An investigation of the new generic consumer

Ram Herstein
Business Management Department, Ruppin Academic Center, Emek Hefer, Israel, and
Sigal Tifferet
Ruppin Academic Center, Emek Hefer, Israel

Abstract
Purpose – This research is designed to characterize new generic consumers and assess their willingness to purchase generic brands in non-generic
product categories.
Design/methodology/approach – A total of 500 generic consumers participated in the study. Participants were customers of two large private chain
stores in central Israel, known for their abundance of generic products.
Findings – the paper finds that new generic consumers have a somewhat different profile than that of generic consumers of the 1980s. Furthermore,
generic consumers are prepared to purchase generic brands even in categories not defined as generic.
Research limitations/implications – The study focused on a market characterized by economic instability, which may contribute to strong readiness
to purchase generic brands even in product categories not generic by definition. Future research is needed to study the profile of the new generic
consumer from the perspective of cultural differences among countries and not within countries.
Practical implications – The willingness of generic brand marketers and retailers to enter product categories not defined as generic will open new
business avenues and a create a relative advantage for them over their competitors, while guaranteeing a larger market segment and an increased
volume of sales in the short term.
Originality/value – This research is the only one which has examined generic brand consumers’ buying power, on four types of buying behaviors
based on the degree of buyer involvement and the degree of differentiation among brands.

Keywords Generics, Brands, Consumer behaviour, Israel

Paper type Research paper

An executive summary for managers and executive
readers can be found at the end of this article.
Introduction
One of the most impressive marketing phenomena that the
business world saw in the twentieth century was the rapid rise
and fall of generic brands. The era of the meteoric rise of
generic brands began in 1976 in France, when the Carrefour
chain began selling 50 no-name brands in 38 of its stores
(Hawes, 1982). These products were marked by their simple
white packaging that emphasized the package’s contents, in
comparison to the familiar promotional labels.
Generic brand grocery products were 30 percent to 40
percent less expensive than respective manufacturers’ brands,
and about 20 percent below the retail price of respective
private brands (Hawes and Kiser, 1980). These low prices
were possible by virtue of the reduced costs of packaging and
promotion (Prendergast and Marr, 1997). Product quality of
generic brands was inferior to that of manufacturers’ brands.
In a sense, generic brands were a second private brand, an
additional level of a private brand. The concept behind
marketing generic brands was to compete against
manufacturers’ brands in the belief that some consumers
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Journal of Consumer Marketing
24/3 (2007) 133– 141
q Emerald Group Publishing Limited [ISSN 0736-3761]
[DOI 10.1108/07363760710746139]
had become skeptical about the link between quality and
manufacturers’ brands, and that these consumers would be
willing to purchase generic brands at a lower price, especially
during economically hard times.
Generic brands were first marketed in the USA in 1977 by
the Jewel supermarket chain of Chicago. This chain began
with 44 no-name brands. The demand for generic brands was
so impressive that the chain increased the number of generic
brands to 100 (Fitzell, 1998). By 1979, generic brand
marketing had penetrated most Western countries and had
reached Canada, Australia and Japan (McGoldrick, 1981). In
practice, the actions of distributors in marketing generic
brands induced many consumers to substitute their regular
private brand by a generic one. Research conducted by SAMI
(1983), shows that in 1982 generic brands attained a
significant portion of the market by encroaching on the
market share of private brands, without diminishing the
market share of national brands.
When many consumers later became dissatisfied with
generic brands because of their inferior quality, they returned
to purchasing better known products, national brands, and
gradually deserted private brands (Cunningham et al., 1982).
For a decade starting in the mid-1980s through to the mid-
1990s, generic brands became unimportant in the eyes of
many retailers. According to Harris and Strang (1985), the
fundamental reason for the mismanagement of generic brands
by retailers lies in the adoption of short-term marketing
strategies that could not compete with the established
national brands.
Nevertheless, during the mid-1990s generics reappeared in
stores. According to de Chernatony and McDonald (1998),

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Ram Herstein and Sigal Tifferet
the reason for their re-introduction may have been a response
to the aggressive marketing of discount stores.
Generic brand characteristics
Generic brands were differentiated from traditional
distributors’ brands in each and every element of the
brand’s characteristics (Bellizzi et al., 1981; Cunningham
et al., 1982):
Brand personality
Generic brands were based on the marketing concept that the
brand possesses no personality or exclusive image. As
opposed to generic brands, private brands do have a
personality resting on the image values of the retail chain
and succeed in conveying various levels of messages to the
consumer group to which they are targeted. Accordingly, a
private brand of a chain such as Marks & Spencer’s conveys
freshness, prestige and high status, while that of a chain such
as ASDA conveys inexpensiveness, simplicity and popularity.
