The resistible rise of private labels
This paper is argues that increasing the number of private labels products in grocery stores is not always an efficient strategy for a retailer wishing to enhance her unit sales. Although private labels can be effective for providing higher margins or developing customer loyalty program, their increased number of Stock Keeping Unit (SKU) assumes item deletions for other types of brand - especially national brands. For this study, we choose to focus on the composition of the whole brand assortment rather than the competitive advantage of this or that brand type. This paper proposes an econometric approach to this assortment reshaping issue. Using data drawn from a retailer panel (provided by IRI Inc), we construct a Multiple Adaptive Regression Spline (MARS) model to investigate the relation between both private label's and national brand's SKU and store-level unit sales. Results are given with respect to store size. We find that only in biggest stores higher levels of private labels leads to enhanced sales.
|Date of creation:||10 Jun 2009|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00784013|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
When requesting a correction, please mention this item's handle: RePEc:hal:wpaper:halshs-00784013. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CCSD)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.