International Journal of Business and Management Tomorrow

Vol. 2 No. 5

A Study on Consumers Attitude towards Private Labels: A Special Focus in Baroda & Rajkot
Dr Amit R Pandaya, Reader, Department of Commerce & Business Administration, M S University of Baroda Monarch A Joshi*, Assistant Professor, Indu Management Institute

Abstract
Retail, one of Indias upcoming industries, has presently emerged as the most dynamic and fast paced industries of recent times with several players entering the market. One of the routes to succeed in retail business is to focus on own brands / store brands / private label brands (PLs) ; as the financials of retail firms are very sensitive to margins on the brands they sell. Further, PLs also offer retailers greater control over the supply chain, negotiating margins with National Brand (NBs) manufacturers or companies; opportunity to launch customized products; opportunity to launch innovative products, hence to build platform for store loyalty and increase footfalls. As managing PLs is quite critical function, hence they are to be managed professionally. This paper focuses on, determining & comparing customers attitude towards NBs & PLs with respect different attributes. Further it also discusses the effect on preference pattern with respect to demographic profile of respondents for private label brands in different product categories. Keywords: Store Brands, Private Labels, Own Labels, Retailing in India

1. Introduction
Global retail sales crossed US$12 trillion in 2007. Almost reflecting the growth in the world economy, global retail sales grew strongly in the last five years (2002-07) at an average nominal growth of about 8 per cent per annum in dollar terms.1 In the developed economies, organized retail is in the range of 75-80 per cent of total retail, whereas in developing economies, the unorganized sector dominates the retail business. The share of
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Planet Retail Database

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organized retail varies widely from just one per cent in Pakistan and 4 per cent in India to 36 per cent in Brazil and 55 per cent in Malaysia. The Indian retail market, which is the fifth largest retail destination globally, has been ranked the second most attractive emerging market for investment after Vietnam in the retail sector.2 Therefore, manufacturers must capitalize on this ever-escalating trend so that youths can spend their purchasing power in a healthy way, contributing towards the overall development of the country. It is currently (2009) estimated at around US $ 450 billion, is expected to touch US $ 720 billion by 2011, US $ 833 by 2013 and to US $ 1.3 Trillion by 2018. The organized retail sector currently estimated at $ 63 billion (14 per cent of the total) will, however, grow much faster at 40 per cent to reach $ 90 billion during this period. The overall Indian retail market is growing at 30 per cent; the annual rate of growth for the organized sector is going to be at around 40 per cent. The organized retail market is growing at the rate of 40 per cent and is anticipated to grow at a faster pace over the next three years, especially in view of the fact that major global players and Indian corporate houses are entering the fray in a big way. At the current growth rate it is expected to touch $90 billion by 2010. In 2009 retail sector accounts for 12 per cent of the countrys GDP and is likely to reach 22 per cent by 2010 & employs around 9 per cent of its workforce is well on its way to become a boom sector of the economy. 3 The Indian organized retail sector accounts for only 5% in the country. 4 And it is expected to contribute 15.5 per cent by 2016.5 Research on store brands or PLs has been of substantial interest to the retailers as well as academicians. Research in this area was conducted by few researchers, viz. The factors associated with PLs adoption, the consumer attitude towards store brands and its relationship with customer satisfaction and store loyalty. Private Labels are defined as the products owned and branded by the organizations whose primary objective is distribution rather than production6 Store brands or private label brands are also defined as brands owned, controlled and sold exclusively by retailer. 7 PLMA defines it as Private label products encompass all merchandise sold under a retailers brand. That brand can be the retailers own name or a name created exclusively by that retailer. In some cases, a retailer may belong to a wholesale group that owns the brands that are available only to the members of the group.8 The above definitions suggest two things. First, it is the retailer who owns and controls the brand, whereas this was traditionally the role of the producer. Second, the retailer has exclusive rights over the product. This means that different retailers do not sell identical PLs, which is not the case when retailers sell name-brands. Thus, the development of PLs does not only alter the relationship between producers and retailers, but also affects competition between retailers because PLs become an additional way of differentiating between retailers.9 The two main advantages derived from the adoption of PLs by retailers are: bigger margins, and increased store loyalty.10 In order to be truly successful, retailers must advance from the generic or store brand mindset of the past to a new private label paradigm. Many retailers have begun to describe their private label brands as own brands because there is recognition that these proprietary, exclusive offerings are tools that represent momentous power and potential for the retail store. Sales of PLs, also called "store brands," have been growing rapidly in recent years.11 Private labels have potential to increase store loyalty, chain profitability, control over shelf space, bargaining power over manufacturers, etc.12 Among consumers, one obvious reason for their popularity and growth is their price advantage (averaging 21%) over national brands.13 Nevertheless, high quality seems to be more important in determining PLB success than lower price.14 PLs are articulated and developed in a way that they not only fit with the brand promise of the retail store, but if effective, they also give consumer a key point of departure to enhance and celebrate the overall retail brand proposition to keep consumers coming back for more. One of the

