Understanding consumers’ perceptions of competitive tiers—can perceived risk help?

Abstract

A review is presented showing the increasing power of multiple grocery retailers from which an argument is developed questioning whether consumers perceive packaged grocery product fields in terms of brands versus own labels versus generics. Consumers’ perceptions of risk are reduced through information search and it is thought that the different search activities between the high and low risk perceivers may explain perceptions of the competitive structure of product fields. For six packaged grocery fields, separately, qualitative research was undertaken to elicit the dimensions consumers use to evaluate competing items. Data was then collected from 829 householders and was subsequently subjected to cluster analysis. Consumers’ perceptions of the competitive structure of product fields differed from marketers’ expectations and brands were always perceived as being distinct from retailer labels. The result did not appear to be influenced by consumers’ perceptions of risk. Reasons for the result are considered, and managerial implications explored.