An Empirical Investigation into the Factors Influencing Consumer Perceptions of the No Name Brand Food Items: Special Focus - South Africa
©2004
Masterarbeit
93 Seiten
Zusammenfassung
Inhaltsangabe:Introduction:
In todays complex business environment, doing business is no longer business as usual; it has evolved into quick change, quick response, and quick results. In such an environment it is only those business enterprises which understand these trends and position themselves for tomorrow can survive and grow successfully. Nowhere is this reality truer than in the retail industry, where changes on the consumer side are creating new challenges and opportunities at a frantic pace.
In the past, the consumers demand for high-profile brands let a retailer capitalize on the foundation of those solid, reputable brands to build its own reputation. This brand centric- approach to retailing meant strong competition, which has resulted in tight profit even to the bigger players of the industry. In response to the increased challenges, there has been a significant movement by most prominent retailers towards store brand solutions to improve margins and better meet the changing needs of the consumer. By creating high-quality product tied to the retailers own brand, retailers are reaping the benefits of brand loyalty for themselves. Leading global retailers like Wal-Mart, Aldi, Asda, Marks & Spencer, Migros, Tesco, Loblaw and many others now have two or three store brands, which allow for appeal across a wider variety of price points. According to recent studies, in Europe, store brands already represent over 45 Percent of the product mix, while in the U.S., store brands represent 25 percent (Internet 5).
Compared to the U.S and Europe, the South African market for store brands is not well developed and is far from being saturated. Store brands are sold throughout retailers in the country and categories are widespread - from beverages (milk, coffee, water, etc); including most confectionary categories; most household and toiletry categories; and from premium brands, to the more cost effective. Leading retailers like Spar, Shoprite, and Pick n Pay and others have various store brands. Even though South African retailers are utilizing own brands as a means of differentiation, some studies are also indicating the lack of well tuned major store brand strategies and own brands were not perceived as of value by consumers as well (Internet 2).
Like in the case of national brands, retailers brands have also evolved into many different forms (McGoldrick, 2002). The focus of this study is on the No Name Brand food items which are one form […]
In todays complex business environment, doing business is no longer business as usual; it has evolved into quick change, quick response, and quick results. In such an environment it is only those business enterprises which understand these trends and position themselves for tomorrow can survive and grow successfully. Nowhere is this reality truer than in the retail industry, where changes on the consumer side are creating new challenges and opportunities at a frantic pace.
In the past, the consumers demand for high-profile brands let a retailer capitalize on the foundation of those solid, reputable brands to build its own reputation. This brand centric- approach to retailing meant strong competition, which has resulted in tight profit even to the bigger players of the industry. In response to the increased challenges, there has been a significant movement by most prominent retailers towards store brand solutions to improve margins and better meet the changing needs of the consumer. By creating high-quality product tied to the retailers own brand, retailers are reaping the benefits of brand loyalty for themselves. Leading global retailers like Wal-Mart, Aldi, Asda, Marks & Spencer, Migros, Tesco, Loblaw and many others now have two or three store brands, which allow for appeal across a wider variety of price points. According to recent studies, in Europe, store brands already represent over 45 Percent of the product mix, while in the U.S., store brands represent 25 percent (Internet 5).
Compared to the U.S and Europe, the South African market for store brands is not well developed and is far from being saturated. Store brands are sold throughout retailers in the country and categories are widespread - from beverages (milk, coffee, water, etc); including most confectionary categories; most household and toiletry categories; and from premium brands, to the more cost effective. Leading retailers like Spar, Shoprite, and Pick n Pay and others have various store brands. Even though South African retailers are utilizing own brands as a means of differentiation, some studies are also indicating the lack of well tuned major store brand strategies and own brands were not perceived as of value by consumers as well (Internet 2).
Like in the case of national brands, retailers brands have also evolved into many different forms (McGoldrick, 2002). The focus of this study is on the No Name Brand food items which are one form […]
Leseprobe
Inhaltsverzeichnis
Aron Embaye
An Empirical Investigation into the Factors Influencing Consumer Perceptions of the No
Name Brand Food Items: Special Focus - South Africa
ISBN: 978-3-8366-4213-2
Herstellung: Diplomica® Verlag GmbH, Hamburg, 2010
Zugl. University of Kwa Zulu Nathal, Durban, Südafrika, MA-Thesis / Master, 2004
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3
DEDICATION
To My Beloved Parents:
My late father Embaye Ghebremariam Kassa&
My mother Akberet Negusse Weldemichael
Thank you for making me the man I am now.
