Name Brand vs. Store Brand

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In the articles we reviewed, we examined the primary motivating factor for choosing name brand products over store brand products. Our hypothesis stated that amongst a sample of graduate school students, name brand products would be chosen over store brand products because of their aesthetically pleasing qualities and familiarity. Many of us have been in this scenario: we’re in the canned food aisle at our local Ralph’s, and we scan the shelves to see Dole canned corn and Ralph’s canned corn. Notably, the store brand is $1.25 cheaper. Yet, how many of us reach for the Dole brand? Why do we do it? Method Discussion Name Brand vs. Store Brand Janae Kim, Meghan McMonigle, Rachelle Monson Azusa Pacific University Chart I Chart II References Literature Review Results In this study, students and family members ranging from ages 23-55 participated in the completion of the survey. The graduate students were all individuals enrolled in a graduate program at Azusa Pacific University, while the family members were those related to the individuals conducting the research. A total of 20 respondents completed the online survey. SurveyMonkey provided a response summary that facilitated the accurate analysis of results. The answers provided by these participants did not fully corroborate our hypothesis that name brand products are favored over store brand products. There were several results that appeared noteworthy. In this study, we hypothesized that when individuals are given the choice between purchasing a brand name product or a private label product, individuals are more likely to purchase the brand name product due to familiarity. To conduct this study we took a sample from the Azusa Pacific University Psychology graduate program and from various family members. Brand appeal (sales of private-label products decline during holiday periods). (1995). Canadian Grocer, 108 (4), 7. Retrieved from http://search.proquest.. Com/docview/222859104?Accountid=8459

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Literature Review By Rachelle Monson In the articles we reviewed, we examined the primary motivating factor for choosing name brand products over store brand products. Our hypothesis stated that amongst a sample of graduate school students, name brand products would be chosen over store brand products because of their aesthetically pleasing qualities and familiarity. Many of us have been in this scenario: we’re in the canned food aisle at our local Ralph’s, and we scan the shelves to see Dole canned corn and Ralph’s canned corn. Notably, the store brand is $1.25 cheaper. Yet, how many of us reach for the Dole brand? Why do we do it? And if we choose the store brand product, what factors contribute to the decision? Interestingly, the articles we reviewed provided quite a holistic picture on the various competing perspectives in the war between name brand products and store brand products. Private labels have long been saddled with the reputation for being cheap, lower-quality alternatives to name brand products (Mollenkamp, 2008). Moreover, many customers seem to have an emotional attachment to certain name brands when it comes to a specific product category. According to one of the articles we reviewed, many shoppers have been forced to choose store-brand products because of the recent economic pressures. However, some retail researchers are confident that shoppers will return to their name-brand products, as various private label products didn’t seem to meet the acceptable replacement standards as anticipated (Chang, 2009).

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It also appears that depending on the product choice, some shoppers prefer name brand products to store brand. For example, in a recent study, participants noted that despite the cost of store brand products, customers were not willing to entrust their hair, complexion, and dental health to store brands (Shapiro, 1993). Interestingly, a similar study discovered that while 8 in 10 shoppers would try new food products, only 5 in 10 would purchase new beauty products (PR Newswire, 2011). Another article examined customer preferences related to entertaining, and discovered shoppers prefer to buy brand name hot dogs, soft drinks, potato chips, and cookies when entertaining (Canadian Grocer, 1995). Even more compelling is that despite the rise in demand for store brands, their reputation for falling behind in quality, particularly when compared to their name brand counterparts, has apparently been maintained by poor appearance of the packaging and lack of an attractive brand image (Field, J. R., Bergiel, B. J., Giesen, J. M., & Fields, C. L., 2009). However, not all of the research we found gave private labels a bad rap. In a recent supermarket survey by Brandweek, researchers discovered that 70 percent of customers were highly satisfied with the quality of store brands they had bought in the past year (Fleenor, 2009). It is no surprise then that a recent Wall Street Journal article explored how various brand name company chains are working with retailers to create special displays that allow name brands and their store brands to share the promotional spotlight (Jargon & Zimmerman, 2009). Perhaps one of the best examples of this type of promotional spotlight is Costco. Although Costco carries a variety of name brand products in their stores, Costco’s private label appeals to many shoppers. A recent study explored how Costco’s private brand encourages store loyalty by utilizing the method of exclusive membership, attached with rewards for Costco’s private label, which helps develop strong bonds with customers. What’s more, Costco has been especially successful in their model by offering products to their members with lower prices and higher quality than other retailing channels (Hu & Chuang, 2009).

