The impacts of comparative ads used by retailers to compare their store brands with national brands

Abstract

PurposeThe research aim is to investigate the impacts of comparative ads used by retailers to compare the prices of their store brand (SB) products with those of equivalent national brand (NB) products. More specifically, this research examines if consumers perceive retailers as legitimate when they use comparative ads to compare the prices of their SB products to those of equivalent NB products, and how effective are these comparative ads in terms of actual purchases. This research also explores for which SB type (economy, standard or premium) and consumers are comparative ads most effective.Design/methodology/approachThis research investigates consumers' reactions to comparative ads used by retailers to compare the prices of their SB products with those of similar NB products through an experiment within a store laboratory. A between-subject design has been used. The participants of the first/second/third group (n1 = 93/n2 = 92/n3 = 91) were exposed to ads comparing the prices of retailer's economy/standard/premium SB food products with their equivalent NB food products, in the same product category. The participants of each group carried out a shopping trip in the store laboratory.FindingsConsumers consider retailers legitimate when they use comparative ads. This favourable evaluation improves their attitude towards these ads. However, the impact of retailers' legitimacy of (1) means, (2) objectives and (3) historical legitimacy on consumers' attitude towards comparative ads depends on the SB type (economy, standard and premium). By contrast, comparative ads are effective in terms of consumers' attitude towards these ads and towards SBs, along with purchase intention and actual purchases of these brands, whatever the SB type. Lastly, this research highlights that comparative ads for SBs are mainly directed at consumers with high levels of price consciousness and resistance to NBs.Research limitations/implicationsThis research only tested the impact of direct comparative advertising and an extrinsic attribute (price). The research experiment was conducted on a convenience sample, which limits its external validity.Practical implicationsThis research encourages retailers to use comparative advertising for their SBs (economy, standard and premium) for several reasons. First, this study suggests that comparative advertising is an effective tool for retailers to shape or improve consumers' attitude towards SBs, via their attitude towards comparative ads. Second, this research proposes that comparative advertising contrasting the prices of SB products with those of NB products could increase retailers' in-store sales of their SBs. Lastly, this research underlines that comparative advertising is particularly effective for consumers with high levels of price consciousness and resistance to NBs.Originality/valueThis research supplements previous research in the field of SBs and comparative advertising. Previous research on comparative advertising has examined NBs exclusively (Dianoux et al., 2013; Beard, 2018). Comparisons between SBs and NBs are lacking. This research thus validates the use of this specific form of communication for SBs, given the paucity of studies of the effects of the use of mass media communication on SBs (Nenycz-Thiel and Romaniuk, 2014; Gendel-Guterman and Levy, 2017).