Business Horizons (2018) 61, 487—496

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How to brand your private labels

Inge Geyskens a, Kristopher O. Keller b,*, Marnik G. Dekimpe a,c,
Koen de Jong d

a
Tilburg University, Warandelaan 2, 5037 AB Tilburg, The Netherlands
b
Kenan-Flagler Business School, University of North Carolina at Chapel Hill, 300 Kenan Center Drive,
Chapel Hill, NC 27599, U.S.A.
c
KU Leuven, Leuven, Belgium
d
International Private Label Consult (IPLC), Loonsebaan 127, 5263 CM Vught, The Netherlands

KEYWORDS Abstract Private labels have become ever-more important and are slowly turning
Marketing; into brands of their own. Retailers increasingly offer three-level ‘good, better, best’
Retailing; private-label programs that include economy, standard, and premium private-label
Private-label products; tier goods. For each of these tiers, retailers must decide under what name to brand
Branding; their private label. They can either assign their store banner name to a private-label
Brand names; tier or go for a unique brand name that is separate from the retailer banner. The
Brand strategy purpose of this article is to outline the advantages and limitations of these two
branding strategies: store-banner branding versus stand-alone branding. Herein, we
also provide a series of recommendations regarding when to use each brand strategy,
based on characteristics of the retailer and the environment in which it operates.
# 2018 Kelley School of Business, Indiana University. Published by Elsevier Inc. All
rights reserved.

1. Private labels are becoming brands
of their own
Private label (PL) products, also known as store
brands or retailer brands, have been extremely
successful in recent years. Yearly PL sales in the
* Corresponding author
E-mail addresses: i.geyskens@tilburguniversity.edu (I. Geys-
kens), kristopher_keller@kenan-flagler.unc.edu (K.O. Keller),
m.g.dekimpe@tilburguniversity.edu (M.G. Dekimpe),
kdejong@iplc-europe.com (K. de Jong)
consumer packaged goods industry in the U.S.
exceed $115 billion and account for a market share
of more than 22% (PLMA, 2016). PL sales in European
consumer-packaged-goods markets, traditionally at
the forefront of PL developments, are even more
substantial with PL shares often exceeding 30%,
while still showing impressive growth rates. In Spain
and Poland, for example, PL shares have increased
by a staggering 10% from 2009 to 2013, resulting
in market shares of 41% and 24%, respectively
(Nielsen, 2014).
Originally created to provide the cheapest
products in the assortment at an acceptable but