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It appears that another emerging leader in the private label field, other than Costco, is Target. A recent study in the Wall Street Journal examined Target’s clever and sophisticated tactics of attracting customers to their Archer Farms brand. Interestingly, the article noted that Target focuses not only on higher quality, but also on offering a creative label such that buyers will not even notice that is actually a generic brand (Zimmerman, Kesmodel, & Jargon, 2007). It appears that the success Archer Farms has experienced is largely due to the investment the company has made to create packaging styles that are aesthetically pleasing to its customers. Additionally, the study noted increasing shelf space for such aesthetically pleasing products is a huge contributing factor to the boost of sales in this private label (Zimmerman et al, 2007). It appears there is also, at times, a negative connotation to private-labels and those of lower socio-economic status. However, according to a recent study, 78% of both lower and higher-income consumers believe private label products are typically of excellent quality (Professional Services Close-Up, 2009). The study also noted that in 2009, private label dollar share had increased in 13 of 15 categories, including natural cheese, butter, and canned vegetables. The article also stated that refrigerated goods including eggs, milk, and frozen seafood were following in the private label categories (2009).

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Perhaps most notably, when it comes to the taste of private label products, brand names don’t necessarily guarantee the best flavor. In a recent blind taste test among consumers, private-label Safeway pasta sauce beat out Prego pasta sauce 19 times out of the 29 surveys conducted (Consumer Reports, 2009). The article also explored that despite the economic pressures, and the increase of sales associated with generic products during hard times, “store brands are here to stay” (2009). In fact, the study also stated that over the past few years, the placement of private labels on shelves, better packaging, more promotion, and higher manufacturing standards all contributed to private labels making their mark with consumers (2009).

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Method By Meghan McMonigle Participants In this study, students and family members ranging from ages 23-55 participated in the completion of the survey. The graduate students were all individuals enrolled in a graduate program at Azusa Pacific University, while the family members were those related to the individuals conducting the research. Race, gender, age, and degree subject were in no way used as discriminating factors and were not even asked of the individuals throughout the process. The participants were notified about the purpose of the study and were given the choice to withdraw from the study at any time, if needed. Of the individuals asked to complete the survey, 20 chose to participate. Instruments Throughout the duration of the research project, a blog was used to allow each group member the opportunity to communicate and discuss the project amongst one another. Various assignments and activities required by Azusa Pacific University’s Research Methodology eCourse were then posted to this site to allow each individual the opportunity to look at components of the study and to explore aspects of the assignment. After utilizing this site to come up with a research question and ideas about the topic, another site was then used to help complete the survey process. To create, conduct, and collect the data needed for the study, survey monkey (surveymonkey.com), an online survey website, was used to create the questionnaire for the participants. A 10-question survey was designed and then attached to an e-mail along with the purpose for the survey and the IRB authorization to give individuals the opportunity to take the survey. By utilizing survey monkey individuals were able to anonymously submit their responses and then the data was calculated based on their responses.

