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Analyzing the effects of private-label supplier disclosure on retailer image
Abstract
Private-label retailers' disclosures of dual manufacturing agreements—that is, agreements with manufacturers that produce both their own national brands and private labels—can affect the images associated with the retailers. In this study, an experiment reveals moderating effects on retailer images, according to the images of both the national brand manufacturers and the retailers; and also depending on the brand equity of the private label. A low-image retailer's disclosure that a national brand manufacturer supplies its private label causes consumers to perceive that the retailer has a higher image. However, the positive effects of private label supplier disclosure on the retailer's image are weaker when the private label enjoys high equity.
... Consumers' perceptions of the image of store-owned brands influence their attitudes toward the brands (Collins-Dodd & Lindley, 2003). The fact that store image and trust positively influence the consumers' purchase intentions for private-label brands was further endorsed by other researchers (Konuk, 2018;Pérez-Santamaría & Martos-Partal, 2021;Semeijn et al., 2004). Further, ethical behavior enhances brand image and credibility (Carter et al., 2021;Yu et al., 2021). ...
The onset of COVID‐19 resulted in unprecedented shopping behavior, leading to product scarcity and empty store shelves, making consumers shift towards purchasing private‐label store brands. In this research, we aim to understand the role of the pandemic in influencing the preference for private‐label products. Using secondary data, we offer longitudinal evidence that although national and private‐label brand sales increased equally during the peak pandemic period, the growth rate for national brands subsided in the post‐pandemic years, but that of private‐label brands sustained its upward trend. Further, using experimental design, we test this phenomenon and find that greater availability of private‐label brands during the pandemic resulted in higher perceived brand‐helpfulness, which evoked brand attachment and persuaded the customers to continue repurchasing. Our research thus contributes by providing unique insights that can help brands strategize effectively and ensure continued brand attachment in the post‐pandemic period, and additionally, help brands retain customers and foster loyalty during crises.
... The present article also highlights that in the B2B environment, the equity of relationships between companies is fundamental for long-term success (Pasirayi & Richards, 2023;Pérez-Santamaría & Martos-Partal, 2021;Zippel et al., 2013). Relational capability helps build trust, facilitates effective communication, and helps establish strategic partnerships (Parida et al., 2016). ...
The growth of private labels and digital marketing brings new challenges to manufacturers. However, within these challenges, manufacturers can discover strategic opportunities to uphold a competitive advantage in the market. This study considers two scarce topics in the literature: the private label business from a supplier's perspective and the inclusion of the digital strategy in the B2B segment. Data collected from 203 manufacturers interviewed are tested against the research model using structural equation modelling. The results indicate that the digital strategy of the manufacturers influences their network capacity and the performance of the private label supply. Network capability also influences the performance of private labels. Digital strategy is a key element in the development of the private label supply business. Furthermore, the study mentions that companies with lower export levels tend to have less competence in private label performance. Consequently, the global presence of manufacturers has been acknowledged as a driving factor for the success of private brands, facilitating entry into international markets and expanding the customer base.
... This study uses brand images to refer to private-label product associations and their relation to SMEs as producers who are the object of research. Perceptions that are built in the minds of consumers can emerge from an assessment of quality (source) or disclosure of collaboration with privatelabel suppliers (Lamey et al., 2007;Pérez-Santamaría and Martos-Partal, 2021;Steenkamp et al., 2010). Disclosure of collaboration or information regarding suppliers and manufacturers can benefit retail by increasing the consumer perceptions, attitudes, and purchase intentions towards private-label (Cho et al., 2015;Rahman and Soesilo, 2018;Vaidyanathan and Aggarwal, 2000). ...
Private label is seen as a way to maintain profits, encourage consumption, and as a form of CSR for retail companies when empowering local small businesses. In its development, private labels have evolved into brands that pay attention to value and sustainability. A brand category in Indonesia involves SMEs as product suppliers for PLB. This study examines the influence of factors related to the store on the perception of private-label products produced by SMEs. This study collects online data from 441 Indonesian respondents who are Alfamart and Indomaret customers aged 18 or above and have shopped in the last 3 (three) months, using the non-probability sampling method with a purposive sampling technique. The collected data were tested using SEM Partial Least Squares analysis. The results reflect that store loyalty and brand image have a significant positive impact on attitudes toward buying private labels. In contrast, store loyalty and price consciousness have the least significant positive impact. On the other hand, perceived risk was was found to have a significant negative effect. The Brand Category was found to be moderating in Store Loyalty and Brand Image antecedent variables. This study is expected to be useful for academics and marketing practitioners by expanding private-label studies, especially in relation to SMEs as producers. Moreover, retailers can consider involving more SMEs in their private-label business, which will positively impact society.
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Design/methodology/approach
This study uses a scoping review approach that includes 478 retail brand articles. Subsequently, a thematic analysis method is applied.
Findings
The brand attributes that shape the distinct image of each retail brand level encompass diverse intrinsic and extrinsic attributes. Moreover, the holistic nature of a multi-level retail brand is formed by the interrelationships between the images of different levels, which are reflected in the presence of common extrinsic attributes and their interplay at attribute, benefit and attitude levels.
Originality/value
Theoretically, this review provides conceptual clarity by unveiling the multi-level yet holistic nature of a retail brand, helping researchers refine and extend existing theories in retail branding, while also providing new research opportunities in this field. Practically, the findings could guide retailers in implementing differentiated branding strategies at each level while achieving synergy across all levels.
The authors study the consequences of rebranding multiple category-specific private-label (PL) brands by “opening the umbrella” and unifying them under a common brand name. Retailers expect positive consequences that may manifest themselves in two ways: (1) an increased intrinsic brand strength and (2) an improved marketing-mix effectiveness. The authors analyze three substantially different retailers that rebranded one of their PL tiers. Consistent with the national-brand literature on umbrella rebranding, all three retailers realized an increase in the rebranded PL tier’s intrinsic brand strength, along with a reduced price elasticity. However, and in contrast to the national-brand literature, the effectiveness of both price-promoting and assortment size dropped for all three retailers after they unified their category-specific PLs under a common umbrella name.
