Structured Abstract: The Influence of Dual Branding Information on Consumer Evaluations

Abstract

Retailers increasingly utilize private label branding strategy in an effort to simultaneously increase store loyalty and compete with national brands (Ailawadi and Keller 2004; Nies and Natter 2012). Previous research suggests consumers are not only receptive to the notion of private label consumption but in many cases prefer retailer brands over their premium brand competitors (Neilsen 2011; Thomassen et al. 2006). From a supply perspective, many national brand manufacturers, or “dual branders” (ter Braak et al. 2013: 87), produce private label brands to optimize outcomes from the channel relationship (Chen et al. 2010; Kumar et al. 2010). Dual branders do not volunteer this information to prevent loss of the national brand market share due to narrowing gaps between quality perceptions of premiums and private labels (Sethuraman and Raju 2012; Steenkamp et al. 2010). Consequently, consumers are often only able to rely on superficial signals (e.g., packaging or price) to evaluate the origins and quality of private-label products. However, consumers can be inadvertently exposed to dual branding knowledge through other communications such as a manufacturer’s announced product recall or word-of-mouth from others. Thus it is important for marketing researchers to understand how consumers react to the knowledge that two differently priced, competing brands are sourced by the same manufacturer. In response, this research examines the influence of dual branding on customers’ respective brand evaluations through the mechanism of their comparative quality perceptions. Results of the analyses suggest that exposure to dual branding does influence consumers’ comparative quality perceptions between competing private and premium brands, which in turn significantly impacts respective brand evaluations. Specifically, comparative quality perceptions facilitate the indirect effects of dual branding information, which positively (negatively) influences private (national) label evaluations.