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Procedure To begin the research study our group was first asked to develop a hypothesis based off of an interest. Several different topics were developed and then one was chosen as the research topic. This hypothesis was then submitted to our professor for approval to ensure that the Institutional Review Board (IRB) at APU would not need to get involved with the study. Once the topic was confirmed we were able to begin to develop questions for the survey. Through various reviews from peers and our professor 10 questions were then revised and chosen for the survey. Once the survey was constructed we were then required to submit the survey and various other information pieces to OIRA for approval. Reyna Guzman, an employee at the Office of Institutional Research and Assessment then approved our survey and provided us with a header to attach to the e-mails we sent out to our participants in March. Within that e-mail individuals were made aware of informed consent and were notified of their rights to stop the survey at any time. Once this was read and the participants agreed to complete the survey they then clicked on the link provided and proceeded with the various multiple choice, Likert scale, and open ended questions. Upon completing the survey each individual then submitted his or her answers anonymously through survey monkey. Once our participants completed the surveys, we were then able to look at the results and begin to analyze and understand the results.

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Results By Janae Kim A total of 20 respondents completed the online survey. SurveyMonkey provided a response summary that facilitated the accurate analysis of results. The answers provided by these participants did not fully corroborate our hypothesis that name brand products are favored over store brand products. There were several results that appeared noteworthy. First of all, as Chart I displays, only 7 of them agreed with the statement, “Name brand products are of higher quality than other brands,” while another 9 disagreed and the rest remained neutral ( M = 2.95, SD = 1.00). The view that store brand products fall behind in quality is further challenged by the subsequent chart, which shows that 16 participants disagreed or strongly disagreed with the statement, “It is difficult to find satisfactory, high-quality store brand products” ( M = 2.15, SD = 0.67). As indicated by the lower standard deviation in this question, the respondents answered similarly. The question that had the lowest standard deviation ( SD = 0.38) pertained to the accessibility of store brand products among many name brand products on display ( Chart III ). With 15 subjects disagreeing with this claim ( M = 2.17), the implication seems to be that store brand products are no longer under the shadow of the leading name brands and are rising out of their former negative reputation. In regards to our focus on the importance of the design of the product packaging, the subjects were evenly divided, as shown in Chart IV .

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Chart V shows the results involving the element of familiarity as a factor in choosing between name brand product and store brand product. Although there were various responses for this question, 13 participants agreed or strongly agreed that they are in fact more likely, if pressured for time, to incline towards a name brand product due to its familiarity ( M = 3.60, SD = 1.10). Much insight and knowledge also came from the free-response section of our survey. In response to the question, “What is most important to you when you are buying a product?” 17 respondents mentioned price and/or quality. As for their opinion on name brand and store brand products, some of the most notable answers include, “I think the current economic climate has pushed more consumers toward black label products (store brands), and they have come to find that these products are 'just as good' as the name brands they formerly paid premium prices for,” “Store brands still need some work, but they are slowly building credibility and I see in the future where it will be difficult to distinguish store brands versus name brand products,” and “Some store brand products come from the same factory as name brand and are just labeled differently, and others really are worth the little money you pay.”

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Chart I

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Chart II

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Chart III

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Chart IV

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Chart V

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Table

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Discussion By Meghan McMonigle In this study, we hypothesized that when individuals are given the choice between purchasing a brand name product or a private label product, individuals are more likely to purchase the brand name product due to familiarity. To conduct this study we took a sample from the Azusa Pacific University Psychology graduate program and from various family members. From the data collected it was apparent that most individuals did not appear to show a bias towards brand name products like we had hypothesized. When asked whether they felt name brand products were of a higher quality than store brands only 6 of the 20 participants agreed with the statement and 10 of the 20 disagreed or strongly disagreed with the statement. The results and responses from our participants went against what we thought individual’s opinions of store brand versus brand name products actually were. Recognizing this, this information could be generalized to a bigger population if our sample was an adequate representation of the population, however because we only used a sample size of 20 people, the study does not have an adequate representation to make such generalizations about the graduate student and family populations. For this reason, another study involving much larger sample sizes would need to be obtained in order to apply the findings to the general population.

