Brand, Identity and Reputation: Exploring, Creating New Realities ...

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The Impact of Copycat Packaging Strategies on Private Labels‘ Adoption Coelho do Vale, Rita, Catholic University of Portugal, Católica Lisbon- School of Economics and Business, Portugal Verga Matos, Pedro, Technical University of Lisbon, ISEG, Portugal Introduction Private Labels have been gaining increasing importance throughout the world (Kumar & Steenkamp, 2007) with store brands being present on almost every product category (Geyskens, Gielens, & Gijsbrechts, 2010). Private labels (PL) are estimated to account for one of every five items sold every day in USA (Ailawadi, Pauwels, & Steenkamp, 2008), representing around 20% of the average purchases made worldwide (Lamey, Deleersnyder, Dekimpe, & Steenkamp, 2007). Nowadays we are assisting to a proliferation of segmentation strategies at the level of private labels (Kumar & Steenkamp 2007), indicating that retailers are not just competing on price, but instead are trying to conquer a significant market share traditionally owned by manufacturers. From an initial focus on price, private labels have moved to a quality positioning, and more recently, to a status orientation positioning, extracting benefits from the retailers‘ ownbrand image (Steenkamp, Heerde & Geyskens, 2009). Anecdotal evidence suggests that the stiff competition between national brands and private labels has led many retailers to adopt packaging strategies very similar to the ones developed and used by national brands, often named copycat strategies, eventually hoping to benefit from positive associations held by consumers regarding these brands. Since packaging can affect consumers‘ perceptions of products, increase consumers‘ perceptions of quality (Butkeviciené Stravinskienė & Rūtelionė, 2008) and strengthen the consumer-brand relationship (Underwood, 2003), it is of great relevance to understand the impact of these copycat packaging strategies on consumers‘ behavior. The present research analyzes the impact of copycat strategy adoption by retailers on consumers‘ product quality perception and decision-making process, assessing to what extent the adoption of this type of strategies reveals to be beneficial for the retailers, enhancing likelihood of PL adoption. Private Labels and Copycat Packaging Strategies Previous research has focused in different private labels (PL) aspects as competitive price interaction (Coterill, Putsis & Dhar, 2000; Putsis, 1997; Steiner, 2004), private labels‘ growth across different categories (Hoch & Banerji 1993), the impact of specific promotional tools on private label penetration (Sethuraman & Mittelstaedt, 1992), the link between private label performance and economic conditions (Lamey et al., 2007; Quelch & Harding, 1996), and the impact of private labels share on store loyalty (Ailawadi et al., 1998). Main results from these studies are quite diverse and disperse. While Coterill et al. (2000) found a negative relationship between national brand-private label price differential and private label market share, Putsis‘ findings (1997) indicate that successful private label penetration lowers the average price of branded products. On a different perspective, Lamey et al. (2007) findings indicate a negative, but asymmetric, relationship between consumers‘ proneness to adopt private labels and economic cycles. Despite these studies, there are still several unanswered questions about this prevalent phenomenon in consumers‘ shopping reality. It seems therefore of special relevance to analyze one of the factors that may have a strong impact on the PL adoption: retailers‘ packaging strategies for their store brands. This research analyzes the influence of different private-label package formats on consumers‘ decision-making process and consumers‘ quality perception. More precisely, we are interested in assessing the impact of introduction of private labels as ―copycats‖ in the market. To our knowledge there are no studies that address the consequences of such marketing strategy in terms of consumers‘ quality perception, attitudes and purchase behavior. Packaging is a significant marketing tool that can influence consumers‘ attitude towards a product. Several studies outlined that the packages‘ characteristics as shape (Folkes, Martin, & Gupta, 1993; Raghubir & Krishna, 1999), size (Coelho do Vale, Pieters, & Zeelenberg, 2008; Wansink, 1996), and brand logo location (Lans, Pieters, & Wedel, 2008) can affect the way consumers evaluate and choose the products. We predict that the adoption of packaging visual characteristics similar to the ones of national brands can lead to a stimulus generalization effect with features associated with the national brand manufacturer being generalized to the private-label (Burshteyn & Buff, 2008). This would mean that consumers can transpose from the national brands that are being imitated a set of characteristics to the private labels that adopted the copy cat strategy. In our current framework we predict that as compared with an own-branding PL packaging strategy, the adoption of copycat strategies may increase consumers‘ PL quality perception, which may enhance consumers‘ likelihood of purchase of PL. Studies We examined our predictions in four studies. In study 1 we conducted a field-study in which we assessed the level of penetration of copycat strategies in order to analyze if there was evidence in the market for this kind of phenomenon. 248
