The Role of Price/Quality Tiers on the Cluster Effect in Brand Choice

Abstract

With the increasing availability of store private label brands along with established national brands, academic researchers and marketing managers are interested in studying the nature of competition between brands belonging to different price/quality tiers. This paper tries to extend our knowledge of price/quality tier competition by studying the moderating role of price/quality tiers on the cluster effect. Cluster effect postulates that the number of people choosing a brand from a cluster increases with the size of the cluster.