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The method (e-mail) in which we asked individuals to participate in the study may have caused only certain individuals to participate (such as those responsible to check their e-mail regularly or those with immediate access to a computer). For this reason, the results of the survey may have been altered simply by the types of individuals who chose to take the questionnaire. This process of distributing the survey could have easily limited the feedback we received as well as the inability to ask extensive questions about the topic. Due to survey monkeys 10 question limit, we were only able to ask a limited set of questions. This greatly restricted the amount of information we could gather. Asking more questions would have given us a much more precise picture of our participants opinions in regards to name brand and store brand products. Therefore, in order to make this study more generalizeable to the public, a great number of participants would need to be used as well as a lengthier survey to ensure that enough information had been collected from each individual. In reviewing our study, we feel that this topic of name brand and store brand products continues to be relevant because of the current economic struggles many individuals are experiencing, Due to budgets and individuals trying to save money it has become important for individuals to look at the price of various items in stores and really become conscientious of which items they are choosing. For this reason the differences between name brand and store brand products have become very important when deciding whether to choose an item for quality, packaging, or price. We feel that continuing to research on this area could provide retailers and consumers with a lot of helpful information as to the differences and similarities of the two different types of product. By continuing further research on this topic, much could be learned about brand name versus store products and people could continue to be educated on ways in which to save money while continuing to receive great quality in their choices.

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References Brand appeal (sales of private-label products decline during holiday periods). (1995). Canadian Grocer, 108 (4), 7. Retrieved from http://search.proquest.com/docview/222859104?Accountid =8459 Chang, A. (2009, March 30). Store v. name brands: should you go generic?. Main St. , Retrieved from http://www.mainstreet.com/article/smart-spending/bargains/deals/store-v-name-brands-should-you-go-generic Field, J. R., Bergiel, B. J., Giesen, J. M., & Fields, C. L. (2009). Effects of branding on taste perceptions. Competition Forum, 7 (2), 325. Retrieved from http://search.proquest.com/docview/214846737?accountid=8459 Fleenor, G. (2009, October 30). National brands vs. private label. Brandweek, Retrieved from http://www.brandweek.com/bw/content_display/news-and-features/packaged-goods/e3i148e1ece59e598654a320fed28f4f981 Hu, F. L., & Chuang, C. C. (2009). How can different brand strategies lead to retailers' success? comparing manufacturers brand for coca-cola and private brand for costco. Journal of Global Business Issues, 3 (1), 129. Retrieved from http://search.proquest.com/docview/223740994?accountid=8459 IRI survey takes a look at the private label threat. (2009). Professional Services Close - Up, n/a. Retrieved from http://search.proquest.com/docview/818433096?accountid=8459 It pays to buy store brands. (2009, October). Consumer Reports , Retrieved from http://www.consumerreports.org/cro/magazine-archive/october-2009/shopping/buying-store-brands/overview/buying-store-brands-ov.htm Jargon, J., & Zimmerman, A. (2009) Brand-name food makers, private labels share stage. Wall Street Journal, pp. B.1. Retrieved from http://search.proquest.com/docview/399053457?accountid=8459 Mollenkamp, B. (2008, April). Private labels grow in quality and demand. Sanitary Maintenance , Retrieved from http://www.cleanlink.com/sm/article.asp?id=8628&keywords=private Shapiro, B. E. (1993, Price lure of private-label products fails to hook many buyers of baby food, beer. Wall Street Journal, pp. PAGEB.1. Retrieved from http://search.proquest.com/docview / 398376700?accountid=8459 Top consumer trends revealed in third annual BrandSpark and better homes and gardens american shopper study: Over 63,000 american shoppers and over 100,000 consumers across north america expose their eating, shopping & beauty habits in north america's largest shopper study. (2011). PR Newswire, n/a. Retrieved from http://search.proquest.com/docview/851496773?accountid=8459 Zimmerman, A., Kesmodel, D. and Jargon, J. (2007) From cheap stand-in to shelf star; food retailers put spotlight on store-brand products, to dismay of sara lee, kraft. Wall Street Journal, pp. B.1. Retrieved from http://search.proquest.com/docview/399085173?accountid=8459