They exist because they have great brand recognition far better than most third party products. And the reason they are cheaper is because they sign bigger, low margin deals with suppliers who would be scared of undercutting their existing products.
A house brand is just a white-label product sold with minimal marketing other than shelf space in a store. The difference between a house brand and a branded products is marketing spend.
General Mills, for example, supplies most of the store-branded cereal products alongside its own, more-expensive/heavily marketed brands. Most US liquor is supplied by the same handful of distilleries, and most "craft" liquor is actually just the same stuff with a different label.
Amazon, for example, has more than 100 house brands. But you wouldn't know what they are...since Amazon doesn't advertise them anywhere except on their own website. And they definitely don't have better recognition or outsell their branded counterparts. (Raise your hand if you've purchased a Nike product in the last few years. Now raise your hand if you've ever purchased a Peak Velocity product?)
> They exist because they have great brand recognition far better than most third party products.
Your claim is that Athletic Works (a Walmart brand for athletic apparel) has better brand recognition than Nike and Great Value cola has better brand recognition than Coca-Cola?
> And the reason they are cheaper is because they sign bigger, low margin deals with suppliers who would be scared of undercutting their existing products.
Again, your claim is that Great Value brand sells more cola than Coca-Cola?
What's your explanation for why many people nonetheless buy the more expensive non-store brand?
They exist because they have great brand recognition far better than most third party products. And the reason they are cheaper is because they sign bigger, low margin deals with suppliers who would be scared of undercutting their existing products.