Marketing Research

To study the Consumers approach towards

‘Private Labels’

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 Table of Contents

Topic Pg No

Executive Summary 04

Introduction 05

Research 07

Limitations 08

Findings 09

Conclusion 12

Bibliography 13

Questionnaire 14

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 ACKNOWLEDGEMENT

We would like to thank Prof: Mr. Bhattacharya for giving us this opportunity to work
on a topic which would reflect latest trend, working on such a current issues was a
good learning experience.

We also like to thank all the respondents for their valuable time, and in helping us
with their responses without which the project would not have been possible.

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 EXECUTIVE SUMMARY

In India the growth of private labels have been phenomenon and is slowly gaining
more store space. According to a FICCI-Ernst & Young 2007 report, as quoted in
The Marketing Whitebook 2009-10, the retail sector in India was worth $280 billion,
of which organized retail comprised 5% at $14 billion.

This study focuses on Consumer Beliefs, Attitude and motivation towards Private
Labels. The study gives an insight into the different attributes and parameters
considered by consumer for evaluating a in store brand.

Consumer beliefs of Private labels across various categories reflecting on

purchasing pattern were also discovered which emphasized on the key opportunity
category for private labels and also addressed the category on which private labels
needed to work upon.

To accomplish the task, a survey was carried in and around Mumbai city (retail
outlets) with a sample of 20 respondents taken on a random basis approaching the
customers who walked in retail outlets. A structured questionnaire was prepared
and administered and the data so collected was analyzed both by percentages and
statistical methods.

Though, private labels at present constitute about 5% of the organised retail

business, experts feel they can grow up to 30% once retail brands develop in the
country.

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 INTRODUCTION

Brands owned not by a manufacturer or producer but by a retailer or supplier who

gets its goods made by a contract manufacturer under its own label are called
Private Brands.

Private label certainly is the talk about town these days. Private label, after all, is no
new kid on the block. Retailer brands after all, have been hanging around national
name brands for more than a couple of decades. The question was never a matter
of if as much as when private label would evolve to seriously threaten national name
brand dominance and primary share of shelf space.

In India, the growth of store brands is a function of increasing retail sophistication.

Large-format, modern retail stores (known as the "organized" retail sector) -- as
opposed to smaller, traditional "mom and pop" stand-alone stores -- are presently
only a small portion of total retail in the country.

Private label brands constitute 10-12% of organized retail in India, Of this, the
highest penetration of private label brands is by Trent at 90%, followed by Reliance
at 80% and Pantaloons at 75% .Big retailers such as Shoppers Stop and Spencer's
have a penetration of 20% and 10% respectively.

Nearly 40-50% of the store space are dedicated to store brands,these products
share the shelf space with other branded products.For example, in the Reliance
store its curd brand Dairy Life was placed next to the other brands, such as Amul.
This is especially true for apparel, Shoppers Stop has several in-house brands.

Women's wear category itself it has STOP, Kashish, Remika etc Similarly, in the
mens wear category, it has STOP, Life, Vettorio Fratini, and so on .These products
are not differentiated from the other brands in terms of store space. These products
are priced substantially lower than the other brands.

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Consumers today acknowledge that private labels have the ability of creating
unique, resonant benefit propositions for consumers.

The question is whether private label brands have come far enough in the minds of
consumers for these brands to compete as legitimate brands in their own right.
From the consumer perspective, private labels have closed the gap with national
brands. Consumers believe private labels are “identical” to national name brands
and almost 50% see them as “close” but not yet on par with name brands.
About one in 10 consumers believe private labels are “better” or “superior” to
national brands. Only 5 percent of consumers perceive private labels to be “inferior”
to national brands.

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 RESEARCH

PROBLEM STATEMENT

The retailer desires to understand consumers approach their beliefs and attitude
towards In Store brands which can help them in better positioning and designing
marketing strategies to accelerate sales of their consumer attitudes, beliefs about
private labels what are the key aspects that motivates customers to go for Private
labels visa vis Brands.

