IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v66y2013i1p60-66.html
   My bibliography  Save this article

Analyzing the intensity of private label competition across retailers

Author

Listed:
  • Dawes, John
  • Nenycz-Thiel, Magda

Abstract

Examining how buyers of one private label (PL) in a product category also cross-purchase the private labels of competing retailers in the same category is the focus of this study. Understanding consumer cross-purchasing of PLs is important to retailers, who use PLs as one tactic to differentiate from other retailers; and important to manufacturers, who compete against PLs. A higher level of PL cross-purchasing indicates heightened competitive intensity among the PLs of rival retailers. Results across 27 categories indicate that PLs compete against national brands (NBs) within-store, but also compete against the PLs of other retailers across stores. Heightened competition among the PLs of different retailers occurs in categories with higher purchase frequency; in which the average PL price is well below the average NB price; and in categories with higher levels of manufacturer brand price promotions.

Suggested Citation

  • Dawes, John & Nenycz-Thiel, Magda, 2013. "Analyzing the intensity of private label competition across retailers," Journal of Business Research, Elsevier, vol. 66(1), pages 60-66.
    • Handle: RePEc:eee:jbrese:v:66:y:2013:i:1:p:60-66
    DOI: 10.1016/j.jbusres.2011.07.023
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296311002591
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2011.07.023?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Fiona Scott Morton & Florian Zettelmeyer, 2004. "The Strategic Positioning of Store Brands in Retailer--Manufacturer Negotiations," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 24(2), pages 161-194, March.
    2. Uncles, Mark D. & Ehrenberg, Andrew S. C. & Goodhardt, Gerald J., 2004. "Reply to commentary on "Understanding brand performance measures: using Dirichlet benchmarks"," Journal of Business Research, Elsevier, vol. 57(12), pages 1329-1330, December.
    3. Serdar Sayman & Stephen J. Hoch & Jagmohan S. Raju, 2002. "Positioning of Store Brands," Marketing Science, INFORMS, vol. 21(4), pages 378-397, June.
    4. Robert L. Steiner, 2004. "The Nature and Benefits of National Brand/Private Label Competition," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 24(2), pages 105-127, March.
    5. Uncles, Mark D. & Kwok, Simon, 2009. "Patterns of store patronage in urban China," Journal of Business Research, Elsevier, vol. 62(1), pages 68-81, January.
    6. Nies, Salome & Natter, Martin, 2010. "Are private label users attractive targets for retailer coupons?," International Journal of Research in Marketing, Elsevier, vol. 27(3), pages 281-291.
    7. Bruce G. S. Hardie & Eric J. Johnson & Peter S. Fader, 1993. "Modeling Loss Aversion and Reference Dependence Effects on Brand Choice," Marketing Science, INFORMS, vol. 12(4), pages 378-394.
    8. Koen Pauwels & Shuba Srinivasan, 2004. "Who Benefits from Store Brand Entry?," Marketing Science, INFORMS, vol. 23(3), pages 364-390, July.
    9. Ronald Cotterill & William Putsis, 2000. "Market Share and Price Setting Behavior for Private Labels and National Brands," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 17(1), pages 17-39, August.
    10. Sanjay K. Dhar & Stephen J. Hoch, 1997. "Why Store Brand Penetration Varies by Retailer," Marketing Science, INFORMS, vol. 16(3), pages 208-227.
    11. Narasimhan, Chakravarthi & Wilcox, Ronald T, 1998. "Private Labels and the Channel Relationship: A Cross-Category Analysis," The Journal of Business, University of Chicago Press, vol. 71(4), pages 573-600, October.
