Why Costco & Sam's Club Private Labels Are Dominating the Protein Market

What’s developing isn’t a “high-protein convenient nutrition” categorical battle between wholesale club private label and branded products…but an evolving model of coexistence! The two largest warehouse clubs in the United States each offer shoppers unique features and their own style of bulk discounting…but more recently, the biggest commonality is the effort by Costco and Sam’s Club to expand private label product assortments. In a retail landscape shaped by economic headwinds, generational turnover, and changing definitions of value, private label has become a powerhouse…not only as budget-friendly alternatives but a strategic lever for growth, shopper loyalty, and brand identity. Similarly, in an inflation-conscious landscape, shoppers are choosing private label not just because it’s cheaper…but increasingly because it also meets their evolving expectations for quality, innovation, and experience. But with private label shifting from “stigma” into a reflection of consumer values, thus moving beyond simply being placeholders for branded products…Costco and Sam’s Club are leaning into this momentum by positioning expansive store-brand expansion as a destination. But if you aren’t a Costco member, you might’ve missed that Kirkland Signature launched a whey protein powder last summer. And if you aren’t a Sam’s Club member, you likely overlooked that Member’s Mark launched an ultra-filtered milk protein shake last month. Though, recognizing that both wholesale clubs had launched high-protein bars several years earlier…you might be questioning the significance of these other convenient nutrition private label products, right? For years, Quest Nutrition defined the “high-protein bar” category…essentially building the modern protein bar. Then, both Kirkland Signature and Member’s Mark entered the space…matching Quest Nutrition on just about every product variable. The biggest difference…price! But it was a clear signal that the high-protein bar category had officially gone mainstream. Similarly, Optimum Nutrition and Fairlife are defining the “protein powder” and “protein shake” categories respectively…essentially building those modern convenient nutrition subcategories. But now, wholesale club retailers have entered the space…matching Optimum Nutrition and Fairlife on just about every product variable. Again, the biggest difference…price! But it’s another clear signal that these high-protein convenient nutrition subcategories have officially gone mainstream. But for branded CPG products…private label activity from Costco and/or Sam’s Club can feel like an attack. However, those leading wholesale club retailers are simply upholding a promise to their members. Unfortunately, whether it’s macro-related or more categorically specific factors (like persistent dairy proteins input cost inflation), consumers have increasingly searched for better value without sacrificing quality…and wholesale club private label brands will steadily take fuller advantage of this market opportunity. Finally, despite this rise in categorical private label activity…I’ll end my latest first principles content piece by highlighting how branded products can continue holding a powerful place in consumers’ hearts (and shopping carts).