THE POWER OF PRIVATE BRANDS
Abstract
National brands are well-known and popular brands of manufacturers, such as Coca Cola, McDonald's, Milka, Maggi, Colgate, Toblerone, Evian, Knorr, etc. These brands usually are well accepted and favorites of consumers. They associate with high quality, availability, feelings, experiences, promotions, and events. However, their popularity is increasingly threatened by private brands. Private brands are brands of retailers and distributors, that starting from the 14th century, and especially today, have conquered lots of consumers. Initially, private brands appeared among consumer goods (food products) and were without name, style, design, with relatively low quality and with much lower prices than national brands.Economic crises, low living standard, poverty that existed in several countries in the middle of the XIX-th century caused the consumers to become more sensitive to prices, and they began to show interest in private brands. The greater demand for these products the richer became the retailers. Retailehad a great advantage: they knew the needs and wants of consumers. With time, retailers have invested more in quality, taste, packaging, design, style, and colors of their brands that have attracted more customers. Today, private brands represent a severe competitive threat to national brands. Some recent research shows that private brands are more popular and more required than national brands. This paper aims to reveal the future of national and private brands with the help of empirical research.
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