In India growth of private label brands corresponds with the increasing share of organized retailing. The consumer perceptions of private label apparel brands of retail department stores have been examined by means of structural equation modelling approach. The model illustrates the influence of consumer perceptions towards private label familiarity, affective perception, perceived quality, perceived value, and perceived risk perceptions including functional risk, financial risk, and social risk perceptions on store loyalty. The study found that favourable consumer perceptions of apparel private label brands of retail department stores significantly influence the consumer to be loyal to the store. It implies that retailers wishing to boost loyalty to their store should formulate appropriate private label brand strategies so as to solicit favourable perceptions towards their store’s private label offerings.
The authors develop an econometric model of the relationship between a household's private-label (PL) share and its behavioral store loyalty. The model includes major drivers of these two behaviors and controls for simultaneity and nonlinearity in the relationship between them. The model is estimated with a unique data set that combines complete purchase records of a panel of Dutch households with demographic and psychographic data. The authors estimate the model for two retail chains in the Netherlands—the leading service chain with a well-differentiated high-share PL and the leading value chain with a lower-share PL. They find that PL share significantly affects all three measures of behavioral loyalty in the study: share of wallet, share of items purchased, and share of shopping trips. In addition, behavioral loyalty has a significant effect on PL share. For the service chain, the authors find that both effects are in the form of an inverted U. For the value chain, the effects are positive and nonlinear, but they do not exhibit nonmonotonicity, because PL share has not yet reached high enough levels. The managerial implications of this research are important. Retailers can reap the benefits of a virtuous cycle; greater PL share increases share of wallet, and greater share of wallet increases PL share. However, this virtuous cycle operates only to a point because heavy PL buyers tend to be loyal to price savings and PLs in general, not to the PL of any particular chain.
The competition between national brands (NBs) and store brands (SBs) has evolved from the mere imitation of
physical characteristics to what we call affect-based competition. We propose a model of moderated mediation
empirically validated on 350 participants in a field study conducted in a multi-brand store. The results show the
existence of a positive affect transfer from NBs to SBs through store image, in addition to the existence of a
negative direct relationship between NBs and SBs (affect polarization) that can be neutralized if consumers have
a positive perception of the retailer, which itself arises from promotional activity and the shelf placement of the
SB.
The aim of this study is to explore the key factors which Indian consumers considers during purchase of Private label brand products and how these identified factors impact the purchase decision of consumers towards private label brand. The research is initially exploratory in nature followed by causal research to test various hypothesis developed. The research instrument used is structured questionnaire to collect responses from different consumers in retail segment of National Capital Region (NCR) in India. Thereafter factor analysis followed by multiple regression analysis was performed. EFA explored five key factors price consciousness, quality variability, brand image, store image and self-perception. Thereafter hypothesis testing was done on explored factors to study the impact on PLB purchase decision which revealed that Brand Image is a most significant factor followed by Price consciousness, Quality Variability, Store Image whereas self-perception emerged as insignificant as it varies among different consumers.
This study develops a model to predict customer lifetime value for hypermarket private label products. It examines the relationships among store awareness, store image variables (i.e., service quality, price/value, convenience, and product quality), private label image, repurchase intention, and customer lifetime value and investigates the moderating role of image fit. The originality of this study lies in filling the gap of previous research on antecedents of private label customers’ behavior by considering store awareness, image fit, and customer lifetime value. Partial least squares structural equation modeling was used to analyze data. The results indicate the following. Store image variables (except product quality) and store awareness affect repurchase intention directly or indirectly through private label image. Image fit moderates the relationships between store image variables (except product quality) and private label image. Private label image facilitates customer lifetime value. This study provides several theoretical and practical implications for hypermarket private label product developments.
The growing sales of private labels (PLs) pose significant challenges for national brands (NBs) around the world. A major question is whether consumers continue to be willing to pay a price premium for NBs over PLs. Using consumer survey data from 22,623 respondents from 23 countries in Asia, Europe, and the Americas across, on average, 63 consumer packaged goods categories per country, this article studies how marketing and manufacturing factors affect the price premium a consumer is willing to pay for an NB over a PL. These effects are mediated by consumer perceptions of the quality of NBs in relation to PLs. Although the results do not bode well for NBs in the sense that willingness to pay decreases as PLs mature, the authors offer several managerial recommendations to counter this trend. In countries in which PLs are more mature, the route to success is to go back to manufacturing basics. In PL development countries, there is a stronger role for marketing to enhance the willingness to pay for NBs.
Purpose
The purpose of this paper is to assess the relative importance of country-of-origin (COO) and its dimensions – country of design (COD), country of technology (COT), and country of manufacture (COM) – in comparison to store image in terms of consumer product evaluation and purchase intention of store brands. The authors also explore consumer regulatory focus effects.
Design/methodology/approach
Empirical data were collected from 270 young Korean adults. Two scenarios were given using two high-involvement store brands, an electronic product and clothing product that have hedonic and utilitarian elements. Data analysis was conducted using AMOS structural equation modeling software.
Findings
COO affects product evaluation and purchase intention and store image affects purchase intention. By product, store image influences product evaluation and purchase intention (electronics). COO directly influences purchase intention (clothing). By COO dimensions, overall COD weakly affects product evaluation. COT affects electronic product evaluation but directly affects clothing purchase intention. Promotion-focused consumers use COO for product evaluation, with store image directly affecting purchase intention. Promotion-focused consumers consider COD, an affective dimension, and COM in product evaluations. Prevention-focused consumers did not consider COO, but consider store image for product evaluation. Prevention-focused consumers consider utilitarian COT and COM dimensions during product evaluation.
Originality/value
This is the first paper to consider the simultaneous effect of COO (and its dimensions) and store image on product evaluation and purchase intention. It is also the first to consider the regulatory focus theory with regards to COO and store image evaluative and purchase intention criteria.