4
ACKNOWLEDGEMENTS
I wish to express my gratitude to my supervisor Prof. Elza Thomson, for her valuable
comments and guidance throughout the work. She also deserves my warmest thanks for
providing me with the opportunity to work on this interesting topic.
I am grateful to my mother, late father and my brothers and sisters for the help, support and
love they have provided me through out my life. Their confidence on me has been a driving
force for my postgraduate studies.
Finally, I wish to express my deepest thanks to my fellow Eritrean and South African friends
for the support and encouragement they have given me during my MBA studies.
5
ABSTRACT
In South Africa, Store brands are sold throughout retailers in the country
and categories are widespread - from beverages (milk, coffee, water, etc);
including most confectionary categories; most household and toiletry
categories; and from premium brands, to the more cost effective. Compared
to the U.S and Europe, the South African market for store brands is not well
developed; however, there are still mega opportunities in the own brand
category, as the market is far from being saturated.
Even though South African retailers are utilizing own brands as a means of
differentiation, some studies are also indicating the lack of well tuned major
store brand strategies and own brands were not perceived as of value by
consumers as well. Therefore, this empirical study is undertaken to establish
a greater insight into consumer perceptions toward the No Name Brand food
items by investigating the influence of selected economic, psychosocial and
demographic variables.
Without a solid understanding of the consumer, the available growth
opportunities in the store brand category are likely to be missed. For
retailers to take advantage of the opportunities in the store brand category a
greater understanding of consumer behaviour is required. For that purpose,
relevant theories and concepts of consumer behaviour are included in the
literature review for the study.
6
Table of contents
Table of contents
Table of contents
Table of contents
Page
Chapter One Introduction
13
1.1 Introduction 13
1.2 Background for the Research 14
1.2.1 The Distinction between Manufacturer's and Retailer's Brands
14
1.2.2 Overview of Store Brands in other Countries versus South Africa 16
1.2.3 Risks and Benefits of Store Branding for Retailers 16
1.3 Motivation for the Research 19
1.4 Value of the Project 19
1.5 Problem Statement 20
1.5.1 Sub-Problem 20
1.6 Objectives of the Study 20
1.7 Research Hypothesis 20
1.8 Limitations of the Research 21
1.9 Structure of the Study 21
1.10 Summary 22
Chapter two: Consumer Decision Making
23
2.1 Introduction 23
2.2 the Decision Making Process 23
2.3 Individual Determinants of Behaviour 26
2.3.1 Psychological Factors 26
2.3.2 Personal Factors 27
2.4 Environmental Influences 28
2.4.1 Culture 28
2.4.2 Social Class 28
2.4.3 Reference Groups 29
2.5 Previous Studies on Store Brands 30
2.5.1 The Role of Consumer Socio-Economic Variables 31
2.5.2 The Role of Quality, Price and Promotion 31
2.5.2.1 Quality 32
2.5.2.2 Price 32
2.5.2.3 Feature and Display Promotion 33
2.6 Summary 33
7
Chapter 3: Research Methodology
35
3.1 Introduction 35
3.2 Research Design 35
3.3. Secondary Data 35
3.4 Sampling 35
3.4.1 Sample Population 36
3.4.2 Sample Size 36
3.4.3 Sampling Design 37
3.4.4 Complex Probability Sampling 37
3.4.5 Systematic Sampling 37
3.5 Administration 38
3.6 Questionnaire Design 38
3.7 Pilot Questionnaire 39
3.8 Data Analysis 39
3.8.1 Descriptive Statistics 39
3.8.2 Inferential Statistics 40
3.9 Validity and Reliability 41
3.9.1 Reliability 41
3.9.2 Validity 41
3.10 Summary 42
Chapter 4: Analysis of Results
43
4.1 Introduction 43
4.2 Sample Demographics 44
4.3 Descriptive Statistical Analysis 44
4.3.1 Consumers' Awareness and Usage Level of the No Name Brand food items 46
4.3.1.1 "I buy the No Name Brand food items" 47
4.3.1.2 "I include the No Name Brand food items in my shopping list" 48
4.3.1. 3 "I think of the No Name Brand food items only when
I see them in the store" 48
4.3.1.4 "Greater knowledge about the No Name Brand food items will
lead to greater use" 49
4.3.1.5 "Retailers should continue providing the No Name Brand food items" 50
4.3.2 consumer perception toward the Price and Quality of the No Name
Brand food items 50
