Date: May 30, 2011 Program: MIMA – International Marketing Course name: Master Thesis (EFO 705) Title: Consumer behavior towards private label brands: A study of  Thai undergraduate students' experience Method: Both quantitative and qualitative methods were used. Quantitative method was used to collect the primary data for this research. Moreover, qualitative method was also used to support the results from questionnaires. Conclusion: The research attempts to examine the different factors that influence consumers' purchasing intentions of private label brands among Thai undergraduate students. Five important factors were identified; there are collectivist culture, perceived risk, price, quality and store loyalty. Collectivist culture and perceived risk were found out to be important background factors which affect the other three factors. Furthermore, the result shows that price and quality of private label brands are highly related as most of the target consumers tend to associate expensiveness with high quality and vice-versa. However, the effect of store loyalty on consumers' (Thai undergraduate students)purchasing intention was found out to be insignificant.

Bakgrund: Idag satsar distributörerna i detaljhandeln på differentiering genom att lansera egna märkesvaror till flera olika segment och till högre priser. Detta brukar kallas den fjärde generationens EMV och det är ett relativt nytt koncept i Sverige i jämförelse med andra länder. Detaljhandelskedjan Axfood är en aktör som har inlett en utökning genom lanseringen av Garant som vi anser vara en EMV av fjärde generationen. Problem: Leverantörernas varumärken har under lång tid ansetts vara ”riktiga” märken medan distributörernas egna märkesvaror endast är för priskänsliga konsumenter. Tidigare studier visar att konsumenter är villiga att betala ett högre pris för LMV pga. att de har lyckats bygga starkare varumärken. Byggandet av positiva associationer till EMV anses ha hindrats av att detaljhandlarna inte har skapat något unikt med sina varor. Ur ett brand management perspektiv, måste företagen som ämnar lansera den fjärde generationens EMV skapa en ny image som skiljer sig från de tidigare generationernas egna märkesvaror för att bli av med sin lågprisprofil, och visa att de är likvärdiga de marknadsledande produkterna. Då EMV har visat sig vara framgångsrikt på den brittiska marknaden så kan det vara en bra utgångspunkt för att identifiera framgångsfaktorer. Syfte: Syftet med denna studie är att med hjälp av företaget Tesco på den brittiska marknaden identifiera framgångsfaktorer som kan tillämpas på den svenska marknaden för den fjärde generationens egna märkesvaror. Ett underliggande syfte är att undersöka om Garant kan anses vara en fjärde generationens märkesvara och i så fall hur konceptet kan använda sig av de framgångsfaktorer identifierade på den brittiska marknaden, för att lyckas i Sverige. Resultat: Vi bekräftar att Garant är en fjärde generationens EMV. Vi har sett att för att lyckas med den fjärde generationens egna märkesvaror, behöver man bidra med ett mervärde som kunden är beredd att betala ett högre pris för och att detaljisterna mer måste utnyttja den starka position de har på den svenska marknaden för att förbättra imagen runt EMV och mer specifikt för den fjärde generationen. / Background:Today, retail distributors are investing in differentiation by launching their own brands to various segments and to higher prices. This is known as the fourth generation of own brands and is a relatively new concept in Sweden in comparison with other countries. The retail chain Axfood is an actor who has started an expansion through the launch of the brand Garant that we consider to be a private label of the fourth generation. Problem: The suppliers’ brands have long been considered as the “real brands”, while the distributors' brands are only for price-sensitive consumers. Previous studies show that consumers are willing to pay a higher price due to that the suppliers have managed to build stronger brands. The creation of positive associations with own brands is considered to have been prevented by the fact that retailers have not created something unique with their products. From a brand management perspective, companies that intend to launch the fourth generation own brands need to create a new image different from the previous generations in order to get rid of their low price profile, and show that they are equivalent to the market leaders. Since private labels have proven to be a success on the British market, it is a logical starting point to investigate. Aim: Our aim is to explore the success factors for fourth generation private labels on the British market, with the help of the company Tesco, to apply on the Swedish market. The secondary aim is to see if the Swedish private label Garant could be considered to be a private label of the fourth generation, and if so, if the success factors can be applied. Results: We have found that to succeed with the fourth generation of own brands, value that the customer is willing to pay a higher price for, must be created, and that retailers must use their powerful position on the Swedish market in order to improve the image for own brands and more specifically the fourth generation.