Each of these two brands addresses a different class of
consumers interested in purchasing a private brand. On the
other hand, a generic brand would express one idea: a product
devoid of personality, whether the brand is sold in a chain
store with high or low positioning.
Product quality
A generic brand is manufactured from a production
orientation, not a marketing one. Therefore, all elements of
the brand quality are low. These products do not have
standard levels of quality control, and in the main, the
distributor does not demand supervision of the production
process or inspection of its composition. These manufacturers
have only limited production capability and do not possess the
means to build a brand that will compete with other brands in
the market. In contrast, private brands have to meet quality
control standards to obviate a situation in which a single
brand can harm or even undermine an entire product line or a
complete product mix.
Price
Of all the components of a generic brand, price is the factor
that has the most influence on potential consumers. The price
of a generic brand is about 20 percent lower than that of
private brands and about 40 percent lower than national
brand prices. These low prices accord the generic brand far
greater exposure, particularly with consumers defined as
price-conscious, who feel there is no justification for paying
20 percent more for a specific product if they can find a
similar one at an especially low price. Furthermore, the low
price clearly marked on the generic brand packaging assists in
quick brand identification among the tens of thousands of
brands in the supermarket, and ensures a high degree of
visibility on the shelf.
Packaging
The packaging of a generic brand is usually big, in what is
known as “bulk packaging”. The number of items in the pack
is likely to be particularly large, and this gives the generic
brand a low-priced look that suits large families of limited
means. Apart from their large proportions, the packaging of
generic brands is white or transparent, thus conveying
simplicity and displaying the product it contains. Contrary
to generic brands, private brands are now using packaging
similar to that used by national brands in an attempt to
appear like them and persuade consumers to try them.
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Location on the shelf
There are two contrasting approaches regarding the preferred
location of generic brands on shelves. The first approach
holds that generic brands should be located adjacent to
private brands, i.e. national brands at one end of the shelf,
generic brands at the other, and private brands in the center.
The second approach supports locating generic brands away
from the private ones, so as to position them as a separate
standard of product and avoid a situation whereby the generic
brands might be taken for alternatives to the private brand.
Today most retail chains that provide generic brands sell them
in a sales area not adjacent to private brands (in one of the
corners of the store) or separated from private brands (at the
end of every shelf a section is allocated to generic brands).
Promotion
Distributors will avoid promoting a generic brand at all costs
since its low price does not justify promotion, and the interest
shown by its typical consumers is low. On the other hand,
distributors promote their private brands at the point of sale
and in the mass media.
The generic consumer
The need to market generic brands in a unique way resulted
in studies investigating the characteristics of generic brand
consumers. Most research focusing on generic consumers was
done in the late 1970s and was aimed at identifying the
demographic aspects that characterize the consumer market
of generic brands as well as its psycho-behavioral features.
The influence of demographic factors on the generic brands
consumer
Family size, income, education and age of the generic brands
consumer were examined in a number of studies. In the past,
a link was found between family size and the tendency to
purchase generic brands (Cagley et al., 1980; Dietrich, 1978;
Granzin, 1981; McEnally, 1982; Murphy and Laczniak,
1979; Sullivan, 1979; Sundel and Nevils, 1979; Zbytniewski
and Heller, 1979). In other words, consumers with large
families were found to be more interested in generic brands in
order to save on the costs of their food products (primarily
during a recession), and because of the need to buy products
in large amounts and in large packages. A second
demographic variable that occupied researchers in this area
was the generic consumer’s income. Contrary to expectations,
average wage earners were inclined to buy generic products
and even preferred these over private brands (Dietrich, 1978;
Strang et al., 1979; Sullivan, 1979; Zbytniewski and Heller,
1979). This phenomenon seems to contradict the concept of a
generic brand, but in fact it may be explained in that during
the first years of generic brand penetration into retail chains,
distributors positioned generic brands as a second private
brand and not as an inferior brand. Nevertheless, there are
researchers who assert that low income consumers constitute
the main customers of generic brands (Faria, 1979;
Prendergast and Marr, 1997). Historically, it can be seen
that generic brands were successful in economically hard
times and faded out in economically good periods.
A third demographic variable is the education of the generic
consumer. Even here, surprisingly, it was found that educated
consumers were more interested in purchasing generic brands
(McEnally, 1982; Murphy and Laczniak, 1979; Strang et al.,
1979; Sullivan, 1979). These educated consumers were
capable of evaluating the degree of low risk in purchasing
 An investigation of the new generic consumer
Ram Herstein and Sigal Tifferet
these brands. Since the risk to this group of consumers was
minor and inconsequential, they were more willing to assume
it than less educated consumers, for whom the risk in buying
generic brands may have been more substantial. A fourth
demographic variable was consumers’ age. Early research
claimed that middle-aged consumers were the primary buyers
of generic brands (Dietrich, 1978; McEnally, 1982; Sullivan,
1979; Sundel and Nevils, 1979; Zbytniewski and Heller,
1979). Middle-aged consumers usually do not make their
purchases on the basis of name brands (national brands), and
since a large part of this consumer group lives off pensions,
they may be more price sensitive.
