Factors Influencing Customer Perceived Quality and Purchase Intention toward Private Labels in the Vietnam Market: The Moderating Effects of Store Image

Thuy T.N Vo,Chi T.K Nguyen

doi:10.5539/ijms.v7n4p51

Abstract

This study aims to investigate how financial risk, performance risk, physical risk, store image and familiarity affect perceived quality and customer purchase intention toward private labels in Vietnamese context. Moreover, the moderating effects of store image are measured to gain deep knowledge into this proneness. The research model is designed to test in Ho Chi Minh City with 380 participants and collected data is analyzed by SEM method. The results indicate that performance risk, physical risk and store image significantly influence perceived quality. In addition, performance risk, physical risk and store image have indirect effect on purchase intention through perceived quality while only direct effect of familiarity on purchase intention is proved. Interestingly, the role of store image, which moderates the relationship between performance risk, physical risk and perceived quality, is strongly determined. Hence, store image is considered as a symbol of quality and risk reducer. From these findings, the research is expected to provide useful reference for retailers and marketers to come up with effective solutions associated with private labels. Lastly, this research still contains some limitations including sample size, product category and measurement scale, which need to be improved by further research.

Highlights

1.1 Research BackgroundThe harsh competition in retailing market forces companies to have competitive strategies in order to differentiate their products from others rivals, achieve customers’ loyalty and gain long-term profit
Based on previous studies and the research of Sheau-Fen et al (2012), in this paper we develop a framework to measure the effects of consumer perceived risks on perceived quality and customer purchase intention toward private labels in Vietnamese market and the moderating effects of store image on these relationships
The findings presented that performance risk, physical risk and store image had significant influences on purchase intention through perceived quality at p < 0.05 and p < 0.01

Summary

Introduction

1.1 Research BackgroundThe harsh competition in retailing market forces companies to have competitive strategies in order to differentiate their products from others rivals, achieve customers’ loyalty and gain long-term profit. Most consumers gradually change their shopping habits due to the pressure of unfavorable economic condition and the increase of living costs. They become more sensitive to prices these days. While the shoppers try to spend less money purchasing, they still tend to seek higher quality from the products To deal with these difficulties, retailers globally start to produce products their own brand and only sell them in their stores. These products are perceived as private labels. In Asia Pacific, the Middle East and Africa these products are perceived negatively (2013)

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