Data was collected by independent judges across the main six Portuguese retailers. Information was gathered for 172 sub-product categories about the existence of private labels, first price, original brands and copycat packaging strategies, across six main retailing chains. Results indicated that the adoption of copy cat packaging strategies was a prevalent phenomenon, present in about 34,2% of product categories, across retailers. It is therefore of great relevance to understand the impact of this type of packaging strategies on consumers‘ PL adoption process. Study 2 analyzed to what extent copycat packaging strategies can influence consumers perceptions regarding product quality, production origin and purchase confusion. Participants were randomly distributed among two groups. Each group of participants was presented with a set of 12 product combinations and answered to a battery of questions regarding those products. Groups differed in the type of product combinations that were exposed to: one group was presented to a combination of national brands and a private label with own-branding packaging, while other group was presented to a combination of national brands and a private label with copy-cat packaging. Results indicated that consumers perceive copycat products as being more similar to national brands in what concerns packaging, quality, origin and benefits compared with own branding PLs, highlighting the importance of better understanding the impact of these strategis on consumers‘ decision-making process. Study 3 assessed the influence of PL copycat packaging strategies on consumers‘ likelihood of purchase. A convenience sample was used, composed by professors and employees of a large European University that were typically involved in the purchase of groceries to their households. An online supermarket was created, offering a wide variety of national brands and PLs. Participants were given a shopping list and were told to shop in the online supermarket items presented in the list. Results indicated that while for hedonic product categories the PLs packaging strategy (copycat vs own brand image) does not influence the choice of consumers, results were statistically significant for utilitarian products, with consumers choosing more PL‘s with copycat packaging than with own image packaging. A fourth study analyzed on a supermarket context the impact of copy cat packaging strategies on likelihood of purchase. It followed a very similar design to study 3, but this time a real supermarket was created on the University facilities. Students were given a shopping list and asked to shop as they would do in a regular supermarket. Findings indicated once more that the impact of PL copy cat packaging strategies is mostly significant on the utilitarian categories, with consumers‘ showing a higher propensity to purchase PL when in presence of a copy cat package versus when in presence of a PL with own branding package. Overall, these four studies provide support to our predictions, indicating that copycat packaging strategies can play a major role in terms of consumers‘ private label adoption, contributing to a higher preference for store brand products. References Ailawadi, K., Pauwels, K., & Steenkamp, J.B. (2008). Private-Label use and Store Loyalty. Journal of Marketing, 72 (Nov), 19-30. Burshteyn, D., & Buff, C.L. (2008). Private-Label Brands, Manufacturer Brands, and the Quest for Stimulus Generalization: An EEG Analysis of Frontal Cortex Response. Review of Business Research, 8(6), 92-6. Butkevičienė, V.; Stravinskienė, J., & Rūtelionė, A. (2008). Impact of Consumer Package Communication on Consumer Decision Making Process. Engineering Economics, 1 (56), 57-65. Coelho do Vale, R., Pieters, R., & Zeelenberg, M. (2008). Flying Under the Radar: Perverse Package Size Effects on Consumption Self-Regulation. Journal of Consumer Research, 35 (October), 380-390. Coterill, R., Putsis, W.J., & Dhar, R. (2000). Assessing the Competitive Interaction Between Private Labels and National Brands. Journal of Business, 73 (1), 109-137. Folkes, V., Martin, I., & Gupta, K. (1993). When to Say When: Effects of Supply on Usage. Journal of Consumer Research, 20 (Dec), 467-477. Geyskens, I., Gielens, K., Gijsbrechts, E. (2010). Proliferating