    12. Parker, Philip & Kim, Namwoon, 1997. "National brands versus private labels: An empirical study of competition, advertising and collusion," European Management Journal, Elsevier, vol. 15(3), pages 220-235, June.
    13. Robert C. Blattberg & Kenneth J. Wisniewski, 1989. "Price-Induced Patterns of Competition," Marketing Science, INFORMS, vol. 8(4), pages 291-309.
    14. Anil Kaul & Dick R. Wittink, 1995. "Empirical Generalizations About the Impact of Advertising on Price Sensitivity and Price," Marketing Science, INFORMS, vol. 14(3_supplem), pages 151-160.
    15. Karsten Hansen & Vishal Singh, 2008. "Research Note--Are Store-Brand Buyers Store Loyal? An Empirical Investigation," Management Science, INFORMS, vol. 54(10), pages 1828-1834, October.
    16. Karsten Hansen & Vishal Singh & Pradeep Chintagunta, 2006. "Understanding Store-Brand Purchase Behavior Across Categories," Marketing Science, INFORMS, vol. 25(1), pages 75-90, 01-02.
    17. Jagmohan S. Raju & Raj Sethuraman & Sanjay K. Dhar, 1995. "The Introduction and Performance of Store Brands," Management Science, INFORMS, vol. 41(6), pages 957-978, June.
    18. Ehrenberg, Andrew S. C. & Uncles, Mark D. & Goodhardt, Gerald J., 2004. "Understanding brand performance measures: using Dirichlet benchmarks," Journal of Business Research, Elsevier, vol. 57(12), pages 1307-1325, December.
    19. Manohar U. Kalwani & Donald G. Morrison, 1977. "A Parsimonious Description of the Hendry System," Management Science, INFORMS, vol. 23(5), pages 467-477, January.
    20. Jack (Xinlei) Chen & Om Narasimhan & George John & Tirtha Dhar, 2010. "An Empirical Investigation of Private Label Supply by National Label Producers," Marketing Science, INFORMS, vol. 29(4), pages 738-755, 07-08.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sharp, Byron & Dawes, John & Victory, Kirsten, 2024. "The market-based assets theory of brand competition," Journal of Retailing and Consumer Services, Elsevier, vol. 76(C).
    2. Chan Choi, S., 2017. "Defensive strategy against a private label: Building brand premium for retailer cooperation," Journal of Retailing and Consumer Services, Elsevier, vol. 34(C), pages 335-339.
    3. Graham, Charles & Khan, Kamran & Ilyas, Muhammad, 2019. "Estimating the value of passing trade from pedestrian density," Journal of Retailing and Consumer Services, Elsevier, vol. 46(C), pages 103-111.
    4. Marques, Catarina & da Silva, Rui Vinhas & Davcik, Nebojsa S. & Faria, Rita Tamagnini, 2020. "The role of brand equity in a new rebranding strategy of a private label brand," Journal of Business Research, Elsevier, vol. 117(C), pages 497-507.
    5. İpek, İlayda & Aşkın, Nilay & İlter, Burcu, 2016. "Private label usage and store loyalty: The moderating impact of shopping value," Journal of Retailing and Consumer Services, Elsevier, vol. 31(C), pages 72-79.
    6. Miquel-Romero, Maria José & Caplliure-Giner, Eva María & Adame-Sánchez, Consolación, 2014. "Relationship marketing management: Its importance in private label extension," Journal of Business Research, Elsevier, vol. 67(5), pages 667-672.
    7. Fornari, Edoardo & Fornari, Daniele & Grandi, Sebastiano & Menegatti, Mario, 2013. "The influence of retailing-mix levers on private label market share: The case of the Italian FMCG market," Journal of Retailing and Consumer Services, Elsevier, vol. 20(6), pages 617-624.
    8. Nenycz-Thiel, Magda & Romaniuk, Jenni, 2016. "Understanding premium private labels: A consumer categorisation approach," Journal of Retailing and Consumer Services, Elsevier, vol. 29(C), pages 22-30.
    9. Zachary Nolan, 2019. "Optimal Assortment on an Integrated Platform," Working Papers 19-06, NET Institute.