0007-6813/$ — see front matter # 2018 Kelley School of Business, Indiana University. Published by Elsevier Inc. All rights reserved.
https://doi.org/10.1016/j.bushor.2018.01.015
488
Figure 1. Example of three-tiered private label (PL) architecture of French retailer Système U
low quality, PLs have evolved into products with a
quality comparable to, or even exceeding, that of
national brands (Dekimpe & Deleersnyder, 2018; ter
Braak, Dekimpe, & Geyskens, 2013). This transition
has been recognized both in the academic literature
and among practitioners. Martos-Partal, González-
Benito, and Fustinoni-Venturini (2015), for exam-
ple, investigated PLs’ ability to attract other
than merely the highly price-sensitive customer
segments, while de Jong (2011, 2015) documented
how retailers have invested considerable resources
into building their stores to become strong brands,
and often placed their PLs at the center of this
strategy. After all, stronger PLs allow the retailer to
offer a more differentiated assortment, which
insulates it better from competitors by avoiding
“competitive price matching” (Kireyev, Kumar, &
Ofek, 2017, p. 2).
Yet, while acknowledging their increasing quality
parity with national brands, consumers may still
have difficulties differentiating among different
PLs. Schnittka et al. (2015), for example, provide
evidence that consumers may be able to recognize
PLs, but not to associate them with the correct
retailer. Similarly, Szymanowski and Gijsbrechts
(2012) have demonstrated that consumers consider
PLs as a separate brand class rather than as
individual private brands from different retailers.
To overcome this impediment and unlock PLs’ true
potential, the next step is to create unique PL
brands (Planet Retail, 2010). This transition is
feasible, as retailers have achieved the “necessary
mass” for investments in essential branding
activities (Kumar & Steenkamp, 2007, p. 9).
The key first element in creating true PL brands
is the development of a multi-tiered offering.
Three-tiered PL programs follow a ‘good, better,
I. Geyskens et al.
best’ approach. This includes an economy and a
premium PL tier in addition to the standard PL that
has been around for a long time (Geyskens, Gielens,
& Gijsbrechts, 2010). Whereas economy PLs are
no-frills, bottom-of-the-market PLs that typically
economize on more expensive ingredients to reduce
costs, standard PLs tend to imitate mainstream-
quality manufacturer brands and are positioned
as mid-quality alternatives (Vroegrijk, Gijsbrechts,
& Campo 2016). Premium PLs, in turn, are at the top
end of the market and deliver quality equal to–—or
even exceeding–—that of premium-quality national
brands while sometimes even exceeding national
brands’ prices (ter Braak, Geyskens, & Dekimpe,
2014). Figure 1 illustrates the three-tiered PL
architecture for the French retailer Système U in
the apricot-jam category. The design as well as the
quality of Système U’s economy PL Bien Vu is modest
and contains only 35 g of fruit per 100 g. The quality
of its standard PL U, on the other hand, is equivalent
to that of the market leader Bonne Maman, con-
taining 50 g of fruit per 100 g, whereas the premium
PL U Saveurs is of a higher quality and even contains
56 g of fruit per 100 g. For the latter, Système U
opted for fruit from the Roussillon region, and uses a
unique and more attractive jar, which helps to
justify a 97% higher price than the leading national
brand.1
The second key element in creating true PL
brands is choosing brand names that allow consum-
ers to more easily differentiate among various PLs.
After all, “the key to branding is that consumers
perceive differences among brands in a product
category” (Keller, 2012, p. 36). Some PLs have
1
See de Jong (2015) for a more detailed exposition.
How to brand your private labels
already made this transition. One example is Lob-
law’s President’s Choice, which is now considered to
be the most trusted consumer packaged goods
brand in Canada. Shortly after its launch, it became
the market leader in the chocolate-cookie category
despite its limited distribution–—it sold in only one
retail chain. Loblaw’s senior vice president of mar-
keting even went so far as to say: “I take offense to
thinking about President’s Choice as a store brand
[as] Canadians don’t consider it one” (Kolm, 2016).
In naming their PL tiers, retailers have an impor-
tant decision to make: Should they align their PL
brands with their banners or should they use a
stand-alone brand name that does not link to the
banner? Rebranding a PL is a very costly exercise. It
is therefore imperative that these decisions are
made in an informed way. We will first discuss the
branding decision for the standard PL tier, which is
still the largest tier with most retailers. Next, we
turn to the premium PL tier, which has recently
shown the highest growth rates (ter Braak et al.,
2014), and the economy PL tier, which is mostly
introduced to limit the further growth of the
hard-discount format (Vroegrijk et al., 2016).
2. Branding the standard PL tier
Standard PLs, which are positioned as mid-quality
alternatives that imitate mainstream national
brands at a lower price, have been around for a
long time. In branding their standard PLs, retailers
Figure 2. Example of a stand-alone and a store-banner branded standard private labels
489
can either choose stand-alone branding and avoid
an explicit link between store brand and retail
banner, or they can choose store-banner branding
and use their store-banner name and/or logo to
clearly reveal their ownership. If a retailer uses
store-banner branding, the link between PL product
and retailer is obvious. Consequently, positive
spillovers become more likely. Positive spillovers
may materialize through familiarity effects because
consumers feel less uncertain about the quality of
an unknown product if they are familiar with
the brand name (Sethuraman & Gielens 2014),
especially when this name corresponds to the
trusted banner name. As such, retailers with a
solid reputation may benefit from consistently
using their banner name on their PL. Figure 2
provides examples of both PL-branding strategies.
2.1. Jumbo case study
To illustrate the advantages that store-banner
branding may bring, we analyze the case of a Dutch
retailer, Jumbo, that engaged in a strategic
relaunch of its complete standard PL offering.
The retailer follows an everyday-low-price strategy
and offers lowest prices where possible on wide
ranges of fresh and ambient foods. Jumbo stores
carry a range of up to 30,000 products. The stores
have a friendly and modern design, and offer
specialty sections such as a bakery, and deli
counters for fresh foods. The banner currently
490
operates around 580 stores, and has an 18.4% share
of the Dutch grocery market (Planet Retail, 2016).
Instead of continuing to work with the
stand-alone name O’Lacy that it used for its
standard PL offering of many years, the complete
range of about 1,600 SKUs was relaunched to carry
the store banner (Jumbo) on the pack. The grocer
also added lifestyle imagery as well as high quality
food photography and a more consistent and
sophisticated design architecture to the brand. In
early 2009, the first PLs carrying the Jumbo name
appeared on the shelves, gradually replacing
all articles under the stand-alone brand O’Lacy.
Figure 3 portrays the old stand-alone brand O’Lacy,
and the new store-banner brand Jumbo in, respec-
tively, the rice and fabric-conditioner categories.
Overall, the PL rebranding was a success. PL sales
soared (across close to 100 categories studied, an
average increase of 27% was observed in the first
quarter after the rebranding), and profits also in-
creased. By using its banner name on its standard
PL, Jumbo successfully capitalized on its solid
reputation and positive association shoppers have
with Jumbo stores (de Jong, 2015). The rebranding
ensured PL growth in product categories where PLs
traditionally are weaker relative to national brands.
Those categories were characterized by:
 A lower share of the stand-alone O’Lacy PL brand;
Figure 3. The replacement of the stand-alone PL brand O’Lacy by the store-banner brand Jumbo
I. Geyskens et al.
 A stronger number one national brand;
 More brand innovations; and
 Heavy advertising.
These findings are depicted in Figure 4, which
portrays the 50% lowest and 50% highest scoring
product categories on the four category character-
istics listed above. PL performance improved
especially in categories in which national brands
are typically strong (and where O’Lacy performed
less well), such as breakfast cereals and chewing
gum. On average, PL sales increased by 33.6% after
the rebranding when the market share of the
stand-alone brand O’Lacy within the category was
low–—compared to 20.7% when it was high. The new
Jumbo PL also performed particularly well in prod-
uct categories with a strong (+45.5% growth in PL
sales) rather than weak (+9.0% growth in PL sales)
position of the number one brand, a high (+45.4%
growth in PL sales) versus a low (+10.7% growth in PL
sales) degree of brand innovations, and heavy
(+44.6% growth in PL sales) versus little (+12.1%
growth in PL sales) advertising. Examples here
include laundry detergents and dishwasher tablets.
In those categories, having the backing from the
retailer’s trusted banner name was especially
needed and indeed made a difference (Table 1).
How to brand your private labels 491

