---
title: "Consumption Downgrade: Rise of White-Label Brands Overwhelms Big Names"
description: "The trend of consumption downgrade has finally reached brands, with white-label brands rising rapidly to dominate the market. White-label brands, supplied directly by upstream manufacturers or channel distributors, focus on cost-effectiveness. As consumer attitudes shift, more people prefer quality affordable alternatives, giving white-label brands more market space. In recent years, the dividends of white-label products have been evident across various sectors, with food being the most representative."
author: "豆沙包"
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published: "2024-04-30"
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# Consumption Downgrade: Rise of White-Label Brands Overwhelms Big Names

> The trend of consumption downgrade has finally reached brands, with white-label brands rising rapidly to dominate the market. White-label brands, supplied directly by upstream manufacturers or channel distributors, focus on cost-effectiveness. As consumer attitudes shift, more people prefer quality affordable alternatives, giving white-label brands more market space. In recent years, the dividends of white-label products have been evident across various sectors, with food being the most representative.

The trend of consumption downgrade has finally reached brands, with white-label brands rising rapidly to dominate the market. **"White-label brands" refer to brands supplied directly by upstream manufacturers or channel distributors, focusing on cost-effectiveness.** Compared to big brands, white-label brands lack recognition, but compared to unbranded products, they offer better quality assurance. As consumer attitudes shift, more consumers prefer quality affordable alternatives, giving white-label brands more market space. In recent years, the dividends of white-label products have been fully demonstrated across various tracks, with food being the most representative. **Representative white-label food brands include "BiBiZan," "Tuogu Xia," and "Four Cats," whose sales have already surpassed many well-known brands.** In the 2023 Tmall Double 11 early bird food store popularity ranking, "BiBiZan" ranked third, only behind Three Squirrels and McDonald's. By the end of 2023, "Tuogu Xia" had a GMV (Gross Merchandise Value) of over 2 billion yuan on Douyin, making it the leading brand in the boneless chicken feet category. From early 2022 to early 2023, "Four Cats" defeated well-known brands like Luckin Coffee and Manner, becoming the top GMV in the Douyin instant coffee category. Corresponding to high sales is the low price of white-label products. On Douyin, 63 BiBiZan quail eggs cost 6.9 yuan, 1kg of Tuogu Xia boneless chicken feet costs 49.9 yuan, and a pack of Four Cats coffee costs less than 0.6 yuan. As netizens commented, **"It's not that big brands are unaffordable, but white-label brands offer better value for money."** The "Double 11 Consumer Behavior Survey Report" by 21st Century Business Herald found that consumers are becoming more rational, focusing on whether optional items meet their needs and overall cost-effectiveness, except for essential purchases. The "2023 China Consumer Insights White Paper" by iResearch shows that **80.4% of consumers prioritize cost-effectiveness and shop according to plan.** White-label brands exactly meet their "both this and that" needs. Most white-label manufacturers rarely engage in marketing and promotion, relying mainly on channels to drive sales. When facing retail enterprises' procurement, they offer very favorable prices, thus gaining favor from retailers. Especially in bulk snack stores, which focus on large quantities and low prices, they choose cheap white-label products for shelf placement. For example, in the 15 categories of Snack Youming, **white-label products account for 77% of the quantity and contribute 73% of sales.** Additionally, snack discount stores like Hi-Tego, HotMaxx, and Snack Busy have half of their products as white-label. This profit model of snack discount stores can be summarized as "brands attract traffic, white-label makes money." Besides offline retail, online e-commerce platforms are also entering the white-label track. In September 2023, the e-commerce platform 1688 launched a membership-based PLUS store, offering paid PLUS members options like Sam's Club alternatives, Miniso alternatives, and Muji alternatives, earning it the nickname "white-label supermarket." In the same month, Taobao launched "Taobao Star Origin," starting to explore white-label products from industrial chains. Since the beginning of the year, Douyin has emphasized a "ultimate cost-effectiveness" strategy, encouraging more white-label merchants to open stores on Douyin. Undoubtedly, competition in the white-label sector is fierce. The shift in consumer attitudes has provided development opportunities for white-label manufacturers. Seizing this moment, brands like BiBiZan are vying to appear on lists and enter the public eye. Offline, snack discount stores have long utilized the low-price advantage of white-label products, using brands to attract traffic and white-label to monetize, achieving a "1+1>2" effect. Online, major e-commerce platforms are amazed by the potential of white-label products and are launching new models or preferential strategies, betting on the next white-label brand to top the charts. **Besides the macro factor of changing consumer attitudes, many other important factors are driving the rise of white-label brands.