AT Kearneys 7th annual GRDI, in 2008. Indian Retail Research 2009 Edition Northbridge Capital 4 FICCI Earnest & Young 5 Investment Commission of India 6 Schutte, 1969 7 Baltas, 1997 8 Private Label Manufacturers Association 9 Berges-Sennou, Bontems, and Requillart 2004 10 Fontenelle 1996 11 Batra & Sinha, 2000 12 Richardson, Jain, and Dick, 1996 13 Batra and Sinha, 2000 14 Hoch and Banerji, 1993; Sethuraman, 1992
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interesting phenomena concerning PLBs is the fact that their growth has been highly uneven across product categories.15 The present study has been undertaken to gain an insight into Indian customers attitude towards private label brands as well as national brands, the effect on preference pattern & variations with respect to demographic profile of respondents for private label brands versus national label brands across three product categories. For this purpose respondents from two city of Gujarat were studied viz. Baroda & Rajkot.

2. Literature Review
In studying the retailer store brand or private labels, researchers have mostly examined factors such as the technology, investments necessary, size of category, category margins, brands advertising and promotional activity levels and so forth (Hoch and Banerji, 1993; Sethuraman, 1992). Thus, Hoch and Banerji (1993) find that PLs have higher shares in large categories offering high margins, and where they compete against fewer national manufacturers who spend less on national advertising. The gap between NBs and PLs in the level of quality also depends on the technology requirements in manufacturing that varies across categories Hoch and Banerji, 1993). Some researchers studying consumer-level factors for PL proneness--such as Richardson, Jain and Dick (1996)--have not studied cross category variations. They have chosen instead to aggregate data across categories. Sethuraman and Cole (1997), for instance, did not measure and model the crucial effect of the level of perceived risk in the product category (Richardson, Jain, and Dick, 1996; Narasimhan and Wilcox, 1998). In this research, we focus upon these consumer-level perceptions of inter category differences. By doing so, we hope to shed light on what has made PLs successful overall, drawing implications both for retailers marketing PLs as well as the national brands that compete with them. Any examination of the consumer-level factors that moderate PLs success across product categories should start with a framework to explain consumers susceptibility to buying PLBs. Richardson, Jain, and Dick (1996) present what is probably the most extensive such framework offered to date. They argue that consumers' propensity to purchase PLs depends on (a) certain demographic factors, such as income, family size, age and education, (b) certain individual difference variables, such as the degree of reliance by the consumer on extrinsic cues (those more reliant on such cues preferring national brands) and the consumers' tolerance of ambiguity (intolerants preferring safer national buys), and (c) certain consumer perceptions of the particular category (degree of perceived quality variation, level of perceived risk, and perceived value for money), as well as the degree of consumer knowledge about the category (greater knowledge increasing PLs choice). Note that though several of these perceptual factors ought to vary across categories (such as the degree of perceived quality variation, level of perceived risk, perceived value for money, and degree of consumer knowledge), Richardson, Jain and Dick did not study category-level variations in these factors. Researchers have examined differences of quality perceptions for national and private label brands. Initial study done by Bellizzi et al. (1981) gathered perceptions of national, private label and generic brands through a series of Likert-type scales. Respondents showed significant perceptual differences for the three types of brands and consistently rated private label brands below the national brands on attributes related to quality, appearance, and attractiveness. Similarly, Cunningham et al. (1982) observed that consumers rate national brands as superior to private label and generic brands in terms of taste, appearance, labeling, and variety of choice. Rosen (1984) conducted a telephone survey of 195 households and obtained ratings for generic, private label, and national brand grocery products on three quality perceptions: overall quality, quality consistency over repeat purchases, and quality similarity across stores. Data gathered across nine product categories showed that private label brands had lower scores in comparison to national brands for overall quality as well as quality consistency over repeat purchases. Omar (1994) conducted similar test of quality for private label and national brands across three product categories. The results showed that consumers did not perceive any difference among the brands during a blind taste test but revealed taste test indicated that shoppers assigned superior ratings to national brands. Thus, private label offers were rated much lower in revealed taste test than in blind taste test. Invariably, all these studies indicated that private label brands suffer from low quality image when compared with national brands despite improvements made in the quality. This spawned efforts by academicians and practitioners to examine the ways to improve the quality perceptions of private label brands. Sethuraman and Cole (1997) did model category level variations in many factors. They examined the effect on "willingness to pay a price premium for a national brand" of (a) several category level variables, including the quality perception of PLs, average price, purchase frequency, and the degree to which the category gives "consumption pleasure," (b) individual demographics such as income, age, family size, gender and education,
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and (c) individual difference perceptual variables such as the belief of a price-quality relationship, perceived deal frequency, and familiarity with PLs . However, as noted above, their list of category-level variables did not include crucial perceptions of the degree of category perceived risk. Price Consciousness, defined as the "degree to which the consumer focuses exclusively on paying low prices" (Lichtenstein, Ridgway, and Netemeyer, 1993, p. 235), has been found to be a predictor of PLs purchase (Burger and Schott, 1972; Rothe and Lamont, 1973). Previous research has shown that a consumer's level of price-consciousness rises with lower incomes (Gabor and Granger, 1979; Lumpkin, Hawes, and Darden, 1986), and is higher among deal-prone consumers (Babakus, Tat, and Cunningham, 1988) who believe less in price-quality associations (Lichtenstein, Bloch, and Black, 1988). Research has for long talked of the level of perceived risk in the category as being a crucial factor in PLs purchases (Bettman, 1974; Richardson, Jain, and Dick, 1996), though this variable has either not been studied at the individual category level (e.g., by Richardson, Jain, and Dick, 1996), or has been omitted in some recent category-level studies (e.g., Sethuraman and Cole 1997). Such perceived risk can be gauged using performance, financial, or social criteria (Dunn, Murphy, and Skelly, 1986). Drawing on the literature on perceived risk (e.g., Bauer, 1967; Cox, 1967), Narasimhan and Wilcox (1998) argue that consumers will prefer national brands to PLs if the level of perceived risk in buying the PLs in that category is seen as high. They also state that the degree of perceived risk increases with the degree of perceived quality variation. Dunn, Murphy, and Skelly (1986), and others, is the "degree of inconvenience of making a mistake." Consumers rated national brands higher than PLBs and generics on prestige, reliability, quality, attractive packaging, taste, aroma, color, texture, appealing, tempting, purity, freshness, uniformity, familiarity, confidence in use, among others, Bellizi et al. (1981). Consumers tend to utilize extrinsic cues, such as a brand name, when confronted with ambiguous attributes that lower their perceived ability to make objective, quality-comparisons across brands Hoch and Ha (1986). Thus, a review of previous studies undertaken in the area of PLBs indicates that, research has been more limited on the consumer-level factors that make PLBs differentially successful across product categories. Also the effect of demographic variables on customer perception and preference for private label brands across different product categories has hardly been researched. Given the lack of studies undertaken in the area of understanding Indian customers attitude and perception towards private label brands across product categories and the effect of demographic variables on this perception, the present study has been undertaken to gain an insight into how customers in India, perceive and evaluate private label brands in comparison to national label brands. The findings of the study will be helpful for retailers to understand the importance of various factors in being successful with customers in the private label brands category.

