Expert quality evaluation and price of store vs. manufacturer brands: An analysis of the Spanish mass market

Abstract

This study compares manufacturer and store brands in terms of their objective quality as well as their price differentials for products in the food and drink, personal hygiene and home cleaning markets over the period 1989–2004. The results of descriptive and multivariate techniques suggest a positive evolution in the quality of store brands. We do not find differences in objective quality between manufacturer and store brands. But we do discern differences in the objective quality of store brands with respect to national and local manufacturer brands for a limited range of product categories. Specifically, quality is significantly higher for manufacturer brands (especially national ones) in technologically more complex categories. With regard to price, the differences favor store brands. Approval of a store's own brand is higher when the average prices for the category are lower. Furthermore, higher price differentials do not always increase the market share of a store brand. These findings have interesting implications for manufacturers and retailers in the management of their brand portfolio.