The influence of psycho-behavioral factors on the generic brand
consumer
In addition to demographic characteristics, psycho-behavioral
attributes of generic consumers were also studied. Generic
brand consumers are characterized as innovative, that is, they
are intrepid consumers (Anvik and Ashton, 1979; Granzin,
1981). This finding explains why generic consumers are
willing to take a risk and purchase unrecognized and unknown
brands. Generic brand consumers seek information about
products before purchasing them (Hawes and Kiser, 1980).
This information may refer to the brand’s price, special offers
or package size. Information seeking reduces the uncertainty
that arises in the purchase of generic brands. Generic
consumers regard advertising negatively (Bellizzi et al., 1981;
Hawes and Kiser, 1980). This may be since generic brand
consumers do not pursue personal and image values, and
hence attend to information related to product price and
quantity more than image-oriented information.
Potential purchasing power of generic brand consumers
Because of the growing power of discount stores offering
generic brands in a wide range of categories, product type has
drawn interest. Prendergast and Marr (1997) showed that in
highly processed products (e.g., shampoo and coffee); generic
brand quality is viewed as low while, in standard products
(e.g., rice, tissues), generic brand quality is viewed as high. In
light of this, it would seem that generic brands belong to the
category of products that require little involvement in their
purchase; in other words, products that present a low
operating, psychological, social and economic risk.
In order to examine generic brand consumers’ buying
power, this study adopted Assael’s (1987) Consumer’s
Decision Making Matrix. According to Assael there are four
types of buying behaviors based on the degree of buyer
involvement and the degree of differentiation among brands
(Table I).
The decision-making process in the case of complex buying
behavior (q1) is characterized by consumers’ high
involvement in the purchase and their perception of the
brands as different from each other. This type of decision
occurs when buying very expensive brands, whose purchase is
seen as risky. The risk in buying these brands is the result of
their complexity (electrical appliances and cars), or because
they are brands that reflect the consumer’s personal image
Table I Types of buying behavior
Significant perceived brand differences
High consumer involvement Complex buying behavior (q1)
Low consumer involvement Variety-seeking behavior (q3)
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Volume 24 · Number 3 · 2007 · 133 –141
(clothing, cosmetics, and jewelry). This product category is
characterized by its consumers actively searching for
information, in order to be able to evaluate alternative brands.
The decision-making process in a situation of dissonance-
reducing behavior (q2) is distinguished by a high level of
involvement during the purchase, but a low level of ability to
differentiate among competing brands. This type of behavior
is typical among people purchasing tiles and house accessories
as well as airline services, renting cars and more. In this type
of behavior a dissonance is created between the consumer’s
brand expectations and his/her brand perception after the
purchase, which may cause the consumer to change his/her
mind about the brand.
Decision making in a state of variety-seeking behavior (q3)
is typified by low involvement by the consumer in the
purchase of the brand, yet high ability on the part of the
consumer to distinguish among brands (products with unique
appearances). When consumers feel minimally involved, it is
unreasonable to suppose they will be motivated to search
widely for information. Moreover, even if there are noticeable
differences among the brands, most likely consumers will not
be at all anxious about these differences because of their low
involvement in the purchase.
Decision making in habitual buying behavior (q4) is
characterized by low importance the consumer gives to
buying brand and in barely distinguishing it from competing
brands (grocery products and cleaning products). When these
types of products are purchased regularly, the consumer will
behave according to buying strategies that will reduce the
effort of making a decision.
In an effort to transform Assael’s model into an applicable
model from the perspective of brand managers, de
Chernatony and McDonald (1998) presented strategic
solutions for each of the four types of buying behaviors.
The strategy proposed for q1 behavior is the use of advertising
offering detailed information about the brand and explaining
its advantages, while reinforcing its unique, distinct
positioning and emphasizing the brand’s features that are
perceived as important by consumers. Furthermore, brands in
this category require store sellers to know the product very
well and present it with great expertise while creating a direct
link with customers. Brands in the q2 category need
advertising that reduces the dissonance that is likely to be
created after their purchase. The advertising must convey a
feeling of satisfaction from the brand and emphasize reliable
service and guarantees. In addition, it is important to
distribute advertising material nearby the selling point as
part of the sales promotion strategy, in the event that the
customer is wavering between similar brands. Moreover,
salespeople must operate according to the brand reassurance
approach. In certain instances special design of the packaging,
to differentiate the brand from other ones, will aid in
reinforcing the customer’s opinion during the purchase. The
required marketing step for brands in the q3 category is to
cause the consumer to try out the brand, a step that will help
Minor perceivedbrand differences
Dissonance-reducing behavior (q2)
Habitual buying behavior (q4)
 An investigation of the new generic consumer Journal of Consumer Marketing
Ram Herstein and Sigal Tifferet Volume 24 · Number 3 · 2007 · 133 –141

develop brand loyalty. The brand marketers must make of 55 percent of the customers were female and 45 percent
massive use of sales promotion techniques (coupons, free were male. Additional demographic details are given in Table
handouts of the product, etc.), which are based on a simple II. Customers were approached after leaving the store; they
message and frequent appearance of advertisements. Brands were asked whether they purchased any bulk or no-name
in this category require simultaneous functional and symbolic products. Customers who answered positively were asked to
positioning. These products must be accessible and receive fill out a questionnaire.