Purpose
– Private label brands of food products are an important component of many consumers’ purchases, as well as an integral element of the retail industry. The purpose of this paper is to examine the moderating role of trust on food private label brands’ purchase intention and loyalty.
Design/methodology/approach
– For this purpose, the authors propose and empirically test a conceptual model comprising variables such as price, familiarity and store image. A sample of 445 respondents was gathered, and the hypotheses were tested performing structural equation modelling.
Findings
– The findings highlight the moderating influence of trust on consumers’ loyalty to food private label brands. In addition, the results obtained reveal the substantially great influence of private label brand familiarity on purchase intention and loyalty. So, it seems that consumer trust and loyalty are strongly associated regarding food private label brands.
Research limitations/implications
– The authors suggest that trust of food private label brands allows retailers to increase consumer loyalty.
Practical implications
– Consequently retail managers should consider the enhancement of trust in the context of a marketing strategy formulation for food private label brands.
Originality/value
– The present study provides insights into the moderating effect of trust on loyalty to food private label brands, as well as evidence of the strong influence of familiarity on private label brands’ proneness, related to food products.
Purpose
The purpose of this research is to highlight the role store brands can play in retail branding. Does an image transfer take place between store brands and the retailer brand? To address this issue, the authors propose to identify and test the dimensions of image transfer from the store brand to the retailer brand.
Design/methodology/approach
A qualitative study of 138 consumers helped to complete the attributes of store brand image and retailer brand image identified in the literature. A total of 322 customers of three major French retailers responded to a questionnaire. The data collected were tested in a structural equation model.
Findings
Results indicate that store brands have a positive impact on the retailer image. The price image of the store brand is positively related to the retailer price image. The values that customers associated with store brands improve the retailer brand image in terms of its values.
Research limitations/implications
Store brands are considered as a whole, without distinction between product categories. The paper focuses on standard store brands only, excluding “premium” store brands.
Practical implications
Retailers can find a rationale for investing in their store brand range in order to differentiate themselves from their competitors. Managers should ensure that their store brands' image is seen as congruent with their own retailer brand image. In particular, more attention should be paid to the values reflected by the store brands and the store brands' price image.
Originality/value
The results indicate that store brands not only benefit from the strength of the retailer brand, but they also contribute, in a reciprocal way, to the improvement of the retailer image.
This study explores the relationships between selected marketing mix elements and the creation of brand equity. The authors
propose a conceptual framework in which marketing elements are related to the dimensions of brand equity, that is, perceived
quality, brand loyalty, and brand associations combined with brand awareness. These dimensions are then related to brand equity.
The empirical tests using a structural equation model support the research hypotheses. The results show that frequent price
promotions, such as price deals, are related to low brand equity, whereas high advertising spending, high price, good store
image, and high distribution intensity are related to high brand equity.
Assesses the evolution of retail brands within British grocery retailing over the past 25 years. Highlights key issues in defining retail brands which contribute to our understanding of their role and impact upon company strategy, and then explores how British retailers have managed the evolution of these product ranges. Identifies key factors as the changing basis and use of retail power in the distribution channel, the centralisation of management activities, and the appreciation of what constitutes retail image. Argues that British grocery retailers have successfully managed these factors to create a retail brand which is now regarded by customers as being at least equal to, if not better than, the established manufacturer brands.
Purpose
The purpose of this paper is to examine empirically the brand impact of consumer knowledge regarding a common supplier and shared product specifications between manufacturer and private label brands.
Design/methodology/approach
The study uses three fast‐moving consumer goods in an experimental setting.
Findings
The study finds that knowledge about common sourcing and shared specification decreases perceptual gaps between private labels and manufacturer brands and improves attitudes towards the retailer.
Research limitations/implications
The study uses a student sample, although all product categories and brands tested are popular with this demographic, and they are a key target market for the tested industries.
Practical implications
Manufacturer brands that supply private labels need to make sure that this information does not reach consumers and/or ensure their own brand version remains superior to the private label. Retailers that use well‐known manufacturer brands as suppliers of their high‐quality private labels might wish to share this information with customers as a means of improving attitudes towards the private label and retailer brands.
Originality/value
This paper builds on earlier platform sharing research and shows the dangers and opportunities of sharing product specification across brands with differing reputations and prices.
Research on linking operational marketing inputs to customer attitudes and customer behavior has been gaining significance concomitant with the growing recognition that customers are market-based assets. In response to this, researchers and practitioners have proposed several conceptual models. Despite recent advances in research, the results are still inconclusive as to the relationship between customer attitude and future sales. A reason for this could be due to the paucity of studies combining survey-based data with behavioral data to understand better the drivers of customer behavior. With that in mind, the authors investigate the effects of customer perceptions of key marketing actions on customer attitudes and actual customer behavior as reflected by future sales. The authors propose that customer perceptions of value, brand, and relationship—“customer equity drivers”—affect loyalty intentions and future sales. The results of the study, which is based on a sample of 5694 customers of a large European do-it-yourself retailer, suggest that customer equity drivers can significantly predict future sales, even after the authors control for the current sales level.
This article tests how well the information economics view of brand equity explains consumer brand choice in countries that represent different cultural dimensions. In this empirical analysis, the authors use survey and experimental data on orange juice and personal computers collected from respondents in Brazil, Germany, India, Japan, Spain, Turkey, and the United States. The results provide strong empirical evidence across countries for the role of brands as signals of product positions. In addition, the positive effect of brand credibility on choice is greater for consumers who rate high on either collectivism or uncertainty avoidance. Credible brands provide more value to collectivist consumers because such consumers perceive these brands as being of higher quality (i.e., reinforcing group identity). Credible brands provide more value to high-uncertainty-avoidance consumers because such brands have lower perceived risk and information costs.