3. Research Objectives
To study & find out attributes on which consumers evaluate both Private Labels (PLs) & National Brands (NBs). Find & compare the overall customers attitude towards private label versus national brands across different attributes, categories & demographic variables in two cities of Gujarat viz. Baroda & Rajkot.

4. Research Design & Methodology

Tool employed for generating responses was structured questionnaire, consisting of 19 Questions out of which 8 Questions were framed to gather demographic as well as personal profile of respondent, while 1 Question was framed to rate individual brand attribute on Likert Scale, 10 Questions were framed to rate & compare different attributes across 3 different selected categories on Likert Scale. Demographic factors were identified from various past studies in the similar areas: Richardson, Jain, and Dick (1996). While different attributes viz. Image (Brand Image / Stores Image), Quality, Price, Risk, Packaging have been identified to assess the consumer evaluations of PLs & NBs were identified from the past studies as follows. Dolekoglu et al. (2008) stated factors viz. quality, price, trust, availability of alternatives, attractive packaging, frequent advertising, sales promotions, imitations, well-known, healthy, availability, brand image, prestige, freshness and habits. Wells, Farley, Armstrong (2007) stated factor viz. Packaging. Batra & Sinha (2000); Bettman, 1973; Dunn et al., (1986); Richardson, Jain, & Dick (1996) stated Perceived Risk as factor. Batra and Sinha 2000 stated Price Consciousness, Price-Quality association as factors influencing customers attitude. ISSN: 2249-9962 May|2012 www.ijbmt.com Page | 4

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Ashokkumar and Gopal (2009) studied Price, Quality, Risk perception as factors affecting consumers attitude. While relationship between Price and Quality was studied by Ailawadi, Pauwels and Steenkamp (2008).

Research was conducted in two cities of Gujarat viz. Rajkot and Baroda. 100 respondents were studied. Stratified random sampling method (disproportionate method) was used to collect primary data. Information was collected from respondents outside different retail outlets. Moreover customers, consumers and respondents are used as synonyms to respondents of the selected sample while interpretation and analysis of data. It took 12 months, right from literature survey and review, designing the data collection tool, collection of data, analysis of data and report writing for publishing. For data analysis Adequacy Importance model is used, in which 5 attributes identified will be framed in model and importance will be measured on scale of 1 = Least Significant to 7 = Most Significant across different product categories. Adequacy Importance model happens to be one of the most widely used models appearing in consumer behavior research (Fishbein, Cohen & Ahtola (1972). Model can be described as:
= P* D Where = an individuals attitude toward the brands; P= importance of attribute (dimension) for the person; D= individuals evaluation of brands w.r.t the corresponding attribute (dimension).

