Governance of private label as a strategic asset: developing a brand valuation model

Abstract

This paper aims at identifying which factors should be considered in the building of an economic evaluation model for the private label brand. In fact, some specific characteristics of private label, with respect to industrial brand, make unusable the consolidated models available. The results of the paper are the definition of some specific factors of private label, the assumptions about how these features impact on the traditional economic evaluation models and how these could be included in a model. Because of the complexity of the topic, the hypothesis is to build a model of synthesis, made of two parts: one part for a Financial-Based evaluation of Brand Equity, with the addition of some specific factors and indicators to the traditional formulas, while the other part is for a Consumer-based evaluation of Brand Equity, thanks to an index that summarizes the strength of private label brands from the consumer perspective. The private label economic evaluation has some relevant managerial implications on the retail system, on the vertical supply chain relationships and on the understanding of the strategic nature of this asset.