high visibility on shelves. Brand packaging must maintain the
brand uniqueness and attract customers’ attention. Similar to
this category, the q4 category also demands that marketers Measures
adopt the same marketing strategies, emphasizing functional In order to characterize the generic customers, five questions
and not symbolic positioning. were used to measure age, gender, educational level, family
size and income. In order to estimate customers’ willingness
Hypotheses to purchase generic brands, the following question was asked:
The present study attempts to examine new generic “If this store would offer you the following products as bulk or
consumers in three ways. First, we will characterize them no-name products (at a cheaper price), how often would you
demographically. Second, we will test their willingness to be willing to buy them?” Customers were asked to answer the
purchase generic products in non-generic categories. Third, same question for four sets of products, with each set
we will appraise the importance of brand dimensions on representing a different behavior category. Product choice was
generic consumers. made from product lists compiled by Assael (1987). Q1 was
The importance of this research is particularly great in view represented by computers and televisions; q2 by jeans and
of the fact that the findings of the most important studies in perfume; q3 by toothbrush and laundry detergent; and q4 by
this field present a situation that matches the reality of flour and rice. Customers rated their willingness on a scale of
consumer behavior at the beginning of the 1980s. Beyond 1 (“never”) to 5 (“always”). In order to examine brand
this, researchers in the area of branding claim that generic dimension importance, customers were asked how important
brands face new opportunities as a consequence of their advertising, packaging, price and quality were for all of the
penetration into many product categories and diverse above eight products. Importance was rated on a scale of
discount stores (de Chernatony and McDonald, 1998). 1 (“never”) to 5 (“always”).
From reading the literature we can make four board
conclusions:
1 Generic brand consumers tend to be educated and middle Table II Demographic characteristics of generic customers
aged; they have large families and a low to average Number Percentage
income.
2 Generic brand consumers prefer purchasing generic Gender
brands in product categories characterized by low Male 226 45.2
consumer involvement and with few distinguishable Female 270 54.0
aspects.
3 Consumers who buy brands in product categories Age
characterized by high involvement will tend to attribute 15-25 35 7.0
strong importance to brand aspects such as quality, 26-35 108 21.6
packaging and advertising. 36-45 150 30.0
4 Consumers who buy brands in product categories 46-55 137 27.4
characterized by low involvement will tend to attribute 56-70 69 13.8
strong importance to price. Family size
Taken together, these conclusions are captured in the 1 10 2.0
following hypotheses: 2 56 11.2
H1. Customers will be willing to purchase generic products 3 58 11.6
in product categories q2 and q3 as well as q4. 4 124 24.8
H2. The importance of packaging will be highest in q2 and 5 158 31.6
q3. 6 69 13.8
H3. The importance of advertising will be high in q1, q2 71 17 3.4
and q3.
H4. The importance of a low price will be highest in q4. Income
Much below average 17 3.4
Below average 48 9.6
Average 155 31.0
Methodology Above average 203 40.6
Much above average 57 11.4
Subjects and setting
A total of 500 generic customers participated in the study. Education
Participants were customers of two large private chain stores Elementary 4 0.8
in central Israel, known for their abundance of generic High school 103 20.6
products. Only customers who reported buying generic High education 390 78.0
products or bulk products were asked to participate. A total

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Ram Herstein and Sigal Tifferet Volume 24 · Number 3 · 2007 · 133 –141

Results H3. The importance of advertisements will be high in

In order to characterize the generic consumer, we measured
basic demographic variables. As shown in Table II, generic
consumers are from both genders, most of them are in the age
range of 30-50, and live in a family of four to five people. It is
interesting to see that generic consumers have an average, or
above average income, and 78 percent of them have a higher
education.
