Brands, retailers and consumers

Date of publication: September 1, 1997

Abstract:

Within Britain the dominance of leading supermarket chains continues to grow, as does the market share of own label brands. A new study shows generally favourable consumer attitudes towards these products. As a result, premium brands are widely perceived as being an endangered species. Evidence is presented, however, to demonstrate that even under direct attack from own label, either in the form of competitive sub-brands or massive price cutting, leading premium brands continue to display strength and resilience. The basis of this strength is discussed, and the outcome appears to be that excessive price competition from own label harms retailers at least as much as premium brand manufacturers. This explains why the relationship between the leading supermarkets and brand manufacturers has recently appeared less combative and more co-operative. This may be linked to shifts in shopping as supermarkets widen operations and new technology opens prospects of interactive home shopping.

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