This research is focus on how store image affects perceived risks and purchase intention in different private label brand (PLB) products. Because of 7-Eleven¡¦s positive store image and diverse product categories, this research takes 7-Eleven as the example to explore the difference among its PLB products. The conclusions as follow¡G 1. Positive store image is a necessary condition to develop PLBs. 2. Product category is a success factor to PLBs. 3. Consumers perceive different perceived risks when facing different products. According to the conclusion, suggestions are as bellow¡G 1. Keep maintaining and improving store image. 2. Focus on the products which are highly-related to the store image. 3. Managing perceived risk as a marketing strategy in diverse PLB product categories.

Background: In the past 10 years private label has increased significantly in the Swedish grocery market. This is an important strategic event, which is a great challenge to suppliers as it causes stiff competition. To handle this situation an increasing number of suppliers have to make the decision whether to produce private label or not. Purpose: The purpose of this study is to find and analyse factors that influence suppliers in the Swedish grocery market to produce private label. On this basis we intend to confirm or develop existing theories within the field of study. Research method: The study has a qualitative approach where empirical data has been gathered through interviews with suppliers and retailers in the Swedish grocery market. Results: This study has identified factors that underlie suppliers’ decision to produce private label. The most important factor is the possibility of increased volumes and a more efficient capacity usage. Today there is a great downward pressure on price, why it is of great importance to have a cost efficient production. Many suppliers in the Swedish grocery market do not use their full production capacity and producing private label is therefore an option to increase the level of usage. Moreover, suppliers are experiencing a growing dependence on retailers. This is due to the increased power that retailers have attained through their centralised decision-making, dominating position and increased knowledge and negotiation power. This study shows that the shift in power influences suppliers’ decision to produce private label. Finally, possibilities of improved relationships between suppliers and retailers do not underlie Swedish suppliers’ decision to produce private label. / Bakgrund: Under den senast tioårsperioden har private label ökat kraftigt inom den svenska dagligvarumarknaden. Detta är en viktig strategisk händelse som utgör en stor utmaning för märkesleverantörer, då det innebär en allt hårdare konkurrens. För att möta denna ställs alltfler leverantörer inför beslutet gällande huruvida de skall tillverka private label eller inte. Syfte: Syftet med studien är att finna och analysera faktorer som ligger till grund för att leverantörer på den svenska dagligvarumarknaden tillverkar private label. Utifrån detta avses vidare att bekräfta eller utveckla befintliga teorier inom forskningsområdet. Metod: Studien har en kvalitativ ansats, där empirisk data har samlats in genom intervjuer med leverantörer och detaljister på den svenska dagligvarumarknaden. Resultat: Genom studien har faktorer identifierats som ligger till grund för att leverantörer på den svenska marknaden tillverkar private label. Den viktigaste faktorn är leverantörernas möjlighet till ökade volymer och ett mer effektivt kapacitetsutnyttjande. Då det i dagsläget råder en stark prispress på dagligvarumarknaden är det av stor vikt att ha en kostnadseffektiv verksamhet. Eftersom många leverantörer på den svenska marknaden inte utnyttjar hela sin produktionskapacitet framstår private label-tillverkning som ett alternativ till att utöka denna. Vidare upplever leverantörerna på den svenska dagligvarumarknaden ett allt större beroende till detaljist. Detta beror på den ökade makt som detaljisterna uppnått genom deras centraliserade beslutsfattande, dominerande ställning samt ökad kunskap och förhandlingsstyrka. Studien visar att denna maktförskjutning har en inverkan på leverantörers beslut att tillverka private label. Slutligen utgör inte möjligheten till relationsförbättringar mellan leverantör och detaljist ett motiv till att leverantörer på den svenska marknaden tillverkar private label.

