Country-of-origin and private-label merchandise

Abstract

This research examines the impact of country-of-origin (COO) perceptions on store brands and store ownership. Online grocery shoppers were subjected to a series of manipulations involving: (a) product type – national brand or store brand; (b) product source – including local or foreign, and culturally close or culturally distant; and (c) store ownership. We find that store brands benefit from being locally sourced, and benefit further if the store is also locally owned, in terms of risk, quality, and value perceptions. If a brand is to be foreign sourced, it is preferable for it to come from a country recognised as culturally close to the seller country. Being the first study to look at the impact of COO effects on store brands, our paper offers insights about how management should take advantage of local sourcing and ownership, or put in place marketing efforts to counter negative COO effects.     

Consumer Preferences for Coffee: Hot and Wet,or Quality and Flavor?

An econometric model is developed and estimated for all brands of coffee sold at the retail level in four supermarkets in Columbus, Ohio. These brands are segmented into 24 categories, and the four stores are classified into two groups, inner-city and suburban, based on 2010 census tract data. Using estimated measures of price-sensitivity, these 24 categories are further segmented into four groups to help guide and clarify the discussion. Estimated results show different purchasing patterns and different levels of price-sensitivity for inner-city and suburban shoppers. Further, these purchasing patterns and levels of price-sensitivity suggest alternative marketing strategies for retailers. Private-label coffee brands are shown to be quite competitive with many national brands, and indeed private-label brands command a market share among inner-city shoppers that is more than double that for the nation (21.95% vs. 9%).     

How category characteristics affect the number of store brands offered by the retailer: a model and empirical analysis

Our research examines why retailers offer, not one, but multiple store brands in some product categories. More specifically, we are interested in how certain product category characteristics affect the number of store brands. We model a product category consisting of two incumbent national brands that may differ in strength. The retailer may introduce one or two store brands depending on which maximizes category profits. Our analysis suggests that the retailer is likely to carry two store brands in categories where (i) the national brands are similar in strength; and (ii) the price sensitivity between the national brands is low. Interestingly, the conditions that support the introduction of more than one store brand are quite different than the conditions that would facilitate the introduction of additional national brands. We provide empirical evidence that support our model-based predictions.     

跨国公司竞争优势及其相关理论的演进探讨

基于跨国经营活支的时间顺序,探讨跨国公司竞争优势及其相关理论的演进逻辑,即其关注焦点从企业内部"特定优势"到企业外部产业结构,再到企业内部的资源和能力,其研究的出发点是从跨国公司对外直接投资必须具有什么样的竞争优势到如何获取可持续的竞争优势,并对未来进行展望。     

Generalizations regarding the growth and decline of manufacturer and store brands

Stimulating growth or staving off decline in market share are core objectives for brand managers, including retailers who now offer store brands (SBs). This study identifies how changes in brand penetration and repeat-purchase loyalty accompany changes in brand share. We examine 1093 changes in brand share over 63 packaged goods categories in the UK from 2003 to 2007, covering both growth and decline. Two measures of repeat purchase loyalty are used—annual purchase frequency (PF) and share of category requirements (SCR). Our results show that brand share growth is accompanied by greater change in penetration than in loyalty, at a ratio of approximately 3:1. This finding generalizes across brand type, loyalty measure, retailer SB or manufacturer brand (MB), category purchase frequency, category type, and initial brand share. However, while brand share growth is accompanied by stronger changes in SCR than PF for MBs; the reverse is the case for SBs. For MB decline, both penetration and SCR change are significant correlates. However for SBs, the decline in brand share happens predominantly in loyalty—more strongly in SCR, followed by PF. Therefore, both brand types need to focus on building penetration to grow. While MBs also need to prevent light buyers from lapsing, SBs need to pay more attention to retaining heavy buyers to avoid repertoire demotion.     