Following table shows interpretation of respondents attitude with respect to mean calculated in ANOVA, as well as their belief towards different attributes associated with a product.
Mean calculated in ANOVA Interpretation as Attitude towards attribute Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Quality Price Risk Packaging Brand Image Corresponding belief with respect to Attribute Extremely low quality Extremely expensive Extremely risky Extremely unattractive packaging Extremely low brand image Quite of low quality Quite expensive Quite risky Quite unattractive packaging Quite low brand image Slightly low quality Slightly expensive Slightly risky Slightly unattractive packaging Slightly low brand image Neutral Neutral Neutral Neutral Neutral Slightly high quality Slightly cheap Slightly risk free Slightly attractive packaging Slightly high brand image Moderately high quality Moderately cheap Moderately risk free Moderately attractive packaging Moderately high brand image Extremely high quality Extremely cheap Extremely risk free Extremely attractive packaging Extremely high brand image

Extremely negative attitude towards :

Moderately negative attitude towards :

Slightly negative attitude towards:

Neither negative nor positive attitude towards:

Slightly Positive attitude towards :

Moderately positive attitude towards :

Extremely positive attitude towards :

5. Analysis & Results

Data reliability and validity plays most significant role in any research, before data analysis and interpretation. Questionn aire was reviewed by professional scholars and statistician in the related field. The content were reviewed and revised as per suggestions. The questionnaire used in the study thus qualified for expert validity. The present study had adopted internal consistency analysis to conduct reliability testing. Cronbachs came out to be 0.939, which indicates that reliability of t he scale of measurement was significantly high.

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Table 1: The demographic profile of respondents DEMOGRAPHIC PARAMETERS & CITY (N = n1+n2 = 100)

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Baroda Rajkot (n1 = 50) (n2 = 50) Male 30 39 Gender Female 20 11 18 to 30 20 38 Age Group 31 to 40 19 11 (Years) 41 to 50 05 00 51 to 60 06 01 Up to. 20,000 20 15 Monthly Household Income 21,000 to 40,000 17 22 (Rupees) 41,000 to 60,000 00 10 61,000 to 80,000 09 03 81,000 to 100,000 02 00 Nuclear 31 31 Type of Family Joint 19 19 Student 03 02 Occupation Housewife 05 02 Services 25 36 Self Employed / Business 08 10 Professional (Dr, CA, Lawyer, Consultant) 09 50 Unmarried 14 20 Marital Status Married 36 30 From in-depth literature review we find Quality, Price, Risk, Packaging & Brand Image as attributes which are most relevant to study categories viz. Home Care Products, Personal Care Products & Consumer Durables. Measuring & Comparing Attitude towards NBs & PLs. Importance of attitude towards NBs & PLs was calculated for 100 respondents from the formula of Adequacy-Importance with respect to different attributes across 3 categories as mentioned in Table 2. Further for comparison t - test for equality of means was carried out. Table 2: Test of significance between attributes towards NBs & PLs across different categories & cities. Baroda Categories Brand Attributes Attitude towards Attitude towards t-test for equality of Sig.(2 NBs PLs means; Df: 49 Tailed) N1 = 50 Mean Mean 14.1 8.86 7.692 .000* Consumer Quality Durables 3.16 6.38 -5.439 .000* Price 10.56 5 7.557 .000* Risk 5.4 4.56 1.444 .155 Packaging 8.44 4.9 5.258 .000* Brand Image 13.22 8.96 5.377 .000* Personal Care Quality Product 3.08 6.26 -4.892 .000* Price 10.42 5.2 7.348 .000* Risk 5.36 4.48 1.756 .085 Packaging 8.06 4.56 5.188 .000* Brand Image 12.88 9.06 4.673 .000* Home Care Quality Product 3.4 6.88 -5.403 .000* Price 10.56 5.68 6.149 .000* Risk 5.34 4.46 1.577 .121 Packaging 7.92 5.04 5.209 .000* Brand Image Rajkot Categories Brand Attributes Attitude towards Attitude towards t-test for equality of Sig. NBs PLs means; Df: 49 (2 -Tailed) N 2= 50 Mean Mean 13.32 8.92 6.747 .000* Consumer Quality Durables 5.08 10.24 -8.114 .000* Price 5.6 3.8 4.327 .000* Risk 4.02 3.54 1.899 .063 Packaging 9.94 6.36 5.407 .000* Brand Image 12.96 9.08 5.451 .000* Personal Care Quality Product 4.74 9.46 -6.377 .000* Price 5.6 3.72 4.190 .000* Risk 4.18 3.6 2.297 .998 Packaging 9.76 6.32 5.087 .000* Brand Image 13.04 8.9 6.173 .000* Home Care Quality Product 5.08 9.78 -6.501 .000* Price 5.6 3.72 4.156 .000* Risk 4.04 3.62 1.836 .720 Packaging 9.98 6.42 4.597 .000* Brand Image