4.3.2.1 "Buying No Name Brand food items save a lot of money" 40
4.3.2.2 "Buying No Name Brand food items provides a high quality product" 52
8
4.3.2.3 "Buying No Name Brand items requires a lot of planning before shopping" 53
4.3.2.4 "Buying No Name Brand food items requires a lot of searching in the store" 54
4.3.2.5 "Generally speaking the lower price of food items
indicates lower quality" 55
4.3.2.6 "No Name Brand food items are good substitutes to other food
items under national brands" 55
4.3.3 The influence of psychosocial factors on consumer perceptions
toward the No Name Brand food items 56
4.3.3.1 "Buying No Name Brand food items is something my family likes me to do" 57
43.3.2 "Buying No Name Brand food items is something people may look down upon" 58
4.3.3.3 Item 15: "I would not mind serving No Name Brand food items to my guests" 58
4.4 Inferential Statistical analysis 59
4.4.1 Chi-square test to determine the impact of Age, Education and Income
on consumer awareness and usage level of the No Name Brand food items 59
4.4.1.1 " I buy No Name Brand food items"- the impact of Age 60
4.4.1.2 " I buy No Name Brand food items"- the impact of Education 61
4.4.1.3 " I buy No Name Brand food items"- the impact of Income 62
4.4.2 Chi-square test to determine the impact of Age, Education and Income
on consumer perception toward the price and quality of the No Name
Brand food items 63
4.4.2.1 " Buying the No Name Brand food items saves a lot of money"
- the impact of Age 63
4.4.2.2 " Buying the No Name Brand food items saves a lot of money"
- the impact of Education 64
4.4.2.3 " Buying the No Name Brand food items saves a lot of money"
- the impact of Income 65
4.4.2.4 " Buying the No Name Brand food items provides a high quality product"
-the impact of Age 66
4.4.2.5 " Buying the No Name Brand food items provides a high quality product"
- the impact of Education 67
4.4.2.6 " Buying the No Name Brand food items provides a high quality product"
-the impact of Income 68
4.4.3 Chi-square test to determine the influence of Psychosocial Factors on
consumer perception toward the No Nam Brand food items 69
9
4.4.3.1. " Buying No Name Brand food Items is something people may look down upon"
- the impact of Age 70
4.4.3.2. " Buying No Name Brand food Items is something people may look down upon"
- the impact of Education 71
4.4.3.3. " Buying No Name Brand food Items is something people may look down upon"
- the impact of Income 72
4.4.4 Results of Hypothesis Testing 74
Chapter 5 - Summary and Discussion of the Findings
76
5.1 Introduction 76
5.2 Findings on consumer awareness and usage level of the No Name
Brand food items 77
5.3 Findings on consumer perception toward the price and quality of the No Name
Brand food items 77
5.4 Findings on the influence of psychosocial factors on consumer perception
toward the No Name Brand food items 77
5.5 Findings on the impact of Age, Education, Income On consumer perceptions
toward the No Name Brand food items 78
5.6 Summary 79
Chapter 6: Conclusion and Recommendations
80
6.1 Conclusion 80
6. 2 Recommendations 81
6.2.1 Product 81
6.2.2 Price 81
6.2.3 Promotion 82
6.3 Recommendations for Future Study 82
7. Bibliography 83
8. Appendices 87
10
LIST OF TABLES
Table 4.1 - Age Category of Respondents
44
Table 4.2 - Education Category of Respondents
45
Table 4.3 - Income Category of Respondents
45
Table 4.4 - Consumer awareness and usage level of the No Name Brand food items
46
Table 4.5 - Consumer perceptions on the price and quality of the No Name
Brand food items 51
Table 4.6 - The influence of psychosocial factors such as family and peer-approval on
consumer perceptions toward the No Name Brand food items
56
Table 4.7: "I buy No Name Brand food items" * Age Cross tabulation
60
Table 4.8: "I buy no name brand food items" * Education Level- Cross tabulation
61
Table 4.9: "I buy no name brand food items" * Income Level Cross tabulation
62
Table 4.10: "Buying No Name Brand food items save a lot of money"
* Age- Cross tabulation
63
Table 4.11: "Buying No Name Brand food items save a lot of money"
* Education -Cross tabulation
64
Table 4.12: "Buying No Name Brand food items save a lot of money"
* Income- Cross tabulation
65
Table 4.13: "Buying No Name Brand food items provides a high quality product"
* Age- Cross tabulation
66
11
Table 4.14: "Buying No Name Brand food items provides a high quality product"
