Tržište (Jun 2013)
Application of product life cycle concept to private label management
Abstract
Private labels have recorded significant growth rates worldwide, becoming a serious threat to manufacturer brands. Development of private labels in many different product categories increased the complexity of their management. Therefore, this paper examines the possibility of using the product life cycle concept in private label management. Given that private labels are a specific brand type, it is necessary to adjust certain elements of the product life cycle concept, as it was developed on the basis of manufacturer brands. For instance, in the growth stage of the product life cycle, retailers expand private labels to a number of product categories and use the push strategy while manufacturers tend to expand their distribution network in the expansion of their brands and predominantly use the pull strategy in doing so. Furthermore, there is a focus shift from low-price strategy, predominantly used in the introduction phase, to increasing the quality and private label value in the later stages of the product life cycle.