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Analysis of consumers attitudes towards NBs vs. PLs shows that there was perceived difference on the attributes of quality, price, risk, brand image (difference in means are statistically significant at 5% significance level). However, there was no perceived difference on the attributes of Packaging (means are significant at 5% significance level). Further, means of NBs & PLs can be compared and interpreted from above table as follows: Table 3: Interpretation & Comparison of means (attitude) of NBs & PLs with respect to different attributes, product category & cities. Cases Attributes & Product Categories (Relationship Interpretation Baroda Rajkot between means) NBs perceived to 1 NB > PL Quality, Risk (i.e. Risk free) Quality, Risk (i.e. Risk free) be better than PLs and Brand Image across all and Brand Image across all the three product categories. the three product categories. PLs perceived to 2 NB < PL Price across all selected Price across all selected be better than NBs product categories. product categories. NBs & PLs 3 NB = PL Packaging across all three Packaging across all three perceived to be categories. categories. same Results of above study shows that attitude towards quality is an important element relating to private-label brand use; if all brands in a category are seen as sharing a similar quality, then private-label brand use is often observed to increase (Richardson et al.1994). But as proven in this study and other global studies, one constant finding of private-label research had been that quality is more important than price to shoppers (Hoch and Banerji 1993; Sethuraman 1992). Support for this belief was challenged, however, by Ailawadi et al.(2001). Burton et al. (1998) pointed out that the danger for a retailer using low prices alone with which to compete is that some consumers may use price as a proxy for quality. Richardson et al.(1994) found that private-label brands were considered by shoppers to be inferior in quality terms to national brands. With parameters such as quality and price in play, the question of risk becomes particularly relevant. Batra and Sinha (2000) noted that when the consequences of a purchase mistake are high or quality variability is considerable, then interest in private label groceries is likely to drop. Narasimhan and Wilcox (1998) argue that consumers will be less motivated to purchase private-label groceries if the level of perceived risk in that category is high. The searchversus-experience nature of the product is also important, in that if the product requires actual trial (such as taste), then interest in private label brands drops (Erdem & Swait 1998). Still, Burton et al. (1998) found that grocery shoppers being risk averse did not significantly impact on their attitude towards a private-label brand (Shannon and Mandhachitara 2005).

6. Demographic effect on consumers attitude towards private label

One way ANOVA was administered to find the significance; demographic parameters were taken as factors / independent variable while corresponding response with respect to attributes & product category was taken as dependent variable. Only significant results (significance at 5%) across different demographic parameters, attributes, product categories & city are tabulated & discussed as follows. Table 4 shows the list of abbreviations used while analysis of data. Table 4: List of Abbreviations Q P R PC BI _N_ _P_ CD PC HC Quality Price Risk Packaging Image National Private Consumer Personal Home Brand Label Durable Care Care Product Product

6.1 Effect of Gender on preference of Private Label Brands

As per table 5a & 5b, we noticed that attitude towards private label brands is not affected by gender of respondent in Baroda, while it is significant in Rajkot. Attitude of female from Rajkot is found to be moderately positive for risk as attribute for national brands across all selected categories (i.e. national brands are considered to be risk free). Slightly positive attitude is found of females from Rajkot towards private label home care products.

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Table 5a: Effect of Gender on attitude towards Private Label Brands (ANOVA): Rajkot Sum of Squares df Mean Square F Sig. R_N_CD Between Groups 6.661 1 6.661 6.491 .014 Within Groups 49.259 48 1.026 Total 55.920 49 R_N_PC Between Groups 6.661 1 6.661 6.491 .014 Within Groups 49.259 48 1.026 Total 55.920 49 R_N_HC Between Groups 6.661 1 6.661 6.491 .014 Within Groups 49.259 48 1.026 Total 55.920 49 R_P_HC Between Groups 2.890 1 2.890 4.270 .044 Within Groups 32.490 48 .677 Total 35.380 49 Table 5b: Effect of Gender on attitude towards Private Label Brands (Descriptive): Rajkot N Mean Std. Deviation Minimum Maximum R_N_CD Male 39 4.85 1.040 3 7 Female 11 5.73 .905 4 7 Total 50 5.04 1.068 3 7 R_N_PC Male 39 4.85 1.040 3 7 Female 11 5.73 .905 4 7 Total 50 5.04 1.068 3 7 R_N_HC Male 39 4.85 1.040 3 7 Female 11 5.73 .905 4 7 Total 50 5.04 1.068 3 7 R_P_HC Male 39 4.69 .863 3 6 Female 11 5.27 .647 4 6 Total 50 4.82 .850 3 6

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6.2 Effect of Age Group on preference of Private Label Brands

After administering the test it was noticed that attitude towards private label brands is not affected by age group of respondent, across all selected categories in both cities.

6.3 Effect of Monthly Household Income on preference of Private Label Brands

As per results tabulated in table 6a & 6b, customers attitude was find to be significant with respect to monthly household income in both selected cities. Customers of Baroda with monthly household income of Rs.61, 000 to 80,000 have extremely positive attitude towards all national brands across all selected categories, for packaging as attribute. Rajkots respondents with monthly house hold income of Rs.61, 000 to 80,000 have extremely positive attitude towards all national brands across Consumer durables, personal care products & home care products for quality as attribute. Table 6a: Effect of monthly household income on attitude towards Private Label Brands (ANOVA) Baroda Sum of Squares df Mean Square F Sig. PC_N_CD Between Groups 18.152 4 4.538 2.810 .036 Within Groups 72.668 45 1.615 Total 90.820 49 PC_N_PC Between Groups 18.152 4 4.538 2.810 .036 Within Groups 72.668 45 1.615 Total 90.820 49 PC_N_HC Between Groups 18.899 4 4.725 2.834 .035 Within Groups 75.021 45 1.667 Total 93.920 49 Rajkot Sum of Squares df Mean Square F Sig. Q_N_CD Between Groups 8.125 3 2.708 4.800 .005 Within Groups 25.955 46 .564 Total 34.080 49 Q_N_PC Between Groups 8.853 3 2.951 5.168 .004 Within Groups 26.267 46 .571 Total 35.120 49 Q_N_HC Between Groups 8.853 3 2.951 5.168 .004 Within Groups 26.267 46 .571 Total 35.120 49

