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Defensive Strategy Against a Private Label: Building Brand Equity

In: National Brands and Private Labels in Retailing

Author

Listed:
  • S. Chan Choi

    (Rutgers Business School—Newark and New Brunswick)

Abstract

We build a game-theoretic model of price competition between a national brand manufacturer and a retailer that also sells its private label. In particular, we examine brand-equity building as a strategy for the national brand manufacturer. We find that brand building should be the first line of defense instead of aggressively cutting the wholesale price. Not only the national brand but also the retailer can benefit from it, which can justify cost sharing of brand-building efforts with the retailer.

Suggested Citation

  • S. Chan Choi, 2014. "Defensive Strategy Against a Private Label: Building Brand Equity," Springer Proceedings in Business and Economics, in: Juan Carlos Gázquez-Abad & Francisco J. Martínez-López & Irene Esteban-Millat & Juan Antonio Mondéja (ed.), National Brands and Private Labels in Retailing, edition 127, pages 53-59, Springer.
    • Handle: RePEc:spr:prbchp:978-3-319-07194-7_5
    DOI: 10.1007/978-3-319-07194-7_5
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