About the authors
Justin Beneke is a Senior Lecturer in the School of
Management Studies at the University of Cape Town. His
research interests include retailing management, branding,
and electronic marketing. He is currently completing his
doctorate in the field of private label brand management.
Justin Beneke is the corresponding author and can be
contacted at: Justin.Beneke@uct.ac.za
Ryan Flynn was a postgraduate student in the School of
Management Studies at the time of the study.
Tamsin Greig was a postgraduate student in the School of
Management Studies at the time of the study.
Melissa Mukaiwa was a postgraduate student in the School
of Management Studies at the time of the study.
Executive summary and implications for
managers and executives
This summary has been provided to allow managers and executives
a rapid appreciation of the content of this article. Those with a
particular interest in the topic covered may then read the article in
toto to take advantage of the more comprehensive description of the
research undertaken and its results to get the full benefits of the
material present.
Recent studies indicate that consumers are becoming more
favorable towards private label or store brands. This has
marked a significant shift in sentiment as such offerings were
previously condemned as being cheap, poor quality
alternatives to brands offered by established manufacturers.
Standards have risen to an extent that the perceived quality
gap between mainstream brands and private label brands has
narrowed considerably. Retailers that produce their own label
goods are exploiting the changing situation to increase profits
and create customer loyalty. Being able to negotiate terms
with manufacturers from a position of strength is another
notable consequence.
It has been noted by several researchers that different
factors potentially impact on whether or not consumers will
support private label brands. Customer perceived value of a
product is seen as particularly important and has been
described as an “overall mental evaluation” performed by the
consumer. Value is often measured in relation to cost of the
product or service and to suitable alternatives. Other
researchers consider the value construct as the balance
between quality and price. Perception of value is renowned for
strongly influencing consumer purchase intention.
The subjective and multidimensional nature of customer
perceived product value makes measuring the construct a
challenging task. Nevertheless, a firm must gain insight into
the different facets of perceived value in order to use
appropriate channels to communicate with consumers and
position its offerings effectively. Value dimensions are typically
regarded as relating to either quality or price, although the
relevance of perceived risk is also becoming acknowledged
more.
Opinions vary as to the role that price plays in shaping how
consumers value a product. Certain academics attach greater
substance to the perception of a product’s price in comparison
with the cost of suitable alternatives rather than to its actual
price. In this context, the perceived relative price of a private