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Table 6b: Effect of monthly household income on attitude towards Private Label Brands (Descriptive) Baroda N Mean Std. Deviation Minimum Maximum PC_N_CD Upto 20K 20 4.75 1.650 1 7 21K to 40K 17 5.29 .985 4 7 41K to 60K 9 4.11 .782 3 5 61K to 80K 2 7.00 .000 7 7 81K to 100K 2 5.50 .707 5 6 Total 50 4.94 1.361 1 7 PC_N_PC Upto 20K 20 4.75 1.650 1 7 21K to 40K 17 5.29 .985 4 7 41K to 60K 9 4.11 .782 3 5 61K to 80K 2 7.00 .000 7 7 81K to 100K 2 5.50 .707 5 6 Total 50 4.94 1.361 1 7 PC_N_HC Upto 20K 20 4.75 1.650 1 7 21K to 40K 17 5.35 1.057 4 7 41K to 60K 9 4.11 .782 3 5 61K to 80K 2 7.00 .000 7 7 81K to 100K 2 5.50 .707 5 6 Total 50 4.96 1.384 1 7 Rajkot N Mean Std. Deviation Minimum Maximum Q_N_CD Upto 20K 15 5.67 .816 5 7 21K to 40K 22 6.55 .671 5 7 41K to 60K 10 6.50 .850 5 7 61K to 80K 3 6.67 .577 6 7 Total 50 6.28 .834 5 7 Q_N_PC Upto 20K 15 5.60 .828 5 7 21K to 40K 22 6.50 .673 5 7 41K to 60K 10 6.50 .850 5 7 61K to 80K 3 6.67 .577 6 7 Total 50 6.24 .847 5 7 Q_N_HC Upto 20K 15 5.60 .828 5 7 21K to 40K 22 6.50 .673 5 7 41K to 60K 10 6.50 .850 5 7 61K to 80K 3 6.67 .577 6 7 Total 50 6.24 .847 5 7

6.4 Effect of Type of Family on Preference of Private Label Brands

With reference to table 7a & 7b, significant results were observed for both cities across few selected categories and attributes discussed below. Respondents from Baroda living in joint family, have extremely positive attitude towards national brands across consumer durables and home care products, while they have slightly positive attitude towards private label consumer durables and moderately positive attitude towards private label personal care as well as home care products for risk as attribute. Hence national brands are considered to be more risk free across all selected product categories compared to private labels. Slightly positive attitude is found amongst the respondents from joint family with respect to packaging as attribute for national brand consumer durable and personal care products in Baroda. Respondents from joint family have moderately positive attitude with respect to quality towards all selected categories of private label in Rajkot. Respondents from nuclear family have moderately positive attitude with respect to price towards all selected product categories of private label in Rajkot.

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Table 7a: Effect of type of family on attitude towards Private Label Brands (ANOVA) Baroda Sum of Squares df Mean Square F Sig. R_N_CD Between Groups 17.996 1 17.996 8.376 .006 Within Groups 103.124 48 2.148 Total 121.120 49 R_P_CD Between Groups 11.941 1 11.941 9.115 .004 Within Groups 62.879 48 1.310 Total 74.820 49 R_N_PC Between Groups 14.214 1 14.214 6.473 .014 Within Groups 105.406 48 2.196 Total 119.620 49 R_P_PC Between Groups 10.459 1 10.459 8.092 .007 Within Groups 62.041 48 1.293 Total 72.500 49 R_N_HC Between Groups 16.166 1 16.166 7.196 .010 Within Groups 107.834 48 2.247 Total 124.000 49 R_P_HC Between Groups 6.815 1 6.815 4.964 .031 Within Groups 65.905 48 1.373 Total 72.720 49 PC_N_CD Between Groups 7.092 1 7.092 4.066 .049 Within Groups 83.728 48 1.744 Total 90.820 49 PC_N_PC Between Groups 7.092 1 7.092 4.066 .049 Within Groups 83.728 48 1.744 Total 90.820 49 Rajkot Sum of Squares df Mean Square F Sig. Q_P_CD Between Groups 3.925 1 3.925 5.874 .019 Within Groups 32.075 48 .668 Total 36.000 49 Q_P_PC Between Groups 3.242 1 3.242 4.668 .036 Within Groups 33.338 48 .695 Total 36.580 49 Q_P_HC Between Groups 5.352 1 5.352 9.779 .003 Within Groups 26.268 48 .547 Total 31.620 49 P_P_CD Between Groups 6.455 1 6.455 5.651 .021 Within Groups 54.825 48 1.142 Total 61.280 49 P_P_PC Between Groups 9.252 1 9.252 8.563 .005 Within Groups 51.868 48 1.081 Total 61.120 49 P_P_HC Between Groups 8.186 1 8.186 7.224 .010 Within Groups 54.394 48 1.133 Total 62.580 49

