Private labels in foods : consumer choices between private labels and national brands : investigating the effects of category complexity, social consumption and perceived risk

Abstract

The purpose of this thesis was to investigate the effects of social consumption, category complexity and perceived risk on consumer choices between private labels and national brands in addition to studying the potential effects from social consumption and category complexity on perceived risk. Moreover, lack of current research on private labels in Norway further influenced the decision of studying the subject in this market. Hence, the study is aiming at contributing to understanding consumer choices in the context of the Norwegian grocery market and consumer culture. The mentioned effects were studied through the use of an online survey with a selfselection sample consisting of 148 respondents after data cleaning. Further, the study includes grocery products, specifically from product categories within foods: frozen pizza, shrimp salad spread, canned tomatoes and jasmine rice. Each product category in the study was presented in the form of a product pair consisting of one private label product alongside one national brand product. The largest Norwegian retail owners - REMA 1000, COOP and Norgesgruppen - were represented through their private labels. The main findings reveal both category complexity and perceived risk as factors contributing to increase the choices of national brands as compared to private labels. Social consumption was found to increase preferences towards private labels - a finding which is hypothesized to potentially be both unique to the Norwegian culture and the least confident result of the study. The effect from social consumption on perceived risk was not significant. However, category complexity is found to increase perceived risk amongst consumers. Keywords- private labels, store brands, national brands, consumer choices, consumer preferences, perceived risk, social consumption, category complexity