Figure 4. Store-banner branding helps PL sales to grow in categories that have traditionally been the stronghold
of national brands

50 50 45.50
Growth in PL sales following

Growth in PL sales following

the relaunch with a store-

the relaunch with a store-

banner brand name (%)

banner brand name (%)

40 33.61 40

30 30
20.65
20 20
9.04
10 10

0 0
Low High Low High
Market share of O'Lacy within the category Market share of the number-one brand in the category

50 45.37 50 44.61
Growth in PL sales following

Growth in PL sales following

the relaunch with a store-

the relaunch with a store-

banner brand name (%)

banner brand name (%)

40 40

30 30

20 20
10.68 12.06
10 10

0 0
Low High Low High
Innovation intensity by brands in the category Advertising intensity by brands in the category

Note: Division between low and high based on a median split.

Jumbo’s category managers implemented a the number of new Jumbo SKUs was larger than
number of tactical adjustments that helped the former number of O’Lacy SKUs, the effect of
to amplify the overall positive effect of the the rebranding on PL sales was much more
rebranding, as portrayed in Figure 5. Specifically, favorable (+53.9%) than when the number of new
they used the occasion to reorganize the shelf Jumbo SKUs stayed the same or dropped (+16.8%).
space in a number of categories. On average, PL Finally, when the retailer added larger package
sales increased by 47.1% when the shelf was sizes under the Jumbo PL than were already
substantially reorganized at the time of the available at the retailer, PL sales increased, on
rebranding, compared to only 24.1% when not. average, by 110.2% rather than 15.8%. For
The coffee category, for which the shelves were example, for muesli, the retailer added a much
completely overhauled, provides a case in point. larger package size to its assortment, leading to a
After the rebranding, PL sales of coffee pads 65% PL sales increase and an estimated additional
increased by a whopping 80%, leading to s3,000 category profits per week.
approximately s12,500 additional category profits As this application clearly illustrates, strategi-
(across PLs and national brands) per week. When cally rebranding a stand-alone standard PL to a

Table 1. Additional results from our Jumbo research

We analyzed all categories in which the O’Lacy PL was present, and for which we had a minimum of 13 weeks of data
available after the rebranding so that we could econometrically evaluate its impact. We focused on categories in
which PL SKUs were introduced relatively quickly one after the other (12 weeks). Using an error-correction model
[see van Heerde, Gijsenberg, Dekimpe, and Steenkamp (2013) or Frison, Dekimpe, Croux, and De Maeyer (2014) for
an in-depth discussion on this modeling approach], we calculated the baseline sales of the new Jumbo PL (1) after
the dust had settled (i.e., in the longer run) and (2) after filtering out possible confounding effects of PL price,
national-brand price, PL promotions, national-brand promotions, advertising, stock-outs, and seasonal influence.