    10. Garczarek-Bąk Urszula, 2018. "Explicit and Implicit Factors That Determine Private Labels’ Possible Purchase: Eyetracking and EEG Research," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 54(1), pages 36-49, March.
    11. Chen, Xuan & Liu, Yizao & Rabinowitz, Adam N., 2017. "Private Labels Competition, Retail Pricing and Bargaining Power: The Case of Fluid Milk Market," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252823, Southern Agricultural Economics Association.
    12. Cuneo, Andres & Milberg, Sandra J. & Alarcon-del-Amo, Maria del Carmen & Lopez-Belbeze, Pilar, 2019. "Private label and manufacturer brand choice in a new competitive reality: Strategic directions and the future of brands," European Management Journal, Elsevier, vol. 37(1), pages 117-128.
    13. Bhat Ishfaq Hussain & Singh Sapna, 2018. "Examining the moderating effect of shopping value on private-label and loyalty in Indian grocery stores," Management & Marketing, Sciendo, vol. 13(1), pages 748-760, March.
    14. Khalil Assala & Suela Bylykbashi & Gilles Roehrich, 2021. "How To Measure Competitive Intensity?," Post-Print hal-03381232, HAL.
    15. Wu, Lifang & Yang, Wei & Wu, Jessica, 2021. "Private label management: A literature review," Journal of Business Research, Elsevier, vol. 125(C), pages 368-384.
    16. Xuan, Chen & Rabinowitz, Adam & Liu, Yizao, 2016. "Private Labels Competition and Retailers Market Power: The Case of Fluid Milk Market in Connecticut," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 235678, Agricultural and Applied Economics Association.
    17. Stefan Hirsch & Giulia Tiboldo & Rigoberto A. Lopez, 2018. "A tale of two Italian cities: brand-level milk demand and price competition," Applied Economics, Taylor & Francis Journals, vol. 50(49), pages 5239-5252, October.
    18. Kwieciński Dariusz, 2017. "Measures of Competitive Intensity – Analysis Based on Literature Review," Journal of Management and Business Administration. Central Europe, Sciendo, vol. 25(1), pages 53-77, March.
    19. Hökelekli, Gizem & Lamey, Lien & Verboven, Frank, 2017. "The battle of traditional retailers versus discounters: The role of PL tiers," Journal of Retailing and Consumer Services, Elsevier, vol. 39(C), pages 11-22.
    20. Dawes, John, 2014. "Cigarette brand loyalty and purchase patterns: An examination using US consumer panel data," Journal of Business Research, Elsevier, vol. 67(9), pages 1933-1943.
    21. Hanna Górska-Warsewicz & Sylwia Żakowska-Biemans & Maksymilian Czeczotko & Monika Świątkowska & Dagmara Stangierska & Ewa Świstak & Agnieszka Bobola & Julita Szlachciuk & Karol Krajewski, 2018. "Organic Private Labels as Sources of Competitive Advantage—The Case of International Retailers Operating on the Polish Market," Sustainability, MDPI, vol. 10(7), pages 1-28, July.
    22. Coelho do Vale, Rita & Verga Matos, Pedro & Caiado, Jorge, 2016. "The impact of private labels on consumer store loyalty: An integrative perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 28(C), pages 179-188.
    23. Pangarkar, Aniruddha & Shukla, Paurav & Taylor, Charles R. “Ray”, 2021. "Minimalism in consumption: A typology and brand engagement strategies," Journal of Business Research, Elsevier, vol. 127(C), pages 167-178.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Weimin Ma & Rong Cheng & Hua Ke, 2018. "Impacts of Power Structure on Supply Chain with a Store Brand," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 35(04), pages 1-25, August.
    2. Raj Sethuraman, 2009. "Assessing the External Validity of Analytical Results from National Brand and Store Brand Competition Models," Marketing Science, INFORMS, vol. 28(4), pages 759-781, 07-08.
    3. Sherif Nasser & Danko Turcic & Chakravarthi Narasimhan, 2013. "National Brand's Response to Store Brands: Throw In the Towel or Fight Back?," Marketing Science, INFORMS, vol. 32(4), pages 591-608, July.