** First, the development of the internet has narrowed the information gap between consumers and supply chains. Additionally, some suppliers, after scaling up, seek capitalization, and more "invisible giants" hidden behind big brands are emerging. For example, the OEM for products like sour and spicy noodles and red oil noodle skins from Three Squirrels, Beicaowei, Li Ziqi, and Liangpin Puzi is Baijia Akuan Food. The suppliers for Sam's Club's private label food are numerous, including California Fields, Lin'an Yukang Food, and Qinhuangdao Yanshan Chestnut Food for nuts. On social platforms, guides like "Collection of Affordable OEM Factories for Big Brand Snacks," "Same-Source Factory Food Reviews," and "Inventory of Well-Known Brand Suppliers" are everywhere. **In e-commerce live streaming, hosts patiently explain white-label products, dispelling shopping doubts and resolving information asymmetry, making users willing to buy.** Second, China's food industry chain is extremely mature, providing hard conditions for the rise of white-label brands. On one hand, new brands can use infrastructure like OEM factories to quickly enter the market. On the other hand, many food factories, while doing OEM, can also create their own brands because the production threshold for food is not high; most only require changing the brand, packaging, and specifications. **Of course, the most important factor is the proactive attitude of manufacturers.** Relying solely on consumers searching for "white-label" or "affordable alternative" information is not enough to help manufacturers climb the sales charts. White-label manufacturers should adjust prices, expand channels, and increase promotion to make themselves the choice of consumers. For example, the coffee brand "Four Cats" initially developed on traditional e-commerce channels, then shifted to Douyin e-commerce in 2021, which is more friendly to new brands, and built its own account matrix. The snack brand "BiBiZan" also hit a bottleneck, with monthly sales of multiple products struggling to exceed 500,000. The 6.9 yuan for 63 quail eggs became a turning point for BiBiZan. At that time, BiBiZan began associating with a large number of influencers, and this quail egg product successfully achieved monthly sales of over 10 million, with 76.7% of sales coming from influencers. The boneless chicken feet brand "Tuogu Xia" associated with over 27,000 Douyin accounts, over 123,000 live streams, and 21,000 videos, achieving monthly sales exceeding 100 million. **From these practical cases, it can be seen that for white-label brands to enter the public eye, they not only need high cost-effectiveness but also need to work on promotional channels.** More obscure white-label food brands mainly rely on bulk snack stores, fighting together. The bulk and loose-sale model weakens brand visibility in retail scenarios, as consumer perception is replaced by category, making this model more friendly to white-label brands. Of course, white-label brands are not stable and will not remain "white" forever. Currently, the white-label track in the market has shown clear differentiation, including leading manufacturers and ordinary ones. **Leading white-label brands, relying on high cost-effectiveness and channel investment, have carved out a place in niche areas and shown a trend toward branding.** "BiBiZan" last year announced its first spokesperson, Guli Nazha, and cooperated with the TV drama "Love is in the Camp" for snack placement. Ordinary white-label brands may "make a quick profit and run." For many food OEM factories, brand management is not their strength. Most manufacturers choose to imitate popular categories in the market and quickly move to the next product after the trend passes. This style of "make a quick buck and leave" is not conducive to long-term sustainable operation and can easily lead to integrity issues. Especially in the food industry, making short-term profits and then quickly disappearing makes quality hard to trust, invisibly exacerbating food safety issues and brand counterfeiting. Although white-label products are cheap, consumers still need to carefully discern quality, incurring more intangible costs.

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