TY - GEN
T1 - The market power of private
labels - retailer's brand and industry effect
AU - Matos, Pedro Verga
AU - Vale, Rita Coelho do
PY - 2015
Y1 - 2015
N2 - In the rapidly changing international business environment of today, a company’s brand can be the key feature for a retailer to distinguish itself from other competitors and to compete with manufacturers. In fact, the dynamics of competition between these players and private labels (PL) brand power can be an important element. The main purpose of this research is to measure and explain the PL’s market power across different retailers and categories through the use of the price’s differential between national brands (NB) and PLs, using a proxy for an Lerner’s index (L) of each category.,. Assuming a Cournot behavior of oligopoly’ competitors, L=H/ε (H = Herfindahl concentration index and ε= elasticity of demand), the retailer market power depends simultaneously of supply characteristics (concentration) and demand characteristics (elasticity). The logic beyond this approach is that the higher the consumer’s satisfaction and brand awareness of a product related to a brand, the higher the consumer’s willingness to pay. As the willingness to pay to a PL product increases, the differential between NBs product and PLs decreases, implying a higher PL market power.
AB - In the rapidly changing international business environment of today, a company’s brand can be the key feature for a retailer to distinguish itself from other competitors and to compete with manufacturers. In fact, the dynamics of competition between these players and private labels (PL) brand power can be an important element. The main purpose of this research is to measure and explain the PL’s market power across different retailers and categories through the use of the price’s differential between national brands (NB) and PLs, using a proxy for an Lerner’s index (L) of each category.,. Assuming a Cournot behavior of oligopoly’ competitors, L=H/ε (H = Herfindahl concentration index and ε= elasticity of demand), the retailer market power depends simultaneously of supply characteristics (concentration) and demand characteristics (elasticity). The logic beyond this approach is that the higher the consumer’s satisfaction and brand awareness of a product related to a brand, the higher the consumer’s willingness to pay. As the willingness to pay to a PL product increases, the differential between NBs product and PLs decreases, implying a higher PL market power.
U2 - 10.1007/978-3-319-10912-1_42
DO - 10.1007/978-3-319-10912-1_42
M3 - Conference contribution
SN - 9783319109114
T3 - Developments in Marketing Science
SP - 136
EP - 136
BT - Marketing Dynamism & Sustainability-Things Change, Things Stay the Same...
A2 - Robinson, L.
PB - Academy of Marketing Science
T2 - Marketing Dynamism & Sustainability: Things Change, Things Stay the Same...
Y2 - 15 May 2012 through 20 May 2012
ER -