Private-Label Portfolios: How Introducing Economy and Premium Private Labels Influences Brand Choice. Journal of Marketing Research, 47 (5), 791-807. Hoch, S., & Banerji, S. (1993). When Do Private Labels Succeed?. Sloan Management Review, 34 (4), 57-67. Kumar, N., & Steenkamp, J.B. (2007). Private Label Strategy: How to Compete With Store Brands. Boston: Harvard Business School Press. Lamey, L., Deleersnyder, B., Dekimpe, M., & Steenkamp, J.B. (2007). How Business Cycles Contribute to Private-Label Success: Evidence from the United States and Europe. Journal of Marketing, 71 (Jan), 1-15. Lans, R., Pieters, R., & Wedel, M. (2008). Competitive Brand Salience. Marketing Science, 27(5), 922-931. Putsis, W.J. (1997). An Empirical Study of the Effect of Brand Proliferation on Private Label- National Brand Pricing Behavior. Review of Industrial Organization, 12, 355-371. Quelch, J., & Harding, D. (1996). Brand Versus Private Labels: Fighting to Win. Harvard Business Review, 37 (Winter), 99-109. Raghubir, P., & Krishna, A. (1999). Vital Dimensions in Volume Perception: Can the Eye Fool the Stomach?. Journal of Marketing Research, 36 (Aug), 313-326. Sethuraman, R., & Mittelstaedt, J. (1992). Coupons and Private Labels: A Cross-Category Analysis of Grocery Products. Psychology and Marketing, 9(6), 487-500. Steenkamp, J.B., Heerde, H., & Geyskens, I. (2009). What Makes Consumers Willing to Pay a Price Premium for National Brands over Private Labels?. Journal of Marketing Research, 47 (6), 1011-24. Steiner, R. (2004). The Nature and Benefits of National Brand/Private Label Competition. Review of Industrial Organization, 24, 105-127 Underwood, R. (2003). The Communicative Power of Product Packaging: Creating Brand Identity via Lived and Mediated Experience. Journal of Marketing, (Winter), 62-76. Wansink, B. (1996). Can Package Size Accelerate Usage Volume?. Journal of Marketing, 60 (July), 1-14. 249
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Book of Proceedings Brand, Identity
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Session 1.1 Emotional Branding in T
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p.31) consumers tend to those sourc
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Tables and figures Brand perception
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Malaysia‘s Global Halal Hub - ―
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Birds of a Feather Consume Sports T
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Session 1.2 How is Social Media, li
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2. Interviews made with the adminis
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Table-5 Facebook Members of Homeles
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content (UGC) or even direct intera
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Fierman, (1991) found that 47% of c
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Multiple Dimensions of Brand Identi
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Session 1.3 Corporate Identity, Cor
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CSR are the ideals and ethics of co
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Corporate Brand Identity Management
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To study the influence of B2B relat
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Antecedents And Consequences Of Bra
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22. Gurviez, P., and Korchia, M. (2
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Non-monetary factors, such as effor
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23. Holbrook, M.B. (2006). Consumpt
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Brand Extensions and Culture: The I
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avoidance tend to prefer more infor
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Virtual Internal Brand Communities:
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References 1. Algesheimer, R., Dhol
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associations based on their percept
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shift in the psychological contract
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10. Berthon, P., Ewing, M., & Hah,
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Session 2.1 Global Brand Relationsh
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G. Brand Personality Excitement Hon
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The Impact of Relationship Marketin
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‗United 2010-one for all, all for
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Brand Equity Trends in Top Global B
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Uncovering ‗Meanings‘ through A
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45. Melewar, T.C. and Saunders, J.
