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Effects of intra-brand competition between private labels and manufacturer brands: Empirical results from the Italian market

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Abstract:

A proliferation of private labels in European food retailing has been evident for several years now. The purpose of this study is to analyze the impact of competition between manufacturer brands and private labels on assortment and pricing practices by Italian grocery retailers. Previous studies emphasized both pro-competitive and anti-competitive effects of private label development. In this study, within an empirical analysis based on scanner data from Symphony IRI Group, all fast moving consumer goods product categories are investigated over a period of two years (from September 2008 to September 2010). The empirical results indicate that in Italy there is no clear and strong evidence of decreases in manufacturer brands' assortments, prices, and turnover caused by a proliferation of private labels. In particular, analyzing at the same time all categories and all retailers' data in the Italian Market there is not much evidence for the existence of a strategic trade-off between manufacturer's and retailer's brands.

Keywords: assortment range; intra-brand competition; modern grocery distribution; pricing strategies; private labels

Document Type: Research Article

DOI: http://dx.doi.org/10.1080/09593969.2011.620132

Affiliations: Facoltà di Economia,Università degli Studi di Parma, Parma, Italy

Publication date: December 1, 2011

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