This paper addresses how different store formats moderate the relationship between store image and purchase intention, mediated by brand awareness and perceived value. Questionnaire data was collected through face-to-face interviews with retail customers on the streets of a city in southern Brazil. Hypotheses testing were performed using the partial least squares structural equation modeling, supported by Smart-PLS and the Boot-strapping procedure run in the Process software. The model's sample included 298 retail customers for each store format (supermarket and mini-market). Results showed that store image positively impacted customer purchase intentions and the mediators, perceived value and brand awareness, which had a distinct effect on the direct relation of store image and purchase intention. Store format presented moderation effects on the relation between store image and brand awareness for both store formats: the higher the perception of store image, the greater the consumer's brand awareness. However, store format did not present a moderating effect on the relationship between brand awareness and purchase intention. Store image was found to be an important independent construct that improves brand awareness and increases perceived value. The number of mini-markets in Brazil is increasing, indicating that they are supplying a need unmet by supermarkets. The study design's implementation in the city streets, respondents were requested to imagine store image, which may have affected some of the parameters. The model integrated store image as an important construct influencing purchase behavior and this study presented a mediated-moderated model with managerial implications.
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Purpose
The purpose of this paper is to find the influence of retailer equity and perceived risk on attitudes toward private label brand (PLB) grocery products.
Design/methodology/approach
Retailer equity includes four variables: retailer awareness, retailer association, retailer perceived quality and retailer loyalty. The perceived risk factors include functional risk, financial risk and social risk. The attitude toward PLBs was taken as the dependent variable. The study was carried out by using a standardized questionnaire for all three constructs. The convenience sampling method was adopted to carry out data collection from customers of organized retail stores in the city of Coimbatore, in the state of Tamil Nadu, India. The relationship between the three variables was studied with structural equation modeling using IBM SPSS Amos software.
Findings
The study revealed that excluding the Financial Risk and the Social Risk, functional risk alone has significant influence over the PLB Attitude. The Retailer Equity variables, retailer perceived quality and retailer loyalty have positive influence on the PLB Attitude, while the other two variables do not show any influence. Retailer Awareness shows a negative influence over the social risk. Retailer Association does not show any influence on any of the three risk factors. Retailer perceived quality shows negative influence over the functional risk while retailer loyalty negatively influences social risk.
Research limitations/implications
The research study was carried out in cities that are populous in the Indian state of Tamil Nadu. All the respondents came from three cities in Tamil Nadu, namely, Coimbatore, Tiruppur and Madurai. Hence, extending the findings of the study to other countries where organized retail penetration is deeper may be attempted with caution.
Practical implications
The study will offer managers in the retail industry some understanding of the risk-relieving factors in operation when buying grocery goods.
Originality/value
The research paper contributes to the literature concerning the role played by retailer equity and perceived risk factors on attitudes toward PLBs.
Purpose
The evolution of private labels (PL) is a recent trend in the retail industry: many retailers now manage a PL portfolio that includes multiple value propositions, as well as various brand name strategies. Little research has been done, however, on how this combination of PL strategies conditions the results of the retailer that manages them. This study aims to examine the formation of PL brand equity and its effect on store loyalty for retailers with differently tiered PL programs (a “better” program with standard PL vs a full PL quality spectrum with economy, standard and premium PLs) and different PL naming strategies (store-banner name or stand-alone brand name).
Design/methodology/approach
A survey ( N = 644) was used to test the model in the context of the consumer goods retail industry. Exploratory factor analysis, confirmatory factor analysis and multi-group structural equation modelling techniques were used to assess the proposed model.
Findings
The results show differences in the formation of PL loyalty based on whether the retailer has a tiered PL program. In portfolios with economy, standard and premium PLs, PL associations have a stronger effect than PL awareness in the formation of PL loyalty. Portfolios with a standard PL show balanced effects of PL associations and PL awareness on PL loyalty formation. As to the positive effect of PL brand equity on store loyalty, this study also shows a stronger effect of PL brand equity on store loyalty in chains that choose to use their store banner name in their PLs.
Practical implications
Retailers that manage multi-tier PL portfolios (as opposed to those that commercialise a standard PL) can increase loyalty to the PL portfolio significantly by constructing highly differentiated images of their economy, standard and premium PLs to ensure that consumers truly perceive the different value propositions of their PL tiers. As to PL naming strategy, the authors recommend that retailers that use the same retail chain name for one or several of their PLs invest in their corporate reputation to strengthen the brand equity achieved by their PLs and thus increase loyalty to the retail chain. Retailers must perform specific communication and advertising campaigns for PLs with the stand-alone brand name.
Originality/value
Today, any reference to PLs as a whole is overly simplistic, but no research has assessed empirically differences in the influences of a multi-tiered vs a standard PL program on the PL loyalty formation for PL portfolios. Nor has any empirical research incorporated the influence of PL naming strategy on store loyalty. This study fills these gaps, integrating into the same model two significant moderating variables of retailers’ strategy: their PL tier strategy and their PL naming strategy.
Purpose
The purpose of this study is to examine the effects of identifying suppliers on private label (PL) packaging on the perceived quality, brand image, loyalty intention and relative price of the national brands (NB) produced by dual manufacturers, considering the possible moderating effects of the images of both the NB and PL.
Design/methodology/approach
The study uses an experimental setting with two different categories of grocery products.
Findings
The empirical evidence reveals different effects of PL supplier identification, according to brand images.
Research limitations/implications
This paper contributes to brand extension literature on the effects on evaluations of the parent brand. It also contributes insights about the identity and identification of PL manufacturers.
Practical implications
This supplier identification does not affect or positively affect to the perceived quality, brand image or loyalty toward NBs with lower images, but it negatively affects those with high images, especially when the PL also has a high image and adopts a stronger price positioning. Moreover, NBs with lower images appear more expensive or do not affect when they supply PLs for retailers with high images and stronger price positioning. However, if lower image NB supply a PL with the lower image, the effects do not affect or is perceived as cheaper.
Originality/value
This paper extends prior knowledge about the decision to function as a dual manufacturer from the manufacturer’s perspective.
