The Value Spiral

The Value Spiral is why brands in the middle are dying and how to win at the extremes. Private label hit $271 billion in 2024, growing 3.9% while national brands only grew 1%.

I’m going to keep saying the hard part out loud. Hellmann’s Mayo’s market share fell from 4% in 2022-2024, while premium-priced Duke’s Mayo climbed 3% since 2021. Premium is taking share upmarket, and private label is taking share downmarket. Legacy mid-tier brands are struggling. Not from poor execution. From being stuck between premium with fences and value with superiority.

AND Patagonia sustains premium for 50+ years. YETI maintains 3-10X pricing in coolers. Ben & Jerry’s commands premium for 47 years.

AND Estée Lauder paid $1.7 billion for The Ordinary…with most products under $10. Hershey paid $750 million for LesserEvil organic popcorn positioned at conventional prices.

Both are true. You may track these as separate forces. Ultra-premium is showing growth across categories, and value is gaining share. They’re both effects of the Value Spiral, where smart shopping is rewarded.

The middle is dying. Winners exist at both extremes. Premium with genuine fences… YETI, Patagonia, Ben & Jerry’s. Decades of sustained pricing power, brand strength, and community love. Value with genuine superiority… CeraVe, Kirkland Signature, Trader Joe’s, LesserEvil. Massive share gain at accessible pricing and rewarded with shopper loyalty.

Mass premium with neither… probably most of your portfolio. Moderate premium without defensible differentiation. Getting squeezed from above and below. Remember La Croix’s dominance and eventual discounting? Anyone can sell bubbly water with flavors.

The Value Spiral is accelerating. The extremes pulling value away from the middle. Growth at the top and the bottom with the perceived value sucked out of the middle.

Your portfolio strategy needs to reflect this. Not ‘how do we defend premium across the board?’ But ‘which brands can win at premium, which should compete at value, and which are getting crunched in the middle?’

Why is the Value Spiral happening now? Three technology changes compressed the commoditization cycle from years to months, and one big cultural attitude gave it the momentum to spin faster.

Information democratization. Formulation details spread instantly through Reddit, TikTok, ingredient databases, and co-packer relationships.

Manufacturing accessibility. Same co-packers and ingredient suppliers making premium brands will make private label. Retailers aren’t just copying anymore. They’re innovating. Ulta introducing 60+ owned-brand products in 2025, working 18-24 months ahead on trend betting.

Platform amplification. What used to be built through word-of-mouth over years concentrates in weeks. Your premium launch gets attention AND gets immediately compared to cheaper alternatives. In public. At scale.

Brands reach their moment of truth in 24-36 months instead of 5-7 years. When competitive pressure hits, and either your fences hold or they don’t.

Smart Shopping Culture. In past recessions, value-seeking carried stigma. Private label was inferior. I was ashamed to shop the generic aisle as a kid. What you bought signaled who you were.

Now 68% of consumers view private labels as good alternatives to name brands. What you buy signals how you think. Value-seeking is seen as strategic recon. “I found the dupe” signals savvy. “I’m smart enough to choose when to pay brand tax” signals sophistication. Private label is aspirational.

This cultural shift may be the biggest driver of The Value Spiral. I’m a smart shopper replacing look at how much I spent. Decades of wage stagnation created pressure. The 2008 financial crisis made trading down common. 2012 smartphone critical mass enabled visible performance. Platform amplification concentrated attention. Smart shopping gave permission.

The consumer buying Target’s Good & Gather isn’t settling. They’re signaling intelligence. The consumer buying The Ordinary isn’t compromising. They’re demonstrating sophistication and avoiding a nepo-baby tag from peers.

And the consumer still buying your mid-tier brand? They’re starting to feel silly.

That feeling is when share starts migrating.

Most of your portfolio is probably in the wrong place. Too many brands are trying to defend moderate premium without fences. It’s mission impossible to win in the middle anymore. The economics don’t work, and the competition is too good at both ends.

As a gardener, choose your planting field wisely and put up some fences.

#1 Premium with Genuine Fences. This field requires multiple interlocking defenses that can’t be copied, acquired, or manufactured. Not “brand just awareness”… actual structural advantages that sustain premium for decades. Single fences rarely hold. Think in multiples.

YETI: Cultural fences in a commodity category. 19 years maintaining 3-10X premium in coolers. Walmart matches cold specs at 50% less cost. Yet YETI sustains premium. Grassroots community (guides, fishermen, hunters as ambassadors). Tribal identity (product gets stolen as status symbol). Controlled distribution (61% DTC). Multiple fences. Product is a commodity. Brand in total is not.

