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Store Brands and the Role of Advertising

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  • Griffith, Rachel
  • Smith, Kate
  • Krol, Michal

Abstract

Store brands are products over which a retailer (rather than a manufacturer) takes certain strategic decisions; we study the incentives of a retailer to advertise its store brands. We use detailed data on the British grocery market to document the considerable variation in store brand penetration across product categories and retailers. We develop a model that relates the pricing and advertising decisions of retailers and manufacturers to primitive characteristics of the category, and in particular the way that advertising affects consumer demand. We present empirical evidence that is consistent with several predictions from the model.

Suggested Citation

  • Griffith, Rachel & Smith, Kate & Krol, Michal, 2015. "Store Brands and the Role of Advertising," CEPR Discussion Papers 10877, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:10877
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    References listed on IDEAS

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    Cited by:

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    2. Friedrichsen, Jana, 2018. "Signals Sell: Product Lines when Consumers Differ Both in Taste for Quality and Image Concern," Rationality and Competition Discussion Paper Series 70, CRC TRR 190 Rationality and Competition.

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    More about this item

    Keywords

    Advertising; Store brands;

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • M37 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Advertising

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