*Education- Cross tabulation
67
Table 4.15: "Buying No Name Brand food items provides a high quality product"
*income- Cross tabulation
68
Table 4.16 "Buying No Name Brand food items is something people may look down upon"
* Age-Cross tabulation
70
Table 4.17 "Buying No Name Brand food items is something people may look down upon"
* Education- Cross tabulation
71
Table 4.18 "Buying No Name Brand food items is something people may look down upon"
* Income Cross tabulation
72
Table 4.19 "Buying No Name Brand food items provides a high quality product" *
"Generally speaking the lower price of food items indicates lower quality"
74
12
LIST OF FIGURES
Figure 2.1: The Consumer Decision Process Model
24
Figure 4.1: Frequency distribution of responses for statement 2
47
Figure 4.2: Frequency distribution of responses for statement 3
48
Figure 4.3: Frequency distribution of responses for statement 4
48
Figure 4.4: Frequency distribution of responses for statement 5
49
Figure 4.5: Frequency distribution of responses for statement 6
50
Figure 4.6: Frequency distribution of responses for statement 7
52
Figure 4.7: Frequency distribution of responses for statement 8
53
Figure 4.8: Frequency distribution of responses for statement 9
53
Figure 4.9: Frequency distribution of responses for statement 10
54
Figure 4.10: Frequency distribution of responses for statement 11
55
Figure 4.11: Frequency distribution of responses for statement 12
55
Figure 4.12: Frequency distribution of responses for statement 13
57
Figure 4.13: Frequency distribution of responses for statement 14
58
Figure 4.14: Frequency distribution of responses for statement 15
58
13
Chapter One - Introduction
1.1 Introduction
In today's complex business environment, doing business is no longer business as usual; it
has evolved into quick change, quick response, and quick results. In such an environment it is
only those business enterprises which understand these trends and position themselves for
tomorrow can survive and grow successfully. Nowhere is this reality truer than in the retail
industry, where changes on the consumer side are creating new challenges and opportunities
at a frantic pace.
In the past, the consumers' demand for high-profile brands let a retailer capitalize on the
foundation of those solid, reputable brands to build its own reputation. This brand centric-
approach to retailing meant strong competition, which has resulted in tight profit even to the
bigger players of the industry. In response to the increased challenges, there has been a
significant movement by most prominent retailers towards store brand solutions to improve
margins and better meet the changing needs of the consumer. By creating high-quality
product tied to the retailer's own brand, retailers are reaping the benefits of brand loyalty for
themselves. Leading global retailers like Wal-Mart, Aldi, Asda, Marks & Spencer, Migros,
Tesco, Loblaw and many others now have two or three store brands, which allow for appeal
across a wider variety of price points. According to recent studies, in Europe, store brands
already represent over 45 Percent of the product mix, while in the U.S., store brands represent
25 percent (Internet 5).
Compared to the U.S and Europe, the South African market for store brands is not well
developed and is far from being saturated. Store brands are sold throughout retailers in the
country and categories are widespread - from beverages (milk, coffee, water, etc); including
most confectionary categories; most household and toiletry categories; and from premium
brands, to the more cost effective. Leading retailers like Spar, Shoprite, and Pick n' Pay and
others have various store brands. Even though South African retailers are utilizing own brands
as a means of differentiation, some studies are also indicating the lack of well tuned major
store brand strategies and own brands were not perceived as of value by consumers as well
(Internet 2).
14
Like in the case of national brands, retailer's brands have also evolved into many different
forms (McGoldrick, 2002). The focus of this study is on the No Name Brand food items
which are one form of the store brands offered by the Pick n' Pay Group in their discount
supermarkets. In other countries the No Name Brands are also offered by leading retailers
such as the Loblaws of Canada
(Internet 4).