H1. Customers will be willing to purchase generic
products in q2 and q3 as well as q4
As hypothesized, willingness to purchase generic brands was
not limited to q4, and was demonstrated in q2 and q3 as well
(see Table III). A two-way ANOVA showed a significant
interaction between consumer involvement and perceived
differences (Fð1,499Þ ¼ 45:22; p , 0:001). The willingness to
purchase generic brands in q1 was significantly lower than in
q2 (Fð1,499Þ ¼ 151:83; p , 0:001), q3 (Fð1,499Þ ¼ 135:82;
p , 0:001), and q4 (Fð1,499Þ ¼ 146:17; p , 0:001).
H2. The importance of packaging will be highest in q2
and q3
As hypothesized, the importance of packaging was highest in
q2 and q3 (see Table IV). A two-way ANOVA showed a
significant interaction between consumer involvement and
perceived differences (Fð1,499Þ ¼ 86:31; p , 0:001). The
importance of packaging in q1 was significantly lower than
that in q2 (Fð1,499Þ ¼ 5:97; p , 0:05) and in q3
(Fð1,499Þ ¼ 96:60; p , 0:001). There was no difference in
the importance of packaging between q1 and q4
(Fð1,499Þ ¼ 0:27; p . 0:05). Although both q2 and q3
showed high packaging importance, in q2 (high involvement
with minor perceived differences) packaging importance was
at its highest.
q1, q2 and q3
As hypothesized, advertisement influenced purchasing in all
quartiles aside from q4 (see Table V). A two-way ANOVA
showed a significant interaction between consumer
involvement and perceived differences (Fð1,499Þ ¼ 63:45;
p , 0:001). The influence of advertisement in q4 was
significantly lower than in q1 (Fð1,499Þ ¼ 113:86;
p , 0:001) that in q2 (Fð1; 499Þ ¼ 93:10; p , 0:001) and in
q3 (Fð1; 499Þ ¼ 154:30; p , 0:001).
H4. The importance of a low price will be highest in q4
Contrary to H4 it was not found that low price was of the
highest importance in q1 (see Table VI). There was no
difference in the importance of a low price between high and
low involvement categories (Fð1,499Þ ¼ 0:52; p , 0:05) or
between minor and significant perceived differences
(Fð1,499Þ ¼ 0:57; p , 0:05).
Discussion
This research had three main objectives. The first objective
was to categorize the new generic consumer and see if the
demographic profile created in the 1980s is still relevant
today. Akin to earlier studies that dealt with issues of family
size and generic brand consumers (Cagley et al., 1980;
Dietrich, 1978; Granzin, 1981; McEnally, 1982; Murphy and
Laczniak, 1979; Sundel and Nevils, 1979; Zbytniewski and
Heller, 1979), the present study found that consumers with
large families tended to buy generic products. This action
makes sense, since these consumers need larger packages. In
addition, these consumers have greater expenses, hence it is
logical that they will try to reduce them by buying generic
products.

Table III Willingness to purchase generic brands by consumer Table V Advertisement effect by consumer involvement and perceived
involvement and perceived brand differences brand differences
Significant Significant
perceived brand Minor perceived perceived brand Minor perceived
differences brand differences differences brand differences
Average Std Average Std Average Std Average Std
High consumer (q1) (q2) High consumer (q1) (q2)
involvement 2.00 1.12 2.57 1.05 involvement 2.28 1.07 2.24 1.03
Low consumer (q3) (q4) Low consumer (q3) (q4)
involvement 2.65 1.07 2.74 1.24 involvement 2.29 0.97 1.83 0.92

Table IV Importance of packaging by consumer involvement and Table VI Price importance by consumer involvement and perceived
perceived brand differences brand differences. Average (std)
Significant Significant
perceived brand Minor perceived perceived brand Minor perceived
differences brand differences differences brand differences
Average Std Average Std Average Std Average Std
High consumer (q1) (q2) High consumer (q1) (q2)
involvement 2.07 1.26 2.49 1.19 involvement 3.63 1.12 3.65 1.06
Low consumer (q3) (q4) Low consumer (q3) (q4)
involvement 2.19 1.16 2.10 1.22 involvement 3.70 1.08 3.63 1.25

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Ram Herstein and Sigal Tifferet
Previous studies found conflicting results regarding the
income of generic consumers. Some studies found that their
income was low (Faria, 1979; Prendergast and Marr, 1997),
while others found their income to be average (Dietrich,
1978; Strang et al., 1979; Sullivan, 1979; Zbytniewski and
Heller, 1979). This research supports the latter finding, and
shows that the generic consumer is characterized by an
average income and even by an above-average income. These
results can be attributed to the difficult economic situation
that forces many consumers to plan their purchases more
carefully than in the past and consequently, generic brands
become more acceptable.
Similar to earlier research that examined the level of
education of generic brand consumers (McEnally, 1982;
Murphy and Laczniak, 1979; Strang et al., 1979; Sullivan,
1979), this study also showed quite clearly that the generic
consumer has a higher education. This finding appears to
contradict the idea of generic branding strategy that espouses
marketing cheap brands with basic functional features. A
logical explanation for the present finding may be related to
the fact that the educated consumers can mentally separate a
high involvement purchase and a low involvement purchase.