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Table 7b: Effect of type of family on attitude towards Private Label Brands (Descriptive) Baroda N Mean Std. Deviation Minimum Maximum R_N_CD Nuclear 31 5.29 1.697 1 7 Joint 19 6.53 .964 4 7 Total 50 5.76 1.572 1 7 R_P_CD Nuclear 31 4.68 1.275 1 7 Joint 19 5.68 .885 4 7 Total 50 5.06 1.236 1 7 R_N_PC Nuclear 31 5.32 1.720 1 7 Joint 19 6.42 .961 4 7 Total 50 5.74 1.562 1 7 R_P_PC Nuclear 31 4.74 1.290 1 6 Joint 19 5.68 .820 4 7 Total 50 5.10 1.216 1 7 R_N_HC Nuclear 31 5.35 1.743 1 7 Joint 19 6.53 .964 4 7 Total 50 5.80 1.591 1 7 R_P_HC Nuclear 31 4.87 1.310 1 7 Joint 19 5.63 .895 4 7 Total 50 5.16 1.218 1 7 PC_N_CD Nuclear 31 4.65 1.330 1 7 Joint 19 5.42 1.305 3 7 Total 50 4.94 1.361 1 7 PC_N_PC Nuclear 31 4.65 1.330 1 7 Joint 19 5.42 1.305 3 7 Total 50 4.94 1.361 1 7 Rajkot N Mean Std. Deviation Minimum Maximum Q_P_CD Nuclear 31 5.58 .807 5 7 Joint 19 6.16 .834 5 7 Total 50 5.80 .857 5 7 Q_P_PC Nuclear 31 5.58 .807 5 7 Joint 19 6.11 .875 5 7 Total 50 5.78 .864 5 7 Q_P_HC Nuclear 31 5.48 .677 5 7 Joint 19 6.16 .834 5 7 Total 50 5.74 .803 5 7 P_P_CD Nuclear 31 6.16 1.003 3 7 Joint 19 5.42 1.170 3 7 Total 50 5.88 1.118 3 7 P_P_PC Nuclear 31 6.10 1.012 3 7 Joint 19 5.21 1.084 3 7 Total 50 5.76 1.117 3 7 P_P_HC Nuclear 31 6.10 1.012 3 7 Joint 19 5.26 1.147 3 7 Total 50 5.78 1.130 3 7

6.5 Effect of Occupation on preference of Private Label Brands

As per table 8a & 8b, it is observed that attitude towards private label brands is not affected by occupation of respondent in Rajkot, while it is significant in Baroda. Self employed respondents of Baroda have moderately positive attitude towards national brands across all selected product categories with respect to packaging as attribute.

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Table 8a: Effect of occupation on attitude towards Private Label Brands (ANOVA) Baroda Sum of Squares df Mean Square F Sig. PC_N_CD Between Groups 23.749 4 5.937 3.984 .008 Within Groups 67.071 45 1.490 Total 90.820 49 PC_N_PC Between Groups 23.749 4 5.937 3.984 .008 Within Groups 67.071 45 1.490 Total 90.820 49 PC_N_HC Between Groups 26.224 4 6.556 4.358 .005 Within Groups 67.696 45 1.504 Total 93.920 49

Table 8b: Effect of occupation on attitude towards Private Label Brands (Descriptive) Baroda N Mean Std. Minimum Maximum Deviation PC_N_CD Students 3 5.33 .577 5 6 Housewife 5 5.60 1.342 4 7 Service 25 4.32 1.435 1 7 SelfEmployed / Business 8 6.13 .835 5 7 Professional (Dr, CA, Lawyer, 9 5.11 .782 4 6 Consultant) Total 50 4.94 1.361 1 7 PC_N_PC Students 3 5.33 .577 5 6 Housewife 5 5.60 1.342 4 7 Service 25 4.32 1.435 1 7 SelfEmployed / Business 8 6.13 .835 5 7 Professional (Dr, CA, Lawyer, 9 5.11 .782 4 6 Consultant) Total 50 4.94 1.361 1 7 PC_N_HC Students 3 5.33 .577 5 6 Housewife 5 5.60 1.342 4 7 Service 25 4.32 1.435 1 7 SelfEmployed / Business 8 6.25 .886 5 7 Professional (Dr, CA, Lawyer, 9 5.11 .782 4 6 Consultant) Total 50 4.96 1.384 1 7

6.6 Effect of Marital Status on preference of Private Label Brands

As per results tabulated in table 9a & 9b, customers attitude was find to be significant with respect to monthly household income in both selected cities. Unmarried respondents of Baroda have slightly positive attitude towards national brands across all selected categories with respect to price, while have extremely positive attitude towards private label for the same attribute. Married customers have moderately positive attitude towards national brands across all selected categories with respect to brand image, while have slightly positive attitude towards private label for the same attribute.