The Pick n' Pay Group has both commercial and non commercial objectives to be attained
with offering the No Name Brand food items. However, the successes of these objectives
largely depend on the consumer's trust in the company and particularly on the No Name
Brand products themselves. Therefore, this study is undertaken to establish a greater insight
into consumer perceptions toward those products by investigating the influence of selected
economic, psychosocial and demographic variables. There after, based on the empirical
findings, necessary recommendations are forwarded which could help the company to deliver
relevant product and service benefits to the consumer while gaining true customer loyalty to
its retail brand.
1.2 Background for the Research
This section provides a brief overview on: the definition of store brands, the store brand
market around the world and South Africa and the opportunities as well as challenges for
retailers of store brands.
1.2.1 The Distinction between Manufacturer's and Retailer's Brands
Brands are commonly divided in at least two groups: manufacturers' brands (commonly
known as national brands) and distributors' brands (also known as retailer brands).
De Chernatony and McWilliam (1988:4) present a very complete definition of these two types
of brands. According to the authors, a distributors' brand is:
"An added value entity, produced by or on behalf of a distributor following the distributor's
specifications. It is targeted at specific consumers and portrays a unique relevant and
distinctive personality, which is clearly associated with the distributor and is backed by a
coherent use of marketing resources."
15
The authors also define a manufacturer's brand as:
"An added value entity conceived and primarily developed by a manufacturer for a specific
group of customers and consumers, which portrays a unique relevant and distinctive
personality through the support of product development, promotional activity and an
appropriate pricing and distribution strategy" (De Chernatony and McWilliam, 1988: 4).
Those two definitions show the ownership of the brand is the basis for classification.
However, retailer's brands have also evolved into many different forms. In fact, finding a
comprehensive terminology was a serious problem in this study. For example, KPMG
(Internet 3) has identified the following different `species' of retailer brands:
Store brands: - carry the retailer's name, but no additional sub-brand. For example, Tesco's
standard store brands.
Store sub-brands:- carry both the retailer's name and a sub-brand. For example, Tesco's
Finest range.
Generic brands: - have a name independent from the store name. For example,
Euroshopper's range of products. These are not named store brands; they can be used across
differently named stores and chains
Individual product brands: - are owned by the retailer and are treated by the company like
individual brands. For example, Aldi uses individual product brands. The retailer's name may
be visible in the background but is not emphasized.
Exclusive products: - are not, by definition, private label products, but possess some similar
characteristics. For example, Migros in Switzerland has a number of exclusive agreements
with suppliers (for example, with Del Monte).
In this study the term used is `store brand'; and according to ACNielsen, it is broadly defined
as: "A brand name owned by the retailer or a wholesaler for a line or variety of items under
exclusive or controlled distribution" (Internet 1).
16
1.2.2 An Overview of Store Brands: other Countries versus South Africa
The development of the retailer's name as a brand rather than simply a name over the shop is
among the major corner stones in the modern retail marketing (McGoldrick, 2002). The role
and importance of store brands have changed dramatically over the past decades. Cheap
imitations of major brands and store and private brands are evolving into full-fledged
alternatives, capable of competing successfully with manufacturer's brands on quality as well
as on price (Quelch and Harding, 1996).
The global breath of store brands during the period of 2002-2003 is well demonstrated by
ACNielsen on the research conducted across five regions, focusing on 36 specific countries
with established store brand markets. From a category perspective, the study looked at the
presence of Private Label across 80 different categories which were selected from 14 larger
product areas. According to the findings, store brands showed stronger growth and outpaced
manufacturer branded products in nearly two-thirds of the markets studied (22 out of 36
markets). The study also indicated the European and North American markets accounted for
95 percent of the aggregated store brand market and the three less developed regions
accounted only for 5 percent. It is equally important to note, however, that of the top ten
countries worldwide that experienced the fastest store brand sales growth (over 20 percent
growth in the last year); nine were from these same regions of Emerging Markets, Latin
America and Asia Pacific (Internet 1).
ACNielsen's study also shows that South Africa was number twenty one in the market
ranking, with a store brand share of 6 percent and was one of the world's fastest growing
markets in store brand sales, with a 28 percent growth rate versus year ago( Internet 1).