Of the 92 categories studied, 39 categories showed a significant increase in PL sales, in 40 categories PL sales were
not affected, and 13 categories experienced a decline in PL sales. On average, PL sales increased by 27% per
category, while category sales increased by 4%. Profit implications were in the same line. Out of 92 product
categories, 45 categories became more profitable in the quarter after the rebranding (compared to the quarter
before), 23 categories did not change in terms of profitability, while another 24 categories were affected negatively
profitwise.
492 I. Geyskens et al.

Figure 5. The retailer’s tactical assortment decisions can amplify the positive effect of a rebranding decision

60

Growth in PL sales following

the relaunch with a store-
50 47.07

banner brand name (%)

40
30 24.08
20
10
0
No Yes
Reorganization of the shelves during the rebranding

60 53.85

Growth in PL sales following

the relaunch with a store-
50

banner brand name (%)

40
30
20 16.80

10
0
Equal or less More
Number of Jumbo SKUs relative to number of O'Lacy
SKUs

120 110.22
Growth in PL sales following
the relaunch with a store-

100
banner brand name (%)

80
60
40
15.80
20
0
No Yes
Big package size added

store-banner branded PL can help a trusted PL tiers. Switzerland’s SPAR, in contrast, added a
retailer’s performance, especially when the stand-alone-branded economy tier (Jeden Tag)
tactical decisions of the category managers are and a store-banner branded premium PL tier (SPAR
appropriately aligned by: Premium) to its store-banner branded standard
tier (SPAR).
 Reorganizing the shelf at the time of the Premium PL tiers are differentiated from other
rebranding; PLs along two dimensions. First, they are positioned
at the top end of the market and deliver quality
 Increasing the number of SKUs under the equal to premium-quality national brands, with
rebranded PL; and similar–—and occasionally even higher–—prices
(Kumar & Steenkamp, 2007), but better quality than
 Adding a larger package size to the assortment standard PL tiers. This is called vertical differenti-
under the rebranded PL. ation. Second, they offer unique features such as
ingredients, flavors, or packaging that cannot
3. Branding the premium and economy be found with other PL tiers or competing
PL tier national brands, called horizontal differentiation
(ter Braak et al., 2014). Using a large pan-European
3.1. Premium PL tiers sample of over 220 PL-branding decisions made by
over 150 retailers across more than 25 countries,2
Also for their premium and economy PL tiers, Keller, Dekimpe, and Geyskens (2016) found that
retailers can either go for stand-alone branding or retailers perform better when using store-banner
store-banner branding. The U.K.’s Tesco, for
example, does not only use its banner name on
its standard PL tier (Tesco), but also on its premium 2
In around 57% of the cases, stand-alone branding was used,
(Tesco Finest) and economy (Tesco Everyday Value) while in 43%, store-banner branding was used.
How to brand your private labels
branding for their premium PL when they have a
higher brand equity or a hi-low price format. As
consumers may be uncertain about what to expect
from a newly-introduced premium PL tier,
store-banner branding can be used by a high-equity
retailer as a signal to consumers that its product
claims are credible–—because false claims would put
the future reputation of the retailer at stake and
result in intolerable economic losses (Kirmani &
Rao, 2000)–—thereby lowering consumers’
perceived purchase risk and increasing retailer
performance. In addition, store-banner branded
premium PLs may work as silent salesmen of
top-level quality who continue to promote the
store during the span of the products’ use in the
home (de Jong, 2011), thereby further increasing
retailer sales across PLs and national brands. As to
hi—low retailers, they can reduce the quality
uncertainty that may surround their premium tiers
by exploiting their upscale image and using a
store-banner-related name because “store image
acts as an important indicator of PL quality”
(Semeijn, van Riel, & Ambrosini, 2004, p. 248). This
positively affects the premium tier’s sales and,
thereby, retailer performance.
Conversely, it becomes better to use stand-alone
branding on the premium tier when the retailer has
a lower brand equity and/or uses an everyday-
low-price strategy. Cue-consistency theory holds
that when two cues are inconsistent, they are less
predictive of quality than when they present con-
sistent information (Miyazaki, Grewal, & Goodstein,
2005). The low brand equity of a retailer and its
everyday-low-price strategy do not match the
quality signal sent by higher priced premium PLs,
making stand-alone branding the better strategy in
both instances.
Retailers that are at the forefront of
internationalization–—such as Carrefour and
Auchan–—capitalize on their strong PL base by also
offering their PL products in overseas markets
(Gielens, Helsen, & Dekimpe, 2012). The same
retailer can nevertheless use different branding
strategies across countries. For example, for many
years, Carrefour used the stand-alone label No.
1 for its economy tiers in Poland and Romania but
Carrefour Discount in France. This practice reveals
that for some retailers, it may be preferable to
adapt their PL architecture to the varying
conditions in local markets. In terms of market
characteristics, Keller et al. (2016) studied the
retail environment, which influences the extent
to which retailers wish to differentiate from each
other; the cultural environment, which influences
the needs consumers satisfy through the acquisi-
tion and use of products, and the institutional
493
environment, which affects the extent to which
PL manufacturers live up to the rules and produce
PLs that meet the agreed-on quality level. Since
the success of international PL strategies relies on
the ability to build tailored solutions to each
market, retailers may be more likely to use
store-banner branding in some markets than in
others.
Turning to the retail environment, Keller et al.
(2016) found that store-banner branding is the
better option for a premium PL in markets where
the degree of retail concentration is low (i.e.,
features competition from many banners). Because
premium PLs are genuinely unique products, they
can be an excellent instrument with which to stand
out (Sethuraman & Raju, 2012). The closer the
premium PL can be associated with the retailer,
as is the case when store-banner branding is used
for these top-quality products at the retailer,
the more it can be a useful tool to differentiate
the retailer from its competitors (Thain & Bradley
2012).