In this article, the authors examine the circumstances in which brand names convey information about unobservable quality. They argue that a brand name can convey unobservable quality credibly when false claims will result in intolerable economic losses. These losses can occur for two reasons: (1) losses of reputation or sunk investments and (2) losses of future profits that occur whether or not the brand has a reputation. The authors test this assertion in the context of the emerging practice of brand alliances. Results from several studies are supportive of the premise and suggest that, when evaluating a product that has an important unobservable attribute, consumers’ quality perceptions are enhanced when a brand is allied with a second brand that is perceived to be vulnerable to consumer sanctions. The authors discuss the theoretical and substantive implications for the area of brand management.
The authors examine the growing and pervasive phenomenon of brand alliances as they affect consumers’ brand attitudes. The results of the main study (n = 350) and two replication studies (n = 150, n = 210) together demonstrate that (1) consumer attitudes toward the brand alliance influence subsequent impressions of each partner's brand (i.e., “spillover” effects), (2) brand familiarity moderates the strength of relations between constructs in a manner consistent with information integration and attitude accessibility theories, and (3) each partner brand is not necessarily affected equally by its participation in a particular alliance. These results represent a first, necessary step in understanding why and how a brand could be affected by “the company it keeps” in its brand alliance relationships.
The author presents a conceptual model of brand equity from the perspective of the individual consumer. Customer-based brand equity is defined as the differential effect of brand knowledge on consumer response to the marketing of the brand. A brand is said to have positive (negative) customer-based brand equity when consumers react more (less) favorably to an element of the marketing mix for the brand than they do to the same marketing mix element when it is attributed to a fictitiously named or unnamed version of the product or service. Brand knowledge is conceptualized according to an associative network memory model in terms of two components, brand awareness and brand image (i.e., a set of brand associations). Customer-based brand equity occurs when the consumer is familiar with the brand and holds some favorable, strong, and unique brand associations in memory. Issues in building, measuring, and managing customer-based brand equity are discussed, as well as areas for future research.
The trend of introducing organic private label (OPL) products aim to attract health-conscious, environmentally concerned consumers and create store loyalty. Within this context, this present study sheds insights on how store image (SI), perceived quality (PQ), trust in OPL, and perceived value (PV) influence consumers’ purchase intentions (PI) towards OPL food products. Empirical data were collected from consumers with self-administered questionnaires in Istanbul, Turkey. The suggested hypotheses were tested utilizing structural equation modeling. The findings of this research reported that SI has a positive impact on PQ and trust in OPL. It was also revealed that PQ, trust in OPL contributes to perceived value. In addition, both PV, trust in OPL and PV was found to have a positive influence on consumers’ PI. Moreover, the empirical findings also supported that the impact of PQ and trust in OPL on PI is partially mediated by PV. Some implications are also presented at the end of the study.
Private label brands are often seen as inferior to national brands across different dimensions such as quality, reliability, and prestige. They are seen as riskier choice in comparison to national brands. The contract manufacturing practice, however, may help to close the gap. Contract manufacturing practice is performed by national brand manufacturers, who use their expertise and excess capacity to produce products for private label brands. While this practice has been kept in the shadow, exposure of this information has been highlighted recently. Through a series of study, we aim to examine how exposure to such information would change consumers’ perception and behavioral intention toward the private label brand and national brand. We also aim to see if product type moderates the effect. Three experimental studies confirmed that being exposed to such information makes consumers attach higher perceived quality, lower perceived risk, and higher purchase intention toward private label brand, only when the product is a high risk product. At the same time, however, consumers express less favorable attitudes toward the national brand; but stay reluctant to switch to a private label brand, especially in the case of high risk products.
Purpose
This study aims to examine the effect of private label brand (PLB) products’ negative publicity (NP) events on PLB general image and retailer’s store image, because of the suggested interdependency between retailer’s store image and PLB image.
Design/methodology/approach
Three empirical studies were conducted to test the NP effect – Studies 1 and 2, respectively; and test the occurrence of moderate and extreme NP events regarding the functional PLB product category. Study 3 replicates prior studies conducted on the hedonic product category. In these studies, participants were randomly assigned to treatment and control groups. The studies use factor analysis methods following t -tests and paths analyses, using structural equation modeling (SEM).
Findings
Findings show that both moderate and extreme NP have an influence on the PLB’s image dimensions. These effects “spilled over” to the entire range of PLB products, regardless of the category of the damaged product. Regarding retailer’s store image, the effect of NP was retained in the product-related image context and did not exceed that of the store-related image. However, in relation to functional products, when NP is very extreme, the effect on PLB image exceeds that of retailer’s store image.
Practical implications
Retailers should invest more efforts in their PLB product selection, quality maintenance and supervision to eliminate potential damage from events related to their PLB products.
Originality/value
The originality of this study is in the association of two streams of research: NP effects and the relationship between PLB image and retailer’s store image.
We build a game-theoretic model of price competition between a national brand manufacturer and a retailer that also sells its private label. In particular, we examine a national brand's strategy of building brand premium in the context of channel coordination. The importance of national brand's brand equity has been well-documented in many empirical and behavioral studies. We reinforce the argument that building brand premium should be the first line of defense for a national brand instead of aggressively cutting wholesale price. Not only does the national brand manufacturer benefit from it, but also the retailer who sells both the national brand and its own private label has less incentive to promote the latter. Therefore, it can induce retailer cooperation, which is essential for a successful strategy in a distribution channel.
The Consumer-Based Brand Equity (CBBE) literature has, in recent years, introduced various CBBE models. This study aims to compare the validity of the two prominent CBBE models in the retail industry; those introduced by Yoo and Donthu (2011) and Nam, Ekinci and Whyatt (2011). In order to make this comparison, the study collected data from Turkish (n = 285) and Spanish respondents (n = 236) who had experience with global fashion brands and Private Labels (PL). The findings of the study suggest that Nam et al.'s (2011) CBBE model has better validity than Yoon and Donthu's (2011) model. When brand awareness is included in Nam et al.'s model, the psychometric properties of the model improve and outperform the two models. The study discusses the theoretical contributions and managerial implications of the research.