Since food products are by definition a low involvement
purchase, then for educated consumers the risk involved in
buying them is not high at all and in the opinion of these
consumers, it is acceptable to buy these products, with no
psychological or social risks.
In contrast to previous research that studied the age of
generic consumers (Dietrich, 1978; McEnally, 1982; Sullivan,
1979; Sundel and Nevils, 1979; Zbytniewski and Heller,
1979), and pointed to senior citizen consumers being the
primary customers of generic brands, this study found that
consumers aged 26-55 constitute the age group of the new
generic brand consumers. This finding may be linked to the
country’s difficult economic situation. It may be that price
sensitivity, which characterizes senior citizens living on
pensions, has spread to include a broader range of ages.
The second objective of this research was to assess the
degree of sales potential of generic brands in product
categories defined as high involvement and with little
differentiation among brands (q2), as well as in product
categories denoted as low involvement and with essential
differences among brands (q3), in addition to product
categories defined as low involvement and with low
differentiation (q4). The research findings indicate that the
degree of willingness by consumers to purchase generic
brands in all three categories is high.
Despite the economic, psychological and functional risk
that exists in product categories defined as high involvement
and with low differentiation (q2), it would appear that the
sales potential of generic brands in this product category is
high. The reason for the potential lies in the fact that these
brands are perceived as similar and consumers find it difficult
to differentiate among the brands. When this situation occurs,
consumers will be inclined to choose the cheapest brand
among competing products, as long as it meets their needs.
The category of products designated as low involvement
with essential differences among brands (q3) is considered to
have the highest sales potential among generic brands. This is
due to the low risk involved in buying these brands and the
essential differences among them. Since the consumer’s
involvement is low, and he is interested in the functional
aspects of the product, and not the psychological and social
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Volume 24 · Number 3 · 2007 · 133 –141
aspects, he will tend to buy the cheaper brand whose external
appearance is the most striking from among the set.
Similar to the SAMI (1983) studies, which showed that
generic brands have penetration rates greater than 10 percent,
especially in three product groups: preservatives, spices,
baking products, paper products, plastics and aluminum, this
research also found that the product categories defined as low
involvement and low differentiation (q4) were considered to
have the highest sales potential among generic brands. This is
a function of the character of these categories, which are
primarily directed at consumers who are indifferent about
buying and have little interest in national brands.
Consequently, these consumers are inclined to select the
cheapest brand from among those offered for sale in these
categories. These will be brands, which in their opinion, meet
their minimum requirements and match their functional
needs.
The third objective of this research was to examine the
degree of importance of the four main aspects of brand image
when relating to generic brands in four different product
categories. Similar to de Chernatony and McDonald’s (1998)
approach to the significance of packaging in Assael’s (1987)
model, this research also found that packaging constitutes a
very important image aspect in product categories defined as
requiring high involvement with low differentiation among
brands (q2) and in product categories defined as requiring
low involvement with essential differences among brands
(q3). The reason for the importance of packaging in both
these product categories is different for each case. Packaging
is important when generic brand consumers are buying an
item from product categories defined as high involvement
with low differentiation among brands (q2) because of the
need to bolster the consumer’s opinion during the purchase,
as he/she may still be unsure. In addition, it give him/her the
feeling that he/she has bought a unique brand in light of the
fact that for him/she all the brands are very much the same
and he/she is highly involved in this purchase. The packing in
this case has an especially strong ability to create a
perceptional difference among brands that appear to the
consumer to similar to each other. In contrast, the importance
of packaging in product categories defined as low involvement
with essential differences among brands (q3) is even greater
and stems from the fact that the consumer is somewhat
indifferent. In order to capture his attention, the brand must
be as distinct as possible. The best way to stir the consumer’s
interest when he is shopping is done through accentuating
visual brand aspects that are important to the consumer at the
point of purchase.
The research findings show that advertising was significant
in product categories in which the symbolic facet is more
important than the functional aspect (q1, q2, q3). Support for
this can be found in Hawes and Kiser (1980) and Bellizzi et al.
(1981), who showed that consumers who are very interested
in generic brands have a negative attitude toward advertising.
This research also supports de Chernatony and McDonald’s
(1998) analysis of Assael’s (1987) model that indicates that
advertising is a necessary strategic step in the three product
categories q1, q2 and q3. According to their analysis, the
importance of advertising in product category q1 is the result
of the need to present the advantages and the superiority of
their brand over competing quality brands; in q2 the
importance of advertising is a consequence of the need to
reduce the dissonance that may appear immediately after
 An investigation of the new generic consumer
Ram Herstein and Sigal Tifferet
purchasing the brand; and in product category q3, the
importance of advertising is the outcome of the need to
convey a simple, immediate, long-term message with the aim
of implanting the brand’s name in the mind of the consumer.