The purpose was to investigate how the retailer ICA could transfer its brand equity when rebranding its low price private label product Euroshopper. The study also had the intention to look at the outcome of the rebranding process through examining how customers’ brand perception and their behavior was influenced by the rebranding. What made it interesting to conduct this study was that there has been a lack in research that considers rebranding and the role of brand equity in such a process. Brand equity is a very important asset for companies, since it creates value for the customers that they use as information base when making decisions. A quantitative survey was conducted and the conclusion from it is that strong brand equity can be transferred to a product that once had a negative image and that perception can be replaced by a stronger brand image.

Pagrindinis darbo tikslas yra išanalizuoti privačių ženklų keliamas grėsmes gamintojų ženklams ir atlikus tyrimą aprašyti galimus grėsmių sušvelninimo metodus. Darbas yra sudarytas iš trijų dalių: teorinė analizė, situacijos analizė ir projektinių sprendimų. Privačių prekių ženklų produktai, tai produktai, kurie parduodami tik tuose prekybos tinkluose, kuriems šie prekių ženklai priklauso. Juos kontroliuoja mažmenininkai, kurie turi išskirtines teises į šiuos prekių ženklus. Ilgą laiką privatūs ženklai buvo asocijuojami su maža kaina ir prasta kokybe, bet šiame darbe atliktas tyrimas parodė, kad privačių ženklų produkcija ir jų kokybė yra gana teigiamai vertinama . Šio reiškinio pasekmė yra nauja ir daug sudėtingesnė bei kelianti vis didesnes grėsmes gamintojų ženklams. Trečioje dalyje bus pateikti metodai , kaip būtų galima sušvelninti keliamas privačių ženklų grėsmes. / The main aim of the work is analyzing threats that private labels pose to manufacturer brands and, upon the completion of a research, describing methods of mitigating these threats. The work consists of three parts i.e. theoretical analysis, situational analysis and project solutions. Private label products are the products which are sold in stores of retail networks which own these private labels. They are controlled by retailers which have executive rights for these private labels. For a significant period of time private labels were associated with low price and low quality, but the research carried out in this work demonstrates that private label products and their quality are evaluated quite positively. The outcome of this phenomenon is new and more complex as well as posing growing threats to manufacturer brands. The third part presents methods of mitigating the threats which private labels pose.

During the past two decades something fundamental has happened to the relationship between manufacturers and distributor organisations in many European countries. Within a number of product markets, distributors have launched their own products, forcing manufacturing companies to compete with shelf space owners in addition to the "traditional" competition with other manufacturers. Theoretical and empirical findings regarding Distributor Own Brands (DOB’S) offer us a number of explanations of the differences between national markets and product categories in terms of DOB penetration. However, much of this literature is deterministic in its approach: DOB penetration is often seen as a direct consequence of different market conditions, rather than as the result of strategy processes involving a number of decision-makers and their perceptions of market-related and organisational factors.This study investigates how an array of organisational and market related factors are perceived by distributor organisations, and how this is expressed in the organisations’ own brand strategies. To investigate this research problem, a theoretical framework that explicitly takes distributor own brand strategy into consideration when examining proposed determinants of DOB penetration is presented. The empirical study is mainly based on interviews with decision-makers within the central organisations of the two largest distributors within Swedish fmcg distribution: the ICA federation and the consumer co-operation KF. / Diss. Stockholm : Handelshögsk.

The aim of the bachelor thesis was to find out the current condition of consumer as-sociations towards retailer brands and based on the results to suggest the measures that lead to the situation improvement in the increasing sales field as well as in the creation of consumer associations towards these brands. These associations were examined in relation to the Tesco brands. The first part summarizes the theoretical background in the brand management, mar-keting, marketing research, and private brands. The information was drawn from the literature and websites that deal with the topic. The second part focuses on identifying information that was needed to build the questionnaire and testing its original version which was relevant to determine the clarity of the respondents. This was followed by the final version of the questionnaire. The next part first presents a basic sample of the survey and then it evaluates the re-sults and facts based on the survey. This is followed by the measurement proposals in the form of strengthening the leaflets promoting of retailer brands and making more available the discount tokens. These measurements ought to increase the knowledge of the private brands and to remove erroneous perception of some of their categories.