Worldwide premium private labels (PPLs) are a new and rapidly growing phenomenon. However to date, little is known about consumers' perceptions of these newer entrants relative to other brand types. Therefore it is difficult for marketers to understand the opportunities and threats created by this new generation of brands. This study examines the ways in which consumers categorise PPLs compared to more traditional value private labels (VPLs) and national brands (NBs) on the three dimensions of quality, value for money and trust. The data includes seven packaged goods categories in three countries, the United States, the United Kingdom, and Australia. The findings show that PPLs sit on a separate island, in between VPLs and NBs in consumer memory. While consumers generally view PPLs as a separate subgroup of brands, PPL are connected to other subgroups in that they are perceived to have the value characteristics of VPLs but quality characteristics of NBs. Finally, consumers with past experience with VPLs have a stronger ability to categorise PLs into distinct brand tiers.
Multitier store brands are increasing in significance in retail outlets. In this article, the authors theoretically examine the rationale for the existence of multitier store brands, their optimal quality levels, and their implications for consumer welfare and channel profits. They show that despite the manufacturer’s efforts to deter the entry of store brands by providing side payments and/or introducing additional national brands, the retailer will offer multitier store brands in equilibrium. Furthermore, the quality levels of store brands and national brands are interlaced, with a store brand taking the top-quality position unless national brands outnumber store brands. Even though the proliferation of store brands reduces product differentiation, it does not decrease consumer welfare or channel profits. However, store brands hurt the manufacturer’s profits and make two-part tariffs ineffective in improving channel coordination. Nonetheless, the retailer can enhance channel coordination by proc...
Purpose
– The purpose of this study is to develop and test a conceptual model of the moderating effect of customers’ value consciousness (CVC) on the relationship of store image (SI) with four dimensions of the perceived risk associated to the purchase of a store brand over a manufacturers’ brand, and the direct effect of those variables on the perceived unfairness of manufacturers’ brand prices.
Design/methodology/approach
– A mall-intercept survey of 600 shoppers in Colombia (South America) gathered data on their consumption experiences of a store brand and manufacturer’s brand across six product categories and two supermarket chains.
Findings
– Results suggest that SI exerts different influences on the four categories of perceived risk, the strength of which varies with value-consciousness. Perceptions of the price unfairness of manufacturers’ brands are attenuated by the financial and functional risk of buying store brands but increased by the social and psychological risk.
Research limitations/implications
– The findings may not be generally applicable to other shopping contexts or customers. The functional perspective on SI may mean that the results are not directly comparable with other studies adopting different perspectives.
Practical implications
– For retailers, the key implications concern awareness and management of customers’ perceptions of relative risks and the impact of value-consciousness on the use of SI as a heuristic decision-making cue. For manufacturers, they are the need to demonstrate clear product differentiation as a rationale for higher prices.
Originality/value
– This is the first study to encompass value-consciousness, SI, perceived risk and perceptions of price unfairness in a single field survey.
A key benefit of private labels for retailers is their potential to increase customers' store loyalty. However, previous research has not examined how this relationship varies across customers and situations. This study contributes to knowledge in this area by developing a conceptual framework that guides the investigation of the role of four moderating factors in strengthening the private label brand share-store loyalty link: (1) customers' price-oriented behavior, (2) degree of commoditization of the product category, (3) product category involvement, and (4) the retailer's price positioning. This article draws on a large-scale empirical study using a household panel and questionnaire data for 35 diverse fast-moving consumer goods product categories. The results of this study show that the relationship between private label share and store loyalty is more complex than previous research has suggested. Specifically, the private label brand share-store loyalty link is stronger for customers with high price-oriented behavior, retailers with a low price positioning, and product categories that are less commoditized and have relatively higher involvement.
This paper explores the impact of exposing the name of the manufacturer on a retail brand product upon national brand loyalty, retail brand loyalty and store loyalty, It does so by exploring customer attitudes towards retail brands in South Korea, where there is a legal requirement for retail brands to portray the manufacturer׳s name. For international retailers entering markets where such disclosure is a legal requirement an understanding of the implications of this for retail brand management is essential. The findings suggest that in the Korean case revealing the name of the manufacturer who supplies the retail brand on the product packaging has a positive influence on attitudes towards retail brands, although it did not mitigate the perceived risks held by customers towards retail brand products in general.
Purpose
– The purpose of this study is to explore the effect of store image and perceived price on the consumer’s perception of private label brands (PLBs) that have grown in stature in recent decades and are increasingly viewed as a strategic asset of retailers. In particular, the tenets of perceived quality, loyalty and awareness/associations, are argued to underpin the construct of brand prestige, which is used as a vehicle to assess consumers’ affinity toward the brand.
Design/methodology/approach
– A consumer survey was conducted with a specific focus on purchasers of private label branded breakfast cereal in Cape Town, South Africa. The data from 205 respondents were scrutinized through partial least squares path modeling, which empirically tested the eight hypotheses embedded within the conceptual model.
Findings
– The results suggest that perceived price is a powerful influencer in this process; however, the role of store image was seen to be less obvious. At a granular level, a relationship between store image and perceived quality was found to exist, but not so for loyalty and awareness/associations. In this respect, store image was seen as subordinate to the perceived price of the merchandise, bringing into question the assumed stature of store image as a key decision influencer in an emerging market context.
Research limitations/implications
– This study was confined to a single product category, within a particular retail segment, as the study focused on PLB breakfast cereal products sold within mainstream South African supermarket stores. This was desirable so as not to infuse varying merchandise category profiles into the model. Furthermore, as data were collected exclusively in the city of Cape Town, the results cannot necessarily be extrapolated to South Africa as a nation. Finally, it should be noted that the study was conducted in an emerging market setting. Developed markets, where consumers are considerably more au fait with PLBs and have increased purchasing power, may therefore produce a different set of results. Thus, our findings are not necessarily generalizable to all branches of the retail sector, nor are they necessarily applicable throughout, and across, different countries. It is hoped that subsequent studies will probe these areas and provide comparative viewpoints.