1
.2.3 Risks and Benefits of Store Branding for Retailers
A review of the literature on store brands identified a number of factors that explained the
necessity for developing marketing programs for store brands. Carrying store brands come
with numerous advantages, one of which is the relatively high gross margin, which can be 25
to 50 percent higher compared to manufacturer brands (Keller, 1993). This high margin
mainly results from the more efficient marketing effort, the reduction of middlemen, and
economies of scale obtained in distribution. Moreover, they present value to consumers by
offering a combination of `good quality' and `better-value' products, and reinforce the
17
retailer's name both on the store shelves and in consumers' homes (Fitzell, 1992). One of the
leading private label consultant companies, the QRS Corporation (Internet 5), also
summarized the potential rewards associated with effective store brand programs. Well-
designed store brand strategies:
·
Create more interest and dependence on the retailer by the customer: by offering
products that aren't available at the competition, a retailer creates a sense of variation
and choice that can attract and keep customers.
·
Generate customer loyalty and avoid product and retailer comparisons: by offering
unique offerings, a retailer can avoid price comparisons and earn customer loyalty.
·
Give the retailer more freedom on pricing strategies: creative pricing strategies and
strategic assortment management can truly take place if goods are under the retailer's
price control. In branded scenarios most prices are standard and have no flexibility,
even if the point goods are marked down.
·
Develop supplier relationships that are able to adapt quickly to new concepts and
create products to the retailer's specifications: many times, suppliers are quite open,
willing and able to produce new lines tailored to the retailer's own customers' needs
and generally produce a tremendous cost savings to both the retailer's gross margin
and the customer's wallet.
·
Offer significantly increased margins: improved gross margin is a clear benefit of a
successful store brand program.
Parallel to the potential paybacks, retailers can also face various potential risks emerging from
weak store brand strategies. According to Thompson (1999), for retailers, there are multiple
risks associated with the introduction of new products under store label. Store brands are
typically umbrella brands, including various product categories. A negative experience with
one product category can prevent consumers from buying store brands in other categories, and
even erode customer confidence in the store as a whole. Sullivan (1990) also underlined that
18
the larger the numbers of categories marketed by an umbrella brand, the more negative the
spill-over effects that occur.
According to McGoldrick (2002), majority of retailers use price as a major tool of achieving
competitive advantage in the store brand categories. However, consumers also have a
tendency to impute a quality on the bases of price. Consequently, it may be difficult to
convince consumers that a cheaper store brand is of good quality, even if it does score top
marks in laboratory tests (De Chernatory et al. 1992). Taking in to account the instrumental
role store brands play within the overall image of retail companies, the QRS Corporation
emphasized the importance of quality and image monitoring program as follows:
"Quality becomes even more critical for a store brand than a national brand because a
retailer's reputation is at stake. If the customer has a bad experience with a national-brand
product, he may return it to the store for a refund but he won't hold the retailer responsible for
the quality of the product. A store-brand product, though, carries the reputation of the retailer
on every package, if the quality is below par, the customer will think twice about buying the
product" (Internet 5).
In conclusion, as many researchers on this area indicated, adequate planning, accurate
forecasting, and appropriate brand managing are the requisites for retailers to achieve the
growth opportunities that store brands offer. As highlighted by Smart Marketing ( Internet 6),
commitment to quality along with delivering produce to meet the standards of today's
consumers' expectations on a permanent basis, and ensuring that the product being packaged
corresponds to the image of the store are among the major challenges store brand retailers
should tackle. Moreover, as indicated by Hoch and Banerji (1993), no store brand program is
complete without a solid consumer research process. Focus groups, taste testing, occasional
surveys and other activities usually conducted by manufacturers should be adopted by
retailers for their own brand products.
19
1.3 Motivation for the Research
Based on the findings of ACNielsen, the South African Fast Moving Consumer Goods
(FMCG) described the prevailing store brand environment and opportunities in South Africa
as follows:
"Store brands are sold throughout retailers in South Africa and categories are widespread -
from beverages (milk, coffee, water, etc); including most confectionary categories; most
household and toiletry categories; and from premium brands, to the more cost effective. There
are still mega opportunities in the own brand category, as the market is far from being
saturated. Though South African retailers are utilizing own brands as a means of
differentiation, for various reasons, there were currently no major own brand strategies and
own brands were not perceived as of value by consumers as yet. Consumer perception of the
value and quality of own brands are low and branded goods were seen as of a better quality by
consumers" (Internet 2).