Manufacturer brands versus private brands: Hoch's strategic framework and the Swedish food retail sector

The purpose of this study was to contribute to the knowledge of how manufacturer brands choose and can choose to defend themselves vis-à-vis introduction of private brands by retailers. The study adopts the same research approach as a Dutch empirical study (Verhoef, P. C., E. J. Nijssen, and L. M. Sloot. 2002. “Strategic Reactions of National Brand Manufacturers Towards Private Labels – An Empirical Study in the Netherlands.” European Journal of Marketing 36 (11/12): 1309–1326) that tested and rejected large parts of the original and well-known conceptual framework by Hoch (Hoch, S. J. 1996. “How Should National Brands Think About Private Labels?” Sloan Management Review 37 (2): 89–102) consisting of six manufacturer strategies to defend against private brands. This study is based on the Swedish market, a more typical market compared with the Dutch market characterized by high innovation level and high penetration of private brands. The study builds on a combination of qualitative and quantitative interviews with brand managers at 100 manufacturers in the Swedish Fast Moving Consumer Goods (FMCG) market. The results support Hoch's original conceptual framework concerning appropriate defence strategies for manufacturer brands. However, the two differentiation strategies – value for money and new and improved – are seen as one category of the strategies, which creates a simpler and more distinct structure to the framework. The results show that it is the largest and the leading manufacturers that choose this strategy. The lower the penetration of private brands, the larger the share of manufacturers that choose this strategy. The study gives a more nuanced picture concerning the motives behind the strategies and also concerning the differences between how manufacturers act depending on size and market share.     

Profiling consumers of own brands and national brands using human personality

Traditional methods of market segmentation based on demographic variables have shown mixed results in differentiating between those who are more likely to buy own brand products and those who prefer national brands. Taking advantage of the emerging convergence in human personality research on the Big Five dimensions, we focus on the potential of human personality as a method of identifying different customer segments. Two types of own brands are considered, those labelled with the retailer's corporate name and those labelled with a name independent of the retailer. Two product categories are included, cola as an example of a low-involvement product and cosmetics as an example of a high-involvement product. The personality profiles of buyers of these and the leading national brands in each category are compared. Stepwise regression is used to identify those aspects of shopper personality that predict purchase rates of all products. Individuals who are more ‘open to experience’ report higher purchases of corporately named products, while individuals who are more ‘extrovert’ report higher purchases of national brands. Those reporting higher rates of purchase for own brands with independent names tend to be more ‘agreeable’ and ‘extrovert’. The positioning of the three types of brands against the 5 dimensions of human personality is illustrated using correspondence analysis. The clear potential to use human personality to segment and profile markets for own brands and national brands is discussed.     

The impact of introducing a customer loyalty program on category sales and profitability

The authors propose and empirically investigate the effect of category-specific attributes as important factors associated with the change in pre-versus post-loyalty program introduction category sales and profits. Category penetration and frequency are positively correlated with loyalty program success with an increase in sales and profits, whereas impulse buying and ability to stockpile show negative correlations. Furthermore, although introducing a loyalty program generates immediate spikes in sales and profits in most categories; its impact is generally short-lived. It results in an initial redistribution of category expenditures during the program launch, where consumers seemingly shift consumption from lightly purchased categories to heavily purchased categories. But the effect soon erodes. Nevertheless, by modeling the diffusion process of loyalty program performance, this paper finds that penetration rate and private label share are key drivers of a category's sustainable growth. The evolution of consumer price elasticities and promotion sensitivities are tracked pre- and post-loyalty program introduction, and profit-driving categories are identified according to their category characteristics. New insights are offered on category management and long-term program planning.     

Competition for memory retrieval between private label and national brands

Perceptions of private label brands (PLBs) reside in consumer memory along with national brands (NBs). When a consumer engages in a choice situation, both PLBs and NBs rely on links to retrieval cues in consumer memory to give them a chance of purchase. This study examines the underlying competition between NBs and PLBs across different retrieval cues. The findings show that PLBs link to the same attributes as NBs and so compete with NBs for retrieval. However, while any brand typically competes most with the brands more commonly associated with any specific cue, the study finds evidence of PLB sub-categorization. That is, if a consumer elicits one PLB for a certain cue, he/she has four times the propensity to elicit other PLBs than elicit a NB for that same cue. This heightened propensity suggests that when a consumer learns that one PLB has a particular quality, the consumer generalizes that quality to other PLBs. Therefore, retailers should realize that the image of competitor retailers' PLBs affects the image of their own PLBs.     

