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Price Effects of Private Label Development

Author

Listed:
  • Bontemps Christophe

    (University of Toulouse (INRA), France)

  • Orozco Valerie

    (University of Toulouse (INRA), France)

  • Réquillart Vincent

    (University of Toulouse (INRA, IDEI), France)

  • Trevisiol Audrey

    (University of Toulouse (INRA), France)

Abstract

We study the price response of national brands to the development of private labels. Using monthly data from a consumer survey, we show that prices of national brands increase with the development of private labels. However, we also show that the price increase in national brand products is explained by a strategy of product differentiation. Finally, price reaction of national brands differs with the type of private labels they are facing.

Suggested Citation

  • Bontemps Christophe & Orozco Valerie & Réquillart Vincent & Trevisiol Audrey, 2005. "Price Effects of Private Label Development," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 3(1), pages 1-18, February.
    • Handle: RePEc:bpj:bjafio:v:3:y:2005:i:1:n:3
    DOI: 10.2202/1542-0485.1086
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    1. Michael B. Ward & Jay P. Shimshack & Jeffrey M. Perloff & J. Michael Harris, 2002. "Effects of the Private-Label Invasion in Food Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 961-973.
    2. Gabrielsen, Tommy Staahl & Sorgard, Lars, 2007. "Private labels, price rivalry, and public policy," European Economic Review, Elsevier, vol. 51(2), pages 403-424, February.
    3. André Bonfrer & Pradeep K. Chintagunta, 2004. "Store Brands: Who Buys Them and What Happens to Retail Prices When They Are Introduced?," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 24(2), pages 195-218, March.
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