Practical implications
– This study upholds the view that price is a key driver in building PLBs, but interrogates the popular belief that store image automatically adds value in fostering goodwill toward the brand.
Originality/value
– This study is one of the first to investigate the notion of private label prestige (grounded in that of brand equity theory) in an emerging market context. In doing so, the study postulates that the “halo effect” of store image on the comprehensive evaluation of the brand might not be as prominent as maintained in existing literature. The study, therefore, questions the role of store image and perceived price of the merchandise, finding that – in actual fact – these do not fare equally in consumers’ cognitive assessment of the private label merchandise.
When consumers decide where to shop, they take several criteria into account. It is not yet clear whether private label (PL) quality is one of these criteria. It is the intention of this study to shed light on this issue because many retailers have invested heavily into the quality of their PLs. They assume that PLs differentiate a store's assortment and image, which should attract customers to the store. This study examines this assumption by use of a simultaneous equation model that links PL-specific quality evaluations to perceptions of the image of the associated store as well as to the category-specific share of store visits. Empirical results for 10 product categories show that PL quality positively affects store image perception, and influences consumers in the decision of where to shop.
Discount stores have a private-label dominated assortment where national brands have only limited shelf access. These limited spots are in high demand by national-brand manufacturers. We examine whether private-label production by leading national-brand manufacturers for two important discounters (one hard and one soft) creates discounter goodwill. We estimate a selection model that is based on a sample of 450 manufacturer-category combinations from two leading discounters (Aldi in Germany and Mercadona in Spain), and we show that private-label production is indeed rewarded: national-brand manufacturers that are involved in such practices have a higher likelihood of procuring shelf presence for their brands. Moreover, while powerful manufacturers are intrinsically more likely to obtain shelf presence with soft discounters, manufacturers with less power can compensate for this by producing private labels. No such dependence on power exists for hard discounters.
However, not all national-brand manufacturers are equally likely to produce private labels for discounters. We find that national-brand manufacturers are less likely to do so when: (a) they experience more sales growth, (b) it is more difficult to produce high-quality products in a specific category, (c) they invest more advertising support into their brands, and (d) they introduce more innovations. Moreover, a higher price differential relative to the discounter's private labels makes national-brand manufacturers less likely to engage in private-label production for hard discounters.
We study the effects of consumer perceptions of four types of corporate social responsibility (CSR) activities on their behavioral loyalty toward retailers. The four activities are environmental friendliness, community support, selling locally produced products, and treating employees fairly. Behavioral loyalty is measured by share-of-wallet (SOW). We control for other retailer attributes that drive attitudes and SOW, and examine how the market is segmented in terms of consumer response. We partition the total effect of CSR on SOW into a direct effect and an indirect effect mediated through attitude towards the store. These effects differ by CSR activity and customer segment. The effects on attitude are positive and positive attitude enhances SOW, so the indirect effects on SOW are positive. While we generally find positive total effects, the total effect of one of the CSR activities, environmental friendliness, is significantly negative for one group of consumers. The magnitude of CSR's total impact on SOW is not only statistically significant but also managerially meaningful in an industry where every share point carries a substantial dollar amount. We characterize the customer segments and conclude with implications for how best a retailer can manage its CSR initiatives.
How can flagships and brand stores contribute to building brands? We inquire about the relationships between store image, brand experience, brand attitude, brand attachment and brand equity using store intercepts. We find that flagships, due to the powerful brand experiences they allow, have a stronger impact on brand attitude, brand attachment and brand equity compared to brand stores. We provide retail marketers with avenues to offer increased in-store brand experiences by appealing to consumers’ emotions, senses, behaviors, and cognition.
Recent empirical evidence regarding the relationship between store brand purchase and store loyalty suggests a nonmonotonic relationship (inverted U): positive up to a certain store brand consumption level, after which it becomes negative. To investigate this idea further, this research analyzes the role of (1) the retailer's competitive positioning, and specifically its price positioning, and (2) the product category. On the one hand, the more price oriented the retailer's positioning, the more favorable is the relationship between store brand consumption and store loyalty. The threshold level of store brand purchasing at which the relationship becomes negative occurs later, and this negative relationship is less prominent. On the other hand, the relationship between store brand consumption and store loyalty appears to differ across product categories as a consequence of several factors, including perceived risk. The relationship therefore appears more favorable for risky categories. An empirical study of ten retailers that adopt different price positions corroborates these propositions.
This article develops an information economics perspective on the value (or equity) ascribed to brands by consumers. Unlike research based on cognitive psychology, the proposed signaling perspective explicitly considers the imperfect and asymmetrical information structure of the market. It motivates the role of credibility (determined endogenously by the dynamic interactions between firms and consumers) as the primary determinant of consumer-based brand equity. Thus, when consumers are uncertain about product attributes, firms may use brands to inform consumers about product positions and to ensure that their product claims are credible. Thus, brands may signal product positions credibly. Brands as market signals improve consumer perceptions about brand attribute levels and increase confidence in brands' claims. The reduced uncertainty lowers information costs and the risk perceived by consumers, thus increasing consumers' expected utility. This chain of relations that drives consumer-based brand equity is presented as a structural model and tested empirically in the linear structural relations framework using survey data on jeans and juice. The results are consistent with the proposed relations embodied in the signaling perspective on brand equity.