    4. Rong Luo, 2018. "Store brands and retail grocery competition," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(4), pages 653-668, October.
    5. Amrouche, Nawel & Zaccour, Georges, 2007. "Shelf-space allocation of national and private brands," European Journal of Operational Research, Elsevier, vol. 180(2), pages 648-663, July.
    6. Cui, Qinquan & Chiu, Chun-Hung & Dai, Xin & Li, Zhongfei, 2016. "Store brand introduction in a two-echelon logistics system with a risk-averse retailer," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 90(C), pages 69-89.
    7. Sergio Meza & K. Sudhir, 2010. "Do private labels increase retailer bargaining power?," Quantitative Marketing and Economics (QME), Springer, vol. 8(3), pages 333-363, September.
    8. Szymanowski, M.G., 2009. "Consumption-based learning about brand quality : Essays on how private labels share and borrow reputation," Other publications TiSEM b12825d8-5e21-4437-adda-b, Tilburg University, School of Economics and Management.
    9. Xue Li & Xiaoqiang Cai & Jian Chen, 2022. "Quality and Private Label Encroachment Strategy," Production and Operations Management, Production and Operations Management Society, vol. 31(1), pages 374-390, January.
    10. Venturini, Luciano, 2006. "Vertical competition between manufacturers and retailers and upstream incentives to innovate and differentiate," 98th Seminar, June 29-July 2, 2006, Chania, Crete, Greece 10050, European Association of Agricultural Economists.
    11. Csilla Horváth & Dennis Fok, 2013. "Moderating Factors of Immediate, Gross, and Net Cross-Brand Effects of Price Promotions," Marketing Science, INFORMS, vol. 32(1), pages 127-152, July.
    12. Sethuraman, Raj & Gielens, Katrijn, 2014. "Determinants of Store Brand Share," Journal of Retailing, Elsevier, vol. 90(2), pages 141-153.
    13. Draganska, Michaela & Klapper, Daniel, 2006. "Retail Environment and Manufacturer Competitive Intensity," Research Papers 1953, Stanford University, Graduate School of Business.
    14. Ting Zhang & Xiaowei Zhu & Qinglong Gou, 2017. "Demand Forecasting and Pricing Decision with the Entry of Store Brand under Various Information Sharing Scenarios," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 34(02), pages 1-26, April.
    15. Cheng, Rong & Duan, Yongrui & Zhang, Jianguang & Ke, Hua, 2021. "Impacts of store-brand introduction on a multiple-echelon supply chain," European Journal of Operational Research, Elsevier, vol. 292(2), pages 652-662.
    16. Hans Sebastian Heese, 2010. "Competing with channel partners: Supply chain conflict when retailers introduce store brands," Naval Research Logistics (NRL), John Wiley & Sons, vol. 57(5), pages 441-459, August.
    17. Yingjue Zhou & Tieming Liu & Gangshu Cai, 2019. "Impact of In-Store Promotion and Spillover Effect on Private Label Introduction," Service Science, INFORMS, vol. 11(2), pages 96-112, June.
    18. Hökelekli, Gizem & Lamey, Lien & Verboven, Frank, 2017. "The battle of traditional retailers versus discounters: The role of PL tiers," Journal of Retailing and Consumer Services, Elsevier, vol. 39(C), pages 11-22.
    19. Jin, Yannan & Wu, Xiaole & Hu, Qiying, 2017. "Interaction between channel strategy and store brand decisions," European Journal of Operational Research, Elsevier, vol. 256(3), pages 911-923.
    20. González-Benito, Óscar & Martos-Partal, Mercedes, 2012. "Role of Retailer Positioning and Product Category on the Relationship Between Store Brand Consumption and Store Loyalty," Journal of Retailing, Elsevier, vol. 88(2), pages 236-249.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:66:y:2013:i:1:p:60-66. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.