Role of Brand Trust in Private Label Adoption Model-an Affective and Trust-based Innovation Characteristic

Abstract

Consumers' lack of trust in the private label brand is thought to be the root cause of private label's failure in developing markets, particularly in Asia. To improve their market share in developing markets, retailers must address private-label brand trust issues and utilize private-label characteristics to convince non-users to adopt their products. However, brand trust, which is understood to play a significant impact in innovation adoption, is not taken into account in the Diffusion-of-Innovation literature. To fill this gap, this study aims to apply a trust-based commendation to supplement 'brand trust' as the innovation characteristic and validate an adoption model for the private label that consists of all its important innovation characteristics. Brand trust is also expected to play a determinant role in the innovation characteristic model as an affective-based innovation characteristic. As a result, this study has empirically proven brand trust (β = 0.364) to be the most influential characteristic of adoption intention compared to relative advantage (β = 0.214), compatibility (β = 0.214), and perceived risk (β = -0.167). The empirical support of brand trust as the affective mediator contributes to justifying the significance of affective-based characteristics to the adoption of innovation.