The results show that there are no differences in the
importance of price among the various categories. This means
that generic brand customers expect to find low prices in all
four product categories every time they buy a generic brand.
This finding contradicts de Chernatony and McDonald’s
(1988) analysis of Assael’s (1987) model, which states that
low prices are important only in product category q4. Our
results indicate that quality is perceived as extremely
important in product categories q1 and q2. In other words,
when involvement in the purchase is high, the consumer puts
strong emphasis on the product’s quality.
Conclusions and implications
In light of the renewed attention that generic brands have
been drawing in the past several years as a result of the global
geographic spread of discount stores and their penetration
into diverse product categories, a new study of generic brand
consumers is crucial. The findings of this study demonstrate
that marketers of generic brands as well as retailers who
specialize in selling generic brands must segment the generic
brand consumer market to some extent differently than was
done in the past. This research illustrates that the new generic
consumer has a large family, earns an average to above-
average salary, is educated and is between 26 to 55 years old.
Furthermore, the study’s findings show that the sales
potential of generic brands is greater than in the past. The
research shows that the new generic consumer is prepared to
purchase generic brands not only in product categories
defined as having low involvement and with low
differentiation (q4). This consumer will also buy brands
from product categories that have high involvement and little
differentiation among brands (q2), as well as product
categories defined as having low involvement and essential
differences among brands (q3). In order to promote the sales
of generic brands in product categories defined as high
involvement and with little differentiation among brands (q2)
as well as product categories defined as having low
involvement and with essential differences among brands
(q3), marketers and retailers of generic brands must base their
marketing strategy on improving the brand packaging and
making it more attractive, and on emphasizing the brand’s
quality in indoor advertising.
The results have significant implications for retailers
specializing in selling generic brands, for manufacturers who
market generic brands or intend to market them and even to
manufacturers of national brands. The power of the present
research is in its outline of the new generic consumer profile
and its characteristics. The study’s strength is also in its
recognition of new marketing opportunities not heretofore
associated with this market. The willingness of generic brand
marketers and retailers to enter product categories not defined
as generic will create new business avenues and a relative
advantage for them over their competitors, while guaranteeing
a larger market segment and an increased volume of sales in
the short term.
The study has several limitations. First, it focused on a
market characterized by economic instability, which may
contribute to strong readiness to purchase generic brands
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even in product categories not generic by definition. Second,
the study does not profile generic brand consumers based on
psycho-behavioral aspects.
Finally, we want to point out some future research ideas for
marketing and consumer research. First, it is imperative to
study the profile of the new generic consumer from the
perspective of cultural differences among countries and not
within countries. Second, future research must examine
generic consumers in markets of varying economic strength in
order to learn about the influence that market economics has
on the consumer willingness to buy generic brands in other
product categories.
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Assael, H. (1987), Consumer Behavior and Marketing Action,
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 An investigation of the new generic consumer
Ram Herstein and Sigal Tifferet
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About the authors
Ram Herstein is a Senior Lecturer at the Ruppin Academic
Center, Israel. He has published a number of publications on
branding in academic journals and is the author of the Israeli
books: Brand Management and Modern Branding. Dr Herstein
has a PhD from Middlesex University London. Ram Herstein
is the corresponding author and can be contacted at:
ramh@ruppin.ac.il
Sigal Tifferet teaches psychology at the Ruppin Academic
Center, Israel. Her research interests are in the areas of
Health Psychology and Evolutionary Psychology. Dr Tifferet
has a PhD from the Hebrew University of Jerusalem.
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 in toto to take
advantage of the more comprehensive description of the research
undertaken and its results to get the full benefit of the material
present.
Generic brands first rose to prominence in France in 1976
and three years later had become established in the USA,
Canada, Australia, Japan and most Western countries. Such
products were up to 40 percent cheaper than respective
national brands and around 20 percent below the price of a
retailer’s own brand. While generic brands were usually
considered as a separate entity, some retailers marketed these
products as a second level of their private brand.
The sizeable market share that generic brands had acquired
by 1982 came mainly at the expense of private brands. It is
believed that short-term marketing strategies typically
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Volume 24 · Number 3 · 2007 · 133 –141
associated with generic brands made them less of a threat to
established national brands.
However, by the mid-1980s the inferior quality of the
products had dampened consumer passion for generic brands
and their popularity began to diminish. A decade in the
wilderness then followed until generic brands re-emerged.
Many analysts believe that the arrival of discount stores and
their aggressive marketing tactics is chiefly responsible for this
second coming.
