Does Private Label Quality Influence Consumers' Decision on Where to Shop?

When consumers decide where to shop, they take several criteria into account. It is not yet clear whether private label (PL) quality is one of these criteria. It is the intention of this study to shed light on this issue because many retailers have invested heavily into the quality of their PLs. They assume that PLs differentiate a store's assortment and image, which should attract customers to the store. This study examines this assumption by use of a simultaneous equation model that links PL-specific quality evaluations to perceptions of the image of the associated store as well as to the category-specific share of store visits. Empirical results for 10 product categories show that PL quality positively affects store image perception, and influences consumers in the decision of where to shop.