Influence of Department Store Image on Private Label Brand Preference Among Consumers With Different Level of Knowledge and Familiarity

Abstract

This study examined the influence of department store environmental cues and consumers’ level of knowledge about and familiarity with PLBs on their PLB preferences. With the rising competition in recent retail markets, retailers found that increasing the variety of products with private label brand (PLB) is one of the ways to satisfy consumers’ various needs and wants, and thus build customer loyalty and create differentiation from the competition. Moreover, as the PLBs lead to increased profits for retailers compared to national brands, they began stocking their shelves and aisles with exclusive, high quality private labels to satisfy their customers and enlarge their clientele (Provigo, Inc. 2007). According to the Private Label Manufacturers Association (2009), one in every five products sold in U.S. supermarkets, drug stores, and mass merchandisers in 2008 were private label brands. Private Label Manufacturers Association also states that 60 percent of consumers report buying private label brands on a regular basis, which brought retailers $80 billion in 2008, up 22 percent from 2007.