• by Sarah Mahoney  @mahoney_sarah, April 5, 2010

Wall Street may be celebrating sunnier skies ahead, but the average supermarket shopper isn't sold on the recovery yet: Most say the economy isn't any better, and they're sticking with their commitment to buying private-label products as a way to lower grocery bills.

In a poll of 800 supermarket shoppers, conducted by GfK Research for the Private Label Manufacturers Association back in February, 80% say they see no improvement in the economy, and 40% say they think it's gotten worse. And they're even more likely these days to shy away from name brands in favor of private-label.

About 39% say the current economy is a "very important" factor when they buy a store brand, and 62% say they intend to purchase more private-label products going forward. When asked if they had recently ditched a national brand purchase in favor of a generic purchase, 43% say yes.

A year ago, only 35% said they had done so. Some 57% describe themselves as frequent purchasers of private-label goods, up from 55% a year ago -- a percentage that is consistent across gender, income and age.

Awareness of the extent of private-label options, however, is highest among younger shoppers, with 72% of those in the 18-24 group saying they are more aware of private-label products than they were a year ago, compared with 55% of those age 65-plus.

They're also happy with those choices: 97% say store brands compare favorably to pricier national brands; 49% say very favorably. (In its June survey last year, only 26% agreed with the "very favorably" assessment.)

Those gains, of course, aren't just fueled by economic concerns: As stores like Walmart, Target, Safeway, and Whole Foods continue to expand and upgrade private-label offerings, consumers are also responding to greater variety and quality.

As a result, Nielsen reports that sales of store-brand products now top $86.4 billion a year across the major U.S. retail channels over the past year. In supermarkets, they have a unit market share of about 24%, and a dollar share of 18%.

"Store brands accounted for 90% of the sales growth in supermarkets," says the PMLA in its report, "adding $1.5 billion in incremental sales (+2.9%), while national brand sales were virtually flat for the year at +0.1%."

Of course, generics aren't the only way shoppers are saving bucks: the survey also found that 69% say they are still looking for discounts by buying larger sizes or quantities; 67% are seeking more coupons and promotions; and 36% say they are considering changing the stores and types of stores they use for groceries.