The determinants of purchasing private label products

Abstract

A private label is developed by a retailer with the aim to achieve the largest possible market share, to suppress manufacturer's brands, to increase the margin and to gain consumer loyalty. The subject of this paper is to analyze the determinants of purchasing private label products. The aim of this paper is to examine whether the economic situation perception, price sensitivity, quality perception and the sense of "smart shopping" have an impact on the purchase of a private label products. Data were collected by personal interview method, via online survey 260 respondents were examined, and hypotheses were tested by regression analysis. The obtained results indicate that the price sensitivity and the smart shopping feeling have a positive statistical impact on the private label purchase, while in the case of the two remaining observed variables: perception of economic situation and quality, this impact is not statistically significant. The study is original while it identifies which determinants shape consumer behavior when it comes to buying a private label. As such, it can be useful for retailers to successfully develop and manage their own branded products.

Keywords

• private label
• manufacturer's brand
• price sensitivity
• product quality
• smart shopping