As to the country’s cultural environment: The
higher its uncertainty avoidance, the better it is to
use store-banner branding on the premium tier. The
higher price of premium PLs increases the financial
risk, which may deter uncertainty-avoidant con-
sumers from trying the premium tier. In a society
that is generally characterized by risk aversion
(such as, for example, France, Greece, and Japan),
uncertain consumers expect a sign of quality reas-
surance from the retailer, which can be provided
through store-banner branding the premium tier, as
bearing the store-banner name has a risk-relieving
function. Conversely, the higher a society’s empha-
sis on status–—as is the case in many emerging
markets–—the better it is to use stand-alone brand-
ing for premium tiers. In such societies, consumers
attach more importance to product brand names.
Buying brands rather than PLs is a means through
which consumers can express class differences and
aspirations. Thus, retailers may be better off to
disguise the PL nature with a stand-alone name.
Also, in countries with a weak rule of law, stand-
alone branding is the better strategy as it helps
retailers to insulate themselves from the potential
of negative spillover effects when products deviate
from contractually defined production standards or
encounter a product-harm crisis. Because premium
PLs are products with expensive, high-quality in-
gredients (ter Braak et al., 2014), they are products
for which deviating from contractually defined
standards may pay off considerably for (indepen-
dent) PL suppliers. Moreover, a premium PL’s unique
features make it difficult for the retailer to replace
a cheating supplier. The combination of high payoffs
494
from cheating with a low probability of being re-
placed makes deficiencies more likely for premium
PLs in countries characterized by a weak rule of law,
making stand-alone branding the better strategy for
premium tiers in countries that score low on the rule
of law.
In sum, neither store-banner branding nor
stand-alone branding is the superior branding
strategy for the premium PL tier in all instances,
which also explains why both options are still used.
Nevertheless, making the right strategic choice is
not inconsequential, since not aligning the selected
branding strategy for the premium PL with the
specific features of the retailer and the market in
which it operates negatively affects that retailer’s
sales productivity.
3.2. Economy PL tiers
Finally, economy PL tiers are clearly vertically
differentiated from standard PLs in terms of quality.
They are bottom-of-the-market PLs with the lowest
prices, but with acceptable quality. Economy PLs
are often introduced to prevent a further erosion of
one’s customer base by hard discounters (Vroegrijk
et al., 2016). This motivation is very different from
that of the premium tiers, which are used more to
differentiate the retailer from competitors.
Hard discounters, such as Aldi and Lidl, offer
rock-bottom prices and a limited assortment that
is dominated by PLs. Of late, they have become very
successful. Market share levels have exceeded 30%
in Norway, Germany, and Denmark (Euromonitor,
2016), and these retailers are directing their
attention to the U.S. A traditional retailer’s
economy PL is a viable alternative to the hard
discounters’ low-priced private brands. Yet, many
retailers appear to be reluctant to use the
store-banner brand to endorse their economy PL.
They seem to fear that perceived low product
quality could result in shopper dissatisfaction,
which might have a negative impact on overall
shopper trust in the retailer (IPLC Research,
2016).3 For this PL tier, the choice of a non-fitting
(non-aligned) naming strategy does not result in a
sales (productivity) decrease (Keller et al., 2016),
while it does, as indicated before, for the premium
tier. That is, for their economy PL, retailers can use
store-banner branding and stand-alone branding
alike, regardless of the retailer’s brand equity, its
3 format. In contrast, stand-alone branding is the
Consistent with this argumentation, the proportion of store-
banner branding in Keller, Dekimpe, & Geyskens (2016) was
considerably higher (74%) for the premium PL tier than for the
economy PL tier (16%).
I. Geyskens et al.
pricing strategy, and the characteristics of the
country it operates in.
Still, retailers should be aware that the risks of
negative spillovers in case of product-harm crises
remain when opting to use store-banner branding
for their economy tier. A product-harm crisis is a
discrete event in which products are found to be
defective and therefore dangerous to at least part
of the product’s customer base (Cleeren, Dekimpe,
& van Heerde, 2017). Product-harm crises are not
only harmful for consumers, but also the reputation
and equity of the retailer may get tarnished if
products need to be recalled from the distribution
system. Indeed, a product-harm crisis in one
product category can spill over to all product
categories with the same name and tarnish the
banner’s overall image. While in the past
product-harm crises were the exception rather than
the rule, the last 2 decades have witnessed a
considerable increase in their number (Borah &
Tellis, 2016). As such, retailers may better play
on the safe side by using stand-alone branding on
their economy PL tiers.
4. Final summary
A key decision that retailers face for their standard,
premium, and economy PL tiers is whether to use
their store-banner name and/or logo to clearly
reveal their ownership of these products. These
choices should not be made lightly, since they have
substantial performance implications, especially
for the standard PL tier (which is still the largest
tier for most retailers) and for the premium tier
(which is, for many retailers, the fastest growing
tier). Standard PLs can benefit from store-banner
branding due to positive spillovers: consumers feel
less uncertain about the quality of an unknown PL
product if they are familiar with its brand name. We
illustrated the importance of making the right
branding decision for the standard PL for Jumbo,
a leading Dutch retailer that replaced its
stand-alone standard PL brand with a store-banner
brand, and enjoyed significant PL sales increases
and additional profits as a result.
PL-branding decisions have recently come to the
forefront for the smaller, but rapidly growing, pre-
mium PL tier. For the premium tier, retailers are
better off using store-banner branding when they
have a higher brand equity and/or a hi—low price
better option for retailers with a lower brand equity
and/or an everyday-low-price strategy. This is not
to say that retailers with an everyday-low-price
How to brand your private labels 495