We model a supply chain consisting of a national brand manufacturer and an independent manufacturer, both of whom are potential suppliers of store brand to a single retailer. The retailer serves two customer segments—a quality sensitive segment (high type) and a price sensitive (low type) segment. The retailer serves these two segments by targeting the national and store brands to the quality and price sensitive segments, respectively. When the national brand manufacturer supplies the store brand he internalizes the effect of store brand quality on the national brand's retail prices. This leads the national brand manufacturer to choose a lower store brand quality than the independent manufacturer. This decrease in store brand quality has the benefit of increased revenues from the high type customers along with an associated cost of decreased revenues from the low type customers. Thus, when the benefit outweighs the cost the retailer chooses the national brand manufacturer to supply the store brand. We show that the retailer will choose the national brand manufacturer to supply the store brand when (a) the size of the high type customer segment is large relative to the low type customer segment, (b) the valuations of the high type customer segment is large relative to the low type customer segment, and (c) the retailer's margin requirement on the store brand is not very high. Overall, these results suggest that retailers who serve a bigger sized quality (price) sensitive clientele would have the national brand (independent) manufacturer supply the store brand.
In this article, the authors study the role of a store brand in building store loyalty through a game theoretic analysis. In a market in which a segment of consumers is sensitive to product quality and consumers' brand choice in low-involvement packaged goods categories is characterized by inertia, the authors show that quality store brands can be an instrument for retailers to generate store differentiation, store loyalty, and store profitability, even when the store brand does not have a margin advantage over the national brand. In addition, this loyalty argument does not apply for the "cheap and nasty" private label strategy. Such a private label policy, on the contrary, reinforces rather than reduces price competition among stores. Indeed, the quality of the store brand must be above a threshold level to create this opportunity. It also follows that quality store brands, when carried by competing retailers, can be an implicit coordination mechanism that enables all the retailers to become more profitable. Finally, a quality store brand policy is profitable only if a significant portion of shoppers buys the national brand. This surprising result establishes the complementary roles of store brands and national brands. The former create store differentiation and loyalty, whereas the latter enable the retailer to raise prices and increase store profitability. The authors provide empirical support for their thesis by using evidence from Europe and house-hold-level scanner panel data from the United States and Canada.
The authors develop and test a model of the key determinants of margins that retailers earn on national brands and store brands. They particularly focus on the impact of store-brand share on percentage margin, dollar margin per unit, and total dollar margin of the retailer. The authors find not only that percentage retail margins on store brands are higher than on national brands but also that high store-brand share enables retailers to earn higher percentage margins on national brands. However, the dollar margin per unit may be smaller for store brands because of their lower retail price. Furthermore, heavy store-brand users contribute much less to the total dollar profit of the retailer than do light store-brand users. The authors conclude that it is important for retailers to retain a balance between store brands and national brands to attract and retain the most profitable customers.
Co-branding is an increasingly popular technique marketers use in attempting to transfer the positive associations of the partner (constituent) brands to a newly formed co-brand (composite brand). This research examines the effects of co-branding on the brand equity of both the co-branded product and the constituent brands that comprise it, both before and after product trial. It appears that co-branding is a win/win strategy for both co-branding partners regardless of whether the original brands are perceived by consumers as having high or low brand equity. Although low equity brands may benefit most from co-branding, high equity brands are not denigrated even when paired with a low equity partner. Further, positive product trial seems to enhance consumers’ evaluations of co-branded products, particularly those with a low equity constituent brand. Co-branding strategies may be effective in exploiting a product performance advantage or in introducing a new product with an unfamiliar brand name.
Current research on brand alliances has focused primarily on alliances between two known, national brands. However, there is significant benefit to both parties in an alliance between a national brand and a private brand. Such alliances are gaining importance in the industry but have not been studied by marketers. The basic question explored in this study is whether using a national brand ingredient can benefit a private brand without hurting the national brand. First, a theoretical framework to explain how consumers may react to such an alliance is presented. Next, an experiment was conducted which showed that a private brand with a name brand ingredient was evaluated more positively. However, the evaluation of the national brand was not diminished by this association. Implications and future research directions are discussed.
Proposes a model of the store image formation process and presents results of a study of how environmental cues were used in forming store images by 120 undergraduates. Findings show that Ss utilized different cues in developing different image factors. Ss considered brand name information as the most important cue in forming quality of merchandise impressions; the number of salespersons in each department was the most salient cue in evaluating the quality of service. (PsycINFO Database Record (c) 2012 APA, all rights reserved)
This research examines brand alliances, a specific marketing strategy designed to transfer the positive brand equity of two or more partner brands to the newly created joint brand. The study explores how customer-based brand equity (that is, brand equity as seen from the customer's perspective) of partner brands affects consumer evaluations of an alliance brand; how the brand equity of one partner brand affects the other; how customer-based brand equity of the partner brands affects consumers' evaluations of the search, experience, and credence attribute performance of the alliance brand; and how product trial influences such evaluations. Results suggest that merely the act of pairing with another brand elevates consumers' evaluations of the partner brands' customer-based brand equity, and high-equity partners enhance pretrial evaluation of experience and credence attributes that are relevant to the high-equity partner. As hypothesized, product trial moderates the equity value of the alliance partner for experience attributes, and brand equity of the partner brands influences consumer perceptions of the alliance brand's equity. © 2004 Wiley Periodicals, Inc.
New food label disclosures are frequently proposed. One such proposal, the identification of manufacturer or packer of private label food items, has potentially far-reaching effects upon food choice decision making and ultimately upon the cost and availability of private label food products. This experimental study examined consumer perceptions of private brand grocery product attributes before and after manufacturer disclosure. Attribute evaluation scores from the experiment were compared against each other and against a control group. Subjects appeared to be influenced by the information, but the effects varied by product and by attribute. The overall impact of mandatory manufacturer disclosure should be carefully weighed against the consumer's right to know. Much more needs to be known about consumer use of this information before implementing this requirement.
It is often assumed that retailers' and brands' images are affected by numerous factors. One factor affecting a retailer's image is the image of the brands being sold in the store. Brand image may also be affected by the image possessed by the selling retailer. By using Heider's formula for determining congruent relationships, an analysis of the reciprocal relationships existing between various retailers' and brands' images was conducted. Although retailers' images were affected by the brands' images and the brands' images were affected by the retailers' images, congruity often did not exist.