OBJECTIVE OF THE STUDY

To understand Consumer attitudes, beliefs about private labels what are the key
aspect that motivates customers to go for Private labels visa vis Brands.

IMPORTANCE OF THE STUDY

Besides understanding Customers views on private labels and what are aspects
they consider before purchasing private labels we also came to know about the
threats or competition faced by Brands due to increasing private labels.

METHODOLOGY

1. Research Design: The chosen research design was Descriptive Cross

Sectional Study
2. Sources of Data: Primary Data
3. Data Collection Technique: Survey
4. Data Collection tool: Questionnaire (attached)

SAMPLE DESIGN

1. Sample Procedure: Convenience Sampling

2. Sample Frame: The respondents were working professionals &
housewives between the age group of 25-50 years.
3. Sample Size: The study was conducted based on sample size of 20.
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 LIMITATIONS OF THE STUDY

 The customers’ study was conducted only in Mumbai city. The results
therefore are confined to this area only and need not necessarily be applicable
to other areas.

 The sample size of the customers was small, so it was not able to convey the
attitude of the customers

 Respondents might have some biased views and this could have affected the
findings to a certain extent

 In the questionnaire, questions are very limited, because it is very difficult to

get the information from the busy officials.

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 FINDINGS

• Demographic:

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• Preference towards the brand available

• Attributes towards brand in terms of importance

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• Factors that can help induce in-house brand

• Product Category preference

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 CONCLUSIONS

Retailers in India are spurring consumers' decision-making by expanding the scope

of private labels.

"For most consumers, a private label is just another brand”, Hence, there has been
a steady growth especially in the categories where consumers have less loyalty to
better-known or promoted brands are the categories where In store brands are
picking up.

Private label brands have come far enough in the minds of consumers for these
brands to compete as legitimate brands in their own right. From the consumer
perspective, private labels have closed the gap with national brands. Consumers
believe private labels are “identical” to national name brands and almost 50% see
them as “close” but not yet on par with name brands.

Private labels matter for higher gross margins to retailers and also help in
differentiating them against other retail outlets. Hence retailers are adopting different
marketing strategies to maximize sales and are giving a direct competition to
established manufacturing brands.

It could be concluded that Private labels are here to stay, and will be dominate 50%
of the retail market.

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 BIBLIOGRAPHY

Website:

www.business.in.com
www.dare.co.in
www.ibef.org
www.knowledge.wharton.upenn.edu
www.naturalproductsinsider.com

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 Consumer’s approach towards ‘Private Labels’

1. Name

2. Gender
Male
Female

3. Age

20yrs- 25 yrs
25yrs-35yrs
35-50 yrs
Above 50yrs

4. Marital Status
Married
Single

5. Occupation

Housewife
Service
Business
Profession

6. Monthly disposable income

Below Rs 25000
Rs 25000-50000
Above Rs 50000

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 7. What do you shop, how often?
Daily Weekly Bimonthly Monthly Occassional

Vegetables

Grocery

FMCG (Toiletries,
Detergents etc.)

Garments

Electronics

8. Are you Brand conscious?

Yes No At times

9. If No, have you tried the stores in-house products?

Yes No

10. Your preference towards the brands available should be

strongly Moderately strongly

disagree agree
disagree agree agree

excellent quality

value-for-money

not risky to buy

are fresh

excellent packaging

are healthy

are prestigious

an excellent image

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 11. Rate the below attributes on the scale of 1 – 5. (5 - Very important & 1 - Not Important).

Brand Image

Prestiguous

Healthy

Packaging

Fresh

Risk-Free

Value for Money

Quality

12. Which among the below factor can help induce trial for an In House Brand.

Price Discount Add ons at the same price Promotions Others

13. In case you were to try an ‘In’ store brand which category you would prefer among the
below and Why?

Food Products Apparels Electronic appliances others

_______________________________________________________________________

14. Give any other experience or factor that makes you prefer private label products

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