ice cream cake with chocolate fudge.
“For customers looking to create their own desserts, Overjoyed offers whimsical fairytale princess or dinosaur and shark sprinkles, colorful cupcake wrappers, decadent chocolate chips and marshmallows, to name a few,” Brandon Brown, senior vice president of Albertsons’ private labels, said Wednesday.
A subsection of the private label, Overjoyed Boutique, also features vases, candles and seasonal gifts.
Albertsons is the nation’s third-largest supermarket chain, operating more than 2,200 stores in 34 states.
This comes as Albertsons remains part of an ongoing antitrust lawsuit filed by the Federal Trade Commission.
The FTC is trying to stop supermarket chain Kroger from buying Albertsons.
The agency and several states argue that the planned $24.6 billion acquisition would eliminate competition, which in turn would remove control over prices.
Kroger has argued that its planned acquisition of Albertsons would actually lead to lower food prices because it would allow them to compete with conglomerates like Amazon and Walmart.
Shoppers were left furious after testimony in the case revealed that Kroger had raised its prices above inflation even as budgets were stretched.
The supermarket chain’s top pricing executive testified before a judge last month that the store raised prices on milk and eggs more than required.
“For milk and eggs, retail inflation has been significantly higher than cost inflation,” executive Andy Groff wrote in an email to his bosses in March.
“Greed is real,” one Kroger shopper wrote on X in response to Groff’s admission.
Albertsons’ Overjoyed includes a variety of sweets including cupcakes, cookies, cheesecakes, mixes and toppings.
Albertsons, which owns Safeway and Vons, is the third-largest supermarket chain in the U.S.
“I’ve noticed prices are higher than any other store (except Kroger), now we know why,” another commented.
Others said they would boycott the store because of unnecessary price increases.
“It’s absolutely disgusting,” wrote one X user, “I’ve never been to a Kroger and now no matter where I end up in life, I never will.”
If the merger goes ahead, the two chains have said they would sell about 600 stores between them in an attempt to appease regulators.
The two chains have offered to sell 579 stores in markets where they overlap to C&S Wholesale Grocers, a New Hampshire grocery supplier and operator, for $2.9 billion.
The states with the highest number of affected businesses are Washington with 124, Arizona 101, Colorado 91 and California 63.