These findings clearly showed that there is limited understanding of the factors influencing
the South African consumer in relation to store brands consumption. The reasons behind
consumer's unfavourable perception on store brands need to be investigated. With out solid
understanding of the consumer, the available growth opportunities in the store brand category
are likely to be missed. Therefore for retailers to take advantage of the opportunities in the
store brand category a greater understanding of consumer behaviour is required.
1.4 Value of the Project
The prime focus of this study is to investigate the dominant factors which influence consumer
favourable and/or unfavourable perceptions on the No Name Brand food items. The results of
the study will contribute towards a greater insight into consumer perceptions on the No Name
brand food items which can help the Pick n' Pay Group in formulating effective retail
marketing strategy for those specific products. Furthermore, the No Name brand is also one
form of store brands; hence, the findings of the study will have some implications toward
other store brand categories prevailing in the South African retailing market.
20
1.5 Problem Statement
The Pick' n Pay Group claims that its No Name Brand food items are designed to provide the
consumer with greater value for money. However, previous studies also indicated that
consumers have the general tendency of attributing the lower price of store brands to a lower
quality. Does this also apply to the No name brand food items?
1.5.1 Sub Problem
What is the role of psychosocial factors such as family and peer approval and demographic
factors such as age, education and income on consumer perceptions toward the no name brand
food items?
1.6 Objectives of the Study
The main objectives of the study are:
·
To evaluate consumer's overall awareness and usage level of the No Name Brand
food items
·
To determine consumers' perception toward the economic benefits such as saving and
quality the No Name Brand food items offer
·
To determine the influence of psychosocial factors such as family and peer approval
on consumer perceptions towards the No Name Brand food items
·
To establish the influence of the 3 demographic variables i.e. Age, Education and
Income on consumer perceptions toward the No Name Brand food items.
1.7 Research Hypothesis
For the purpose of this study a null hypothesis (Ho) and an alternative hypothesis (Ha) were
formulated in relation to the problem statement of the study. The null hypothesis (Ho) and the
alternative (Ha) hypotheses were:
21
·
Null hypothesis (Ho): Consumer perception toward the quality of the No Name Brand
food items is influenced by the general tendency of attributing the lower price of store
brands to a lower quality.
·
Alternative hypothesis (Ha): Consumer perception toward the quality of the No Name
Brand food items is not influenced by the general tendency of attributing the lower
price of store brands to a lower quality.
The decision rule applied to reject or accept the null hypothesis is stated in the following
manner: Reject Ho if computed or observed F value (Fov) is greater than the critical F value
(Fcv); retain Ho if otherwise.
1.8 Limitations of the Research
The field of consumer behavior is so wide and consumer perception toward various products
can be affected by many interlinked variables. However, this study is limited by time and
resources; hence, limited variables are used in investigating consumer perceptions toward the
No Name Brand food items. Moreover, the this study is also limited to Durban Metro area
and majority of the sample for the study is obtained from consumers shopping at Pick' n
Pay stores located in the Workshop and Musgrave Centre and Some of the sample is
obtained from the staff and student community at the University of KwaZulu-Natal.
1.9 Structure of the Study
An overview of the sections of this study is presented below.
Chapter two of this study provides a brief overview of consumer behavior theory and some
literature on previous studies conducted on store brands. The literature on consumer behavior
focuses on consumer decision making process as well as on individual and environmental
determinants of the consumption behavior. Some basic literature on store brands is already
included in chapter one; and in chapter two previous studies concerning some of the factors
which influence consumer acceptance of store brands are included.
Details
- Seiten
- Erscheinungsform
- Originalausgabe
- Jahr
- 2004
- ISBN (eBook)
- 9783836642132
- DOI
- 10.3239/9783836642132
- Dateigröße
- 878 KB
- Sprache
- Englisch
- Institution / Hochschule
- University of KwaZulu-Natal – Management Studies
- Erscheinungsdatum
- 2010 (April)
- Note
- 1,3
- Schlagworte
- consumer behaviour market analyses store brands quality sampling