Ben & Jerry’s: Cultural equity compounds over decades. 47 years of premium in ice cream (easily copied). Each flavor launch is designed for attention (Phish Food, Bernie’s Boots, etc.). But flavors aren’t fences. Progressive values verified through action. B-Corp certification. Fair Trade ingredients. Viral attention SUPPORTS fences.

The Farmer’s Dog: Operational fences. Human-grade USDA facilities (negotiated with 200+ facilities). Subscription economics. Veterinary research partnerships. Supply chain control. The result is a $1.2 billion DTC-only revenue. 5-6X pricing sustained. Multiple fences defend the brand.

So what are the fences to defend premium, and how long do they last? Here’s what’s working and how to defend for longer than the trend cycle.

Patent/IP (7-20 years) On Running CloudTec has 160+ patents, and David Protein Bars is racing to build a fence through EPG fat replacement with IP protection (TBD if defensible).

Regulatory (5-15 years) The Farmer’s Dog has human-grade facilities, and Little Spoon has EU-aligned testing.

Cultural/Heritage (decades if real) Patagonia 50+ years, Carhartt WIP 30+ years organic adoption, GT’s Kombucha 29+ years as originator.

Community (5-10+ years if genuine) Tracksmith run clubs and Trackhouse retail hubs, Athletic Brewing community before retail, and Yeti’s foundation of outdoor enthusiasts.

Operational (3-7 years) Blueland refill model, YETI controlled distribution, LesserEvil vertical integration.

Founder Authenticity (while engaged) We know the stories of what happens when the founder checks out.

The portfolio question to answer. Do you have genuine fences for each brand claiming premium, or are you coasting on legacy awareness? If competitors launched functionally identical products at 30% less tomorrow, what would you defend with?

If the answer is just “brand awareness” or “we’ve been around a long time”… you don’t have fences. You have borrowed time.

Now that value-seeking is reframed from “cheap” to “strategically intelligent,” there is money to be made at lower price points. The brands that are winning celebrate it. The Ordinary, claiming, “We’re exposing the markup. You’re smart enough to understand formulations,” makes them allies in the quest to find the best value. LesserEvil’s “No premium tax required” nails it. I’ll decide when it’s worth paying more.

The Value Spiral is why brands in the middle are dying and others win at the high and low. Focusing on value-seeking can yield massive growth if tended wisely.

Value Price with Genuine Superiority. This planting field requires professional credibility OR radical transparency OR vertical integration OR retailer buying power enabling quality at accessible pricing. These aren’t viewed as “cheap knockoffs”… but intelligent alternatives with genuine superiority.

The Ordinary = Radical Transparency + Manufacturing Control. Estée Lauder paid $1.7 billion for the parent company of The Ordinary. While the brand ranks #2 in prestige skincare, most products are under $10 and named by ingredient plus concentration. “Niacinamide 10% + Zinc 1%” for $6. No marketing fluff. Chemistry-set aesthetic. Once you know Sunday Riley Good Genes ($85) is just lactic acid, The Ordinary’s version becomes an intelligent choice. They own labs, manufacturing, e-commerce, and retail.

LesserEvil = Conventional Prices + Vertical Integration. Hershey paid $750 million in 2025 for a brand that sells “organic popcorn at conventional prices.” Self-manufacturing creates a 20% margin advantage versus co-packers. 50% average annual growth since 2011. They grew in Whole Foods/Sprouts before approaching Walmart/Costco. Expansion beyond popcorn (Space Balls, Moonions) sustains growth. The fence is a vertical integration that competitors using co-packers can’t match.

Private Label = Retailer Buying Power + Innovation Capability. Kirkland Signature is the gold standard in quality matching premium brands at a fraction of the price, built on Costco’s power.Trader Joe’s feels like a curated destination, where everything is exclusive, with 80-85% of products being private label.Kroger Simple Truth launched over 80 protein products this year. Ulta Beauty Collection has 60+ owned-brand products launching in 2025 and is working 18-24 months ahead on trend betting.

Retailers have better economics (own the margin), better distribution (own the shelf), better data (own the customer relationship), and are finally investing in innovation and R&D.

As marketers, can any of your brands achieve accessible pricing with genuine superiority? Could you compete with professional credibility OR radical transparency OR supply chain advantages? If you can, this may be more sustainable growth than defending the middle.

Beware, value without superiority is just cheap. And “cheap” still carries stigma.

by Ryan Lynch