The generic brand consumer
Research conducted in the 1970s helped build a profile of the
generic brand consumer. In general, purchasers of generic
brands were:
.
part of a sizeable family needing to buy in large quantities
within a limited budget;
.
reasonably well educated – some observers felt that
educated consumers were better able to perceive the low
risks involved in purchasing these products;
.
older consumers living off pensions and therefore more
concerned with price;
.
risk takers that were willing to purchase unfamiliar brands;
and
.
negative towards advertising because of their low regard
for image values.
Contrary to expectation, evidence also suggested that generic
brands were purchased by average income earners. However,
there was conflicting evidence here because other research
found low earners to be the main consumers in this category.
Hernstein and Tifferet aim to build on these earlier studies
with their survey of customers leaving two large private chain
stores in central Israel, where a profusion of generic brands
are available. Participants completed a questionnaire and
stated the level of importance they attached to advertising,
packaging, quality and price in relation to different products.
Questions to help the authors construct a demographic profile
of the generic brand consumer were also included. Another
key aim of the study was to assess consumer readiness to
purchase generic brands in what are usually perceived as non-
generic categories.
Product categories and purchase behavior
Four separate categories of product were included in the
questionnaire. Category organization was primarily based on
existing evidence that the consumer decision-making process
is influenced by the level of buyer involvement with the
product and the perceived degree of differentiation between
competing brands. Thus the categories are distinguished by:
1 high involvement and perception of difference;
2 high involvement and low level of differentiation;
3 low involvement and perception of difference;
4 low involvement and low level of differentiation.
Prior studies had also suggested appropriate marketing
strategies for use within each specific category:
.
A focus on advertising to provide detailed information
about the brand that also serves to highlight the features
that make it unique.
.
The use of advertising to convey the satisfaction and
reliability offered by the brand.
.
Heavy promotion that includes special offers and free
samples based on a simple message. The logic here is that
 An investigation of the new generic consumer
Ram Herstein and Sigal Tifferet
consumers who try the product may demonstrate brand
loyalty in the future.
. Similar techniques to (3) in order to illustrate the
functional qualities of the product.
For the present study, products included within the respective
categories were:
1 computers and televisions;
2 jeans and perfume;
3 toothpaste and washing detergent; and
4 flour and rice.
The authors discovered a shift in certain elements in the
profile of typical generic brand consumers. For instance, there
was evidence that those earning above average incomes were
now purchasers of such products. This prompted the
assumption that the difficult economic climate had made
careful budgeting a necessity even for this class of consumer.
Findings also indicated that the generic brand buyer is getting
younger. Statistics showed that most consumers were between
26 and 55, and invited speculation that the economic
situation was again to blame for this apparent extension of
price consciousness into other age bands.
Sales potential for generic brands
Evidence suggests that customers are in fact willing to
purchase brands in non-generic categories. In this study,
Hernstein and Tifferet found that sales potential for generic
brands was strong in all categories except for the first. The
highest potential was in category (4), where consumers
generally seek to find a product that meets their minimum
requirements and satisfies their functional needs. Consumer
indifference within this category means they have little interest
in national brands.
The potential for generic brand sales in (2) is also high.
Products within this category are often similar, making it
difficult for consumers to choose. According to study
findings, this may prompt the consumer to select the
cheapest option – providing it is adequate for their
requirements. Consumer interest in (3) generally relates to a
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Journal of Consumer Marketing
Volume 24 · Number 3 · 2007 · 133 –141
product’s functional attributes and the authors believe that
they will be enticed by appearance. Marketers can therefore
exploit the potential in this category by focusing on the
packaging to help make the brand stand out to the indifferent
consumer. Consumers in (2) might also differentiate between
what they perceive as similar brands if distinguishing
packaging is present.
As expected, the significance of advertising increases when
consumers attach more importance to the symbolic attributes
of a product. Consumer involvement is the key issue where
product quality is concerned, since quality becomes more
important when involvement is high as in (1) and (2). As far
as value is concerned, the generic brand purchaser expects
low prices in all product categories. This finding contradicts
earlier research and author expectations that price would only
be a key factor in (4).
While the survey suggests an increasing potential for generic
brand sales, marketers may need to recognize the changing
profile of the generic brand consumer if they are to expand
into new product categories and fully exploit the
opportunities provided.
The authors, however, warn against generalizing the
findings of their research. They point out that the study
took place within a framework of economic uncertainty and
that this may have influenced consumer willingness to
purchase generic brands in categories normally regarded as
non-generic. Further investigation focusing on markets of
differing economic strength is required before any conclusions
can be drawn about the influence of market economics on
consumer behavior in this context. Similarly, Hernstein and
Tifferet suggest that introducing a cultural perspective into
the research could prove highly informative. Cultural
differences within and across countries may have a
significant bearing on the profile of the generic brand
consumer.
(A précis of the article “An investigation of the new generic
consumer”. Supplied by Marketing Consultants for Emerald.)