How Private Labels Affect Consumer Choice

Abstract

The role of private labels in consumer choice is studied by considering two issues: do private labels affect the way people buy within a store, and do they affect the way people choose between stores? The revealed behaviour of consumers is studied, both descriptively and using a very general model of behaviour, the Dirichlet. Some examples are presented which show that within a store, the way consumers buy private labels is similar to the way they buy brands, and that for the buying of a product at different stores, consumers patronise stores with private labels in much the same way as stores without them.