Figure 6. Decision tree for PL-branding decision

Banner
equity

Low High

Economy tier Standard tier Premium tier Economy tier Standard tier Premium tier

Stand-alone Stand-alone Stand-alone Preferably Store-banner Store-banner

branding branding branding stand-alone branding branding for hi-
branding (in low retailers in
light of the countries with
increasing a high retail
number of concentration
product-harm and high
crises) uncertainty
avoidance.
Stand-alone
branding for
everyday-low-
price retailers
in countries
with a high
emphasis on
status and a
weak rule of
law

strategy should never use store-banner branding for References

a premium tier: if they have a very high equity, this
may outweigh the effect of their pricing strategy.
Lastly, whereas store-banner branding for the
premium tier is, on average, better in countries
with less retailer concentration and where
consumers are risk averse, stand-alone branding
is to be preferred in countries where consumers
are status seekers and where the rule of law is
low.
For the economy tier, the branding decision does
not matter much. To avoid unnecessary risk,
retailers are advised to use stand-alone branding
in order to avoid that costly product recalls
may destroy their carefully nurtured brand equity.
Figure 6 summarizes the key decision factors.
Finally, we focused on the grocery retail market.
The historically fragmented grocery retail market
has rapidly moved to a more consolidated one, with
a few players holding more and more of the power.
An important reason behind retailers taking the
driving seat is that they have become competitors
to their suppliers by selling PLs (Geyskens, 2018).
However, retailer power and PL shares are also
increasing in other retailing areas, such as in elec-
trical goods, clothing, furniture, and do-it-yourself.
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