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Thus, from a design perspective, we
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Keywords Brands, marketing, meaning
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How Important is the Brand Name Ele
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References 1. Aaker, D. (1991). Man
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Simon Cowell and Branding the X Fac
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Dead or Living: Which Celebrity To
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Reference 1. Bagozzi, R.P. & Yi, Y.
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has been adopted and within this an
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Organizational Factors Contributing
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examine and reconcile existing lite
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Effects of Corporate Social Respons
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15. Morsing M, & Schultz M. (2006).
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1989). But if the information avail
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An Inquiry into Corporate Heritage
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3. Balmer, J. M. T., & Greyser, S.
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Research questions and methodology
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Building Corporate Reputation: A Di
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Session 3.1 Financial vs. Consumer-
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For indicating brand equity, one of
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Financial Brand Valuation: an exper
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Figure 1 Religiously Motivated Cons
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I Don‘t Like It! - Understanding
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Session 3.2 Advertising Agency Empl
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applications of the Repertory Test
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The Life Cycle of Mavens Lynne Free
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Exploring the relationship between
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internal branding process. Internal
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proper branding strategy. With the
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Profiling the Image of Urban Busine
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Finally, the paper confirms the cau
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Table 3 Image differences according
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associated with the brand‖ (Aaker
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Figure 1 - Number of adjectives sel
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Figure 5 - Main attributes of a gol
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Empirical Studies For both studies,
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Figure 2: Perception of the City of
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Co-branding places? Andrea Lucarell
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12. Lucarelli, A., & Berg, P. O. (2
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the place brands, as has been showe
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Session 3.4 Innovation and Entrepre
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The interviews were conducted in th
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Country-of-Origin Effects on Brand
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7. Kaynak, E., Kucukemiroglu, O. &
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Results The demographic profile ind
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use games consoles (Childwise, 2001
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Plenary Session 2 Brand Performance
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Uncles, M.D. & Kwok, S. (2008). Gen
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Brand Management Framework Empirica
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Coneptualising Branding in Indian P
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characteristics could be zeroed upo
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Concentrating on the actual practic
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ooking attractive in greater detail
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Session 7.2 Brand Personification a
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Importance of Country Image to Mega
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Table 1: Evaluative Responses for t
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To be Similar or Unique? Implicatio
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Brown, T. J., Dacin, P. A., Pratt,
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A brand-driven strategy oriented to
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Rheingold, H. (1993). The Virtual C
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A Framework for Public Sector Brand
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Conclusion Public sector organisati
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A strategic investigation into the
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There are also some changes in term
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Brand Hypocrisy Sanne Frandsen, Cop
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Page 203 and 204: When Individual Experience becomes
Page 205 and 206: Impact of Storytelling on Consumer
Page 207 and 208: The Role of Communication in Establ
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Page 213 and 214: Analysis and results We assessed th
Page 215 and 216: An Exploration of Own Brand Retaile
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Page 231 and 232: Segmenting McDonalds: Measuring Bra
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Page 237 and 238: Session 8.3 Brand Attitudes and the
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Page 245 and 246: Exploring differences in product at
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Page 251 and 252: Sonic branding: A review of literat
Page 253 and 254: How is green seen? Exploring the im
Page 255 and 256: were in evidence. The inability to
Page 257 and 258: Generally speaking, people use exte
Page 259 and 260: How Retail Banks Use Atmosphere to
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Page 263 and 264: Introduction Reputation and Financi
Page 265 and 266: Chun, R. & Davies G. (2009). Employ
Page 267 and 268: Identity, Reputation and Organizati
Page 269 and 270: Introduction Factors Affecting Bran
Page 271 and 272: A quiet important approach then bec
Page 273 and 274: 27. Gentry, C.R., ―Building on Br
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Page 277 and 278: elations. If the contact persons tr
Page 279 and 280: How do you Really Know? Exploring B
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Page 293 and 294: A Competance based Brand: Meaning a
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Leonor Vacas de Carvalho, Évora Un
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Ronaldo Schutz, University of the A
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