The deal dominating the press these days is the merger between Kraft Foods Group and privately held H.J. Heinz, valued at about $36 billion. The tie up will create the third largest processed food company in North American and the fifth largest in the world, with annual sales of more than $25 billion.

The deal makes perfect business sense and, since we cover Kraft in Personal Finance, we believe the merged entity will be the perfect marriage of the two companies iconic brands. Between Kraft’s Mac and Cheese dinners, bologna and coffee and Heinz ketchup and Ore-Ida potato products, you have some of the best known brands coming together behind some of the best distribution networks.

While Kraft has largely been known as a North American brand with the lion’s share of its sales on this continent, more than half of Heinz’s sales are international. With each having access to the other’s shelves, brands from both companies can be more widely and effectively marketed, boosting revenue across each other’s product lines.

But why did there need to be a deal in the first place?

Both companies have struggled to grow revenues over the past several years as consumer preferences have changed. Consumers are increasingly opting for healthier fare, whether for environmental or health reasons. Processed foods such as those made by both companies are increasingly viewed by some as unhealthy, requiring preservatives to make them shelf stable and loaded with sugar, salt and carbs to make them more palatable. Other consumers are believers in the Slow Food movement, looking for products grown or made close to home to reduce carbon emissions and be more environmentally friendly.

Cost is probably a more overriding concern, though. In the wake of the financial crisis and Great Recession, penny pinching consumers caught on to the fact that generic store brand products, otherwise known as “private label,” are generally of the same quality as name brand while also much cheaper. As a result, sales of name brand products have eroded along with their value proposition. These days, 73% of consumers say that store brands are a good alternative to name brands, while 64% say they are the same quality. More than a third of consumers believe private label products are actually of better quality than national brands.

That’s opened store shelves for companies such as TreeHouse Foods (NYSE: THS), which makes private label brands for grocers around the country. Between 2009 and 2013, the private label grocery industry has grown an annualized 18.2%, today valued at more than $112 billion in sales annually. TreeHouse makes everything from soups and powdered drink mixes to salsa and pickles, most of which is package under proprietary store brand labels. On top of that, the company has its own brands such as Bay Valley Foods.

Revenue at the company has grown an average of 15.5% over the past decade, accelerating rapidly in the post-recession years as private label goods have garnered more consumer credibility. Earnings per share have averaged better than 7% annualized growth over the same period, thanks to TreeHouse products finding themselves on shelves at a growing number of retailers, ranging from Kroger (NYSE: KR) to Wal-Mart’s (NYSE: WMT) Sam’s Club.

Despite shares having gained more than 20% over the trailing year, shares have sold off recently following a disappointing earnings announcement. Last year’s sales took a steep drop in the final quarter of the year as one of the company’s major customers cut contracts with TreeHouse, opting to use a competitor instead. As the industry has become more competitive, retailers have more options for which companies to use for their store brand products. Major customer losses are a relative rarity for TreeHouse, though, so this is a great opportunity to pick up shares on the cheap.

TreeHouse also has an acquisitive history, buying up at least one competitor with complementary products in most years. As a result, the company will continue driving growth both organically, picking up more new customers on its own merits, while acquiring the book of business of acquisitions.

Major national brands such as Kraft Foods Group will remain solid investments for years to come, if for no other reason than they can continue growing through mergers and acquisitions. Investors interested in the food sector would do well to add some private label exposures to their portfolios, in recognition of shifting consumer preferences if nothing else.