谦卑研究的前沿探析:基于资源观的企业竞争优势

基于谦卑的以往研究,首先梳理了"谦卑"概念的发展、内涵以及与相近概念的区分;然后基于资源观理论视角,指出谦卑是企业竞争优势的源泉,分析了谦卑作为战略性资源的特性;并进一步剖析了谦卑资源是如何通过组织学习、服务以及组织弹性发展的过程为企业创造价值;最后进行了总结和研究展望,以期为后续研究提供参考。     

Consumer attitudes and loyalty towards private brands

Private or store brands improve the efficiency of consumer decision making by offering equivalent quality products at lower prices. The present study evaluated consumer attitudes towards private brands with the goal of understanding their appeal in order to enhance efforts to convince more consumers to buy them. We used three samples (ns = 279, 245 and 305) of US consumers to compare attitudes of buyers of private and national brands in three product categories: orange juice, cereal and bottled water. The results show that private label buyers (23% of orange juice, 6.5% of cereal and 14% of bottled water buyers) consider brands themselves to be less important and private brands to offer better performance than do national brand buyers. When asked about specific brands, national brand buyers tended to be price insensitive towards national brands, and private label buyers price insensitive towards store brands. In addition, the national brand buyers saw some of the national brands to be more relevant to their lifestyles and needs, but the private label buyers saw the private labels the same way. Being relevant to consumers' lives appears to influence brand selection. Besides touting lower prices, private brand promotions might stress the equivalent performance of private labels and create promotions showing how these brands can be relevant to consumers' lifestyles and needs.     

Measuring Customer Relationship Management Performance

Abstract

The concept of CRM has evolved into an inherent component of the sales processes of most medium-sized and large companies. However, despite the high costs involved, the quality of its implementation has hitherto been neglected. To provide the conceptual qualitative CRM control that is lacking, we have developed a measuring instrument that allows the evaluation of the activities in the three core CRM domains, namely interaction, insight and offer. We pilot-tested the tool in an automotive industry setting and the results reflect the CRM status quo achieved by twelve national and foreign brands.     

Bridge,Focus, Attack,or Stimulate: Retail Category Management Strategies with a Store Brand

We investigate a monopolist retailer's category management strategy where the main strategic decisions are how to horizontally position a store brand relative to the incumbent national brands and how to price the store and national brands for retail category profit maximization. We analyze a market composed of two consumer segments with differing tastes and heterogeneity with respect to willingness to pay and a product category consisting of two competing national brands and one store brand. We find that contrary to the existing literature, it is not always optimal for a retailer to position its store brand against the leading national brand; instead there are many situations where it is best to position the store brand close to the weaker national brand or to position it in the “middle” so it appeals to both national brands' target segments. In the process we identify four distinct category management strategies that a retailer can use with a store brand. In three of these the optimal store brand price is the brand's monopoly price, while in the remaining one strategy the price is lower. We also suggest an easy to implement means for a retailer to determine which strategy is best to use, depending on the particular competitive environment present before the introduction of the store brand and the relative quality of the store brand. We find that the store brand entry is most beneficial to the retailer when the national brands are moderately differentiated. Finally we show that introducing a store brand not only allows the retailer to garner a higher share of the channel profits through higher retail margins, but also often provides the retailer the benefit of increases in national brand unit sales as well as incremental sales from the store brand. JEL Classification: M310     

Desire,need, and obligation: Examining commitment to luxury brands in emerging markets

The availability of a wide variety of luxury brands has resulted in declining commitment toward a single brand. Enhancing brand commitment has, therefore, become a significant challenge for international businesses and marketing managers. We develop a multi–dimensional brand commitment framework underpinned by marketing, organizational, and social psychology literature streams. The simultaneous examination of brand–commitment dimensions based on consumer desire, need, and obligation in our framework offers a novel perspective that advances research on brand commitment. Our findings demonstrate stability of the framework in important emerging markets for luxury brands, namely China, India, Russia, Turkey, and Thailand. The framework, incorporating affective, continuance, and normative brand commitment dimensions, offers a conceptually robust fit. We demonstrate that each brand commitment dimension is influenced by distinct antecedents, and we show the direct and interactional impact of consumers’ emotional attachment, economic motivations, and normative pressures on purchase intentions. Supported by well-established theories in organizational and social psychology, our study offers new insights on how consumers commit to brands. We provide international brand managers with a blueprint for strengthening brand commitment across countries.     