As private labels have developed and increased in recent years, customers’ options have grown. The purpose of this qualitative study is to explore how customers reason when they choose a brand in a Swedish sportswear store, which offers both private labels and national brands. More specifically, the following attributes, private labels versus national brands, customer behavior, and store layout are considered in order to address a possible complexity in the brand choice. The empirical material was collected through twelve exit interviews outside Stadium stores in four cities, combined with four observations in four Stadium stores. The findings revealed that private labels and national brands seem to have similar product characteristics, which may cause complexity in customers’ brand choices. This thesis contributes with an insight into a new dynamic within the walls of a sportswear store and discusses what aspects influence customers’ brand choice.

Ces dernières années, le développement continu des marques de distributeurs (MDD) a abouti à un marché composés de trois grands segments de consommateurs : (i) ceux qui sont fidèles aux marques nationales, (ii) aux marques de distributeurs et (iii) ceux qui combinent les deux. Pourquoi ce dernier groupe de consommateurs migrent-t-il d’une marque nationale vers une marque de distributeurs et inversement ? A notre connaissance, aucune étude n’a été menée sur cet aspect de la concurrence entre marque nationale et MDD. Les travaux de recherche en marketing ont surtout étudié les changements entre marques nationales ou le choix des MDD. Or, le comportement migratoire entre les deux types de marques peut représenter jusqu’à 20% des comportements d’achat (source : Panel MarketingScan). L’objet de cette thèse est donc de proposer un cadre théorique permettant de comprendre la migration entre les deux types de marques. Nous analysons l’influence des variables relatives à la marque (ou des références) et à la catégorie de produits tout en tenant compte des différences individuelles (observées et non observées) entre les ménages et les enseignes. Nous utilisons comme cadre empirique le panel Angevin de la Société MarketingScan. Nous élaborons pour cela un modèle de choix avec coefficients aléatoires et facteurs latents (Latent Factor Random coefficients Multinomial Logit Model) permettant de contrôler l’hétérogénéité entre les ménages. Les résultats montrent que le type de MDD (marque enseigne ou marque propre) a une influence à la fois sur la migration vers et le rachat des MDD. Le prix reste toujours important dans la concurrence entre les deux types de marques. Une plus grande disponibilité des références au niveau de la marque de distributeurs permet d’attirer plus de consommateurs. Toutefois, une forte présence de MDD réduit la satisfaction des consommateurs à l’égard de l’assortiment et les pousser à migrer vers les marques nationales. / For the last years, the consistent development of store brands or private labels has resulted in a market composed of three segments: customers who are national brand loyal, (ii) store brand loyal and (iii) those who combine store and national brands. So the question becomes: why does the latter group of consumers migrate from a national brand to a store brand and vice versa? To our knowledge, no study has been conducted about this aspect of national brand and private label competition. The research in marketing has mainly studied brand switching between national brands and the choice of store brand. However, migration between the two types of brand might account for up to 20% of the purchase behaviours (source: MarketingScan panel). The purpose of this dissertation is to suggest a theoretical framework to understand the migration between the two types of brands. We analyzed the influence of variables at the brand and SKU, and product category levels, while accounting for the (observed and unobserved) individual and store specific factors. Our empirical analysis is based on the panel data from MarketingScan. We developed a Latent Factor Random Coefficients Multinomial Logistic Model that allows us to control for unobserved heterogeneity. We showed that the type of store brand had an influence on both the migration and the behavioural loyalty to store brand. The price is still important in the competition between private labels and national brands. Greater availability of SKUs at the brand level promotes migration to store brands, which helps them capture additional purchases. Nevertheless, a strong presence of private labels in a product category reduces consumer satisfaction with the assortment and consequently causes households to migrate to national brands.