A model of consumer relationships with store brands,personnel and stores in Spain

Abstract

Relationship Marketing is an important approach to the study of exchanges. This approach puts emphasis on the development of trust, satisfaction and relational norms to obtain parties' commitment. However, there are very few studies that consider the different levels the consumer relates with. Moreover, a limited number of marketing studies include variables that are often used in economic approaches such as signalling theory, which can enrich the understanding of commercial relationships. Therefore, the proposed multidisciplinary model relates economic variables—the signals that firms send to the market—and key relational variables—satisfaction and trust—considering three relationship levels of trust and satisfaction—store brands, personnel and stores. Results show a transference process among the three levels of trust and confirm that satisfaction and signals are important antecedents of each trust level.     

Performance effects of category assortment and stock allocation decisions for a cash-and-carry wholesaler

This study develops and tests a model of how category assortment, category stock level and within-category stock allocation decisions might affect category sales and stock turnover and reflect category-varying levels of sales heterogeneity and sales volatility. In doing so, it addresses recent calls to consider multiple dimensions of assortment planning. It uses the cash-and-carry wholesaling setting to isolate non-space-related assortment planning and performance variables otherwise difficult to treat in a conventional retailing (e.g. supermarket) context. It develops a structural equation model of how category sales volatility and heterogeneity, as antecedents, might influence both category assortments and stock allocations and thus, in turn, influence category performance.     

Competitive advantage: A longitudinal analysis of the roles of data-driven innovation capabilities,marketing agility,and market turbulence

While data-driven innovation capabilities have received considerable attention from academics and practitioners, there is insufficient longitudinal evidence on how they might contribute to improved marketing agility and competitive advantage. In this study, we make a preliminary effort to address this gap by developing a model based on the dynamic capabilities view. We also explore the moderating effects of market turbulence on the link among marketing agility and competitive advantage. We used two-waves data (T = 677 and T+1 = 569) and the cross-lagged panel approach was utilised to analyse the longitudinal data. Our findings provide robust empirical evidence on the causal and predictive temporal impact of data driven innovation capabilities on marketing agility and competitive advantage. It also indicated that marketing agility mediates this relationship over time. Moreover, the analysis suggested that market turbulence reinforce the influence of marketing agility on competitive advantage. We provided significant implications for theory and practice.     

Entry for supermarket feature me-too brands: An empirical explanation of incidence and timing

Anticipating the speed of market entry can help the feature pioneer and me-too brands develop more informed product launch strategies. This paper explains imitation speed, broken down into the incidence and timing of imitation, across 144 imitators and 847 nonimitators in 22 consumer packaged goods subcategories. On average, it takes 85 weeks for a me-too brand to introduce its feature imitation. Increasing category market share increases the incidence of imitation and, conditional on their occurrence, decreases the time to market of feature imitators. Faster entry arises for store brands as they are more likely to imitate and tend to take shorter times to market. Price premium does not have a significant effect on the incidence or timing of a me-too brand as it tends to dissipate after the first year. Brands imitate innovative features more often than noninnovative features. Some evidence indicates these imitators can take a longer time to enter the market. New product managers may benefit from the direction as well as the magnitude of these results.

The Impact of Firm Capabilities and Competitive Advantages on Import Intermediary Performance

ABSTRACT

Import intermediary firms, domestic firms that serve U.S. industries by linking domestic wholesalers/retailers and foreign distributors/manufacturers, handled a whopping U.S. $1.85 trillion of commodity good imports in 2006. This study focused on these important firms by assessing the role of capabilities and competitive advantages as key determinants of import intermediary performance. The empirical results showed that market interpretation, sourcing, and service capabilities, overall, positively affected cost, product, and service competitive advantages. These competitive advantages, in turn, positively affected their relationship performance with business partners. Results, however, also indicated some interesting negative associations among sourcing capabilities, service advantages, and relationship performance with foreign partners, raising questions about extant firm performance theory.     

Motivating purchase of private brands: Effects of store image, product signatureness, and quality variation

This study examines the effects of intangible extrinsic cues on consumer quality perception and purchase intention of private brands. We find that store image and product signatureness enhance quality perception and purchase intention of private brands while quality variation reduces both outcomes. All effects of the three extrinsic cues on purchase intention are partially mediated by quality perception. In addition, consumer value consciousness strengthens the relationship between quality perception and purchase intention of private brands.