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Table 9a: Effect of marital status on attitude towards Private Label Brands (ANOVA) Baroda Sum of Squares df Mean Square F Sig. P_N_CD Between Groups 4.013 1 4.013 5.191 .027 Within Groups 37.107 48 .773 Total 41.120 49 P_P_CD Between Groups 10.321 1 10.321 5.404 .024 Within Groups 91.679 48 1.910 Total 102.000 49 P_N_PC Between Groups 6.477 1 6.477 8.611 .005 Within Groups 36.103 48 .752 Total 42.580 49 P_P_PC Between Groups 10.896 1 10.896 5.911 .019 Within Groups 88.484 48 1.843 Total 99.380 49 P_N_HC Between Groups 6.477 1 6.477 7.384 .009 Within Groups 42.103 48 .877 Total 48.580 49 P_P_HC Between Groups 7.893 1 7.893 4.272 .044 Within Groups 88.687 48 1.848 Total 96.580 49 BI_N_CD Between Groups 12.444 1 12.444 5.428 .024 Within Groups 110.056 48 2.293 Total 122.500 49 BI_P_CD Between Groups 6.801 1 6.801 4.652 .036 Within Groups 70.179 48 1.462 Total 76.980 49 BI_N_PC Between Groups 11.830 1 11.830 5.246 .026 Within Groups 108.250 48 2.255 Total 120.080 49 BI_P_PC Between Groups 7.543 1 7.543 4.800 .033 Within Groups 75.437 48 1.572 Total 82.980 49 BI_N_HC Between Groups 11.231 1 11.231 4.974 .030 Within Groups 108.389 48 2.258 Total 119.620 49 BI_P_HC Between Groups 8.543 1 8.543 5.228 .027 Within Groups 78.437 48 1.634 Total 86.980 49 Rajkot Sum of Squares df Mean Square F Sig. Q_P_HC Between Groups 3.203 1 3.203 5.411 .024 Within Groups 28.417 48 .592 Total 31.620 49 Table 9b: Effect of marital status on attitude towards Private Label Brands (Descriptive) Baroda N Mean Std. Deviation Minimum Maximum P_N_CD Unmarried 14 5.21 .426 5 6 Married 36 4.58 .996 2 6 Total 50 4.76 .916 2 6 P_P_CD Unmarried 14 5.93 .730 5 7 Married 36 4.92 1.556 1 7 Total 50 5.20 1.443 1 7 P_N_PC Unmarried 14 5.36 .497 5 6 Married 36 4.56 .969 2 6 Total 50 4.78 .932 2 6 ISSN: 2249-9962 May|2012 www.ijbmt.com Page | 13

International Journal of Business and Management Tomorrow P_P_PC Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total Unmarried Married Total 14 36 50 14 36 50 14 36 50 14 36 50 14 36 50 14 36 50 14 36 50 14 36 50 14 36 50 N 20 30 50 5.93 .730 4.89 1.526 5.18 1.424 5.36 .497 4.56 1.054 4.78 .996 5.86 .770 4.97 1.521 5.22 1.404 4.50 1.787 5.61 1.400 5.30 1.581 4.43 1.505 5.25 1.079 5.02 1.253 4.50 1.787 5.58 1.381 5.28 1.565 4.36 1.646 5.22 1.072 4.98 1.301 4.50 1.787 5.56 1.382 5.26 1.562 4.36 1.646 5.28 1.111 5.02 1.332 Rajkot Mean Std. Deviation 6.05 .887 5.53 .681 5.74 .803 5 1 1 5 2 2 5 1 1 1 2 1 1 3 1 1 2 1 1 3 1 1 2 1 1 3 1 Minimum 5 5 5 7 7 7 6 6 6 7 7 7 7 7 7 6 7 7 7 7 7 6 7 7 7 7 7 6 7 7 Maximum 7 7 7

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P_N_HC

P_P_HC

BI_N_CD

BI_P_CD

BI_N_PC

BI_P_PC

BI_N_HC

BI_P_HC

Q_P_HC

Unmarried Married Total

7. Conclusion & Implications

In this study, we examined how customers in two selected cities of Gujarat perceive private label brands in three product categories in comparison to national label brands with respect to 5 attributes. Although inter category differences have been cited as the most important source of variation in PLB share across markets, retailers and categories (Dhar and Hoch, 1996), little prior consumer-level research has thus far been done to explain these crucial variations. Perception of quality is an important element relating to private-label brand use; if all brands in a category are seen as sharing a similar quality, then private-label brand use is often observed to increase (Richardson et al.1994). But as proven in this study and other global studies, one constant finding of private-label research had been that quality is more important than price to shoppers (Hoch and Banerji 1993; Sethuraman 1992). The findings of the study clearly bring forth the importance of pricing as an attribute in influencing customers acceptance of private label brands. This is so because todays customers are smart enough to understand that since they are not buying branded products so they need not pay premium. Support for this belief was challenged, however, by Ailawadi et al.(2001). Burton et al. (1998) pointed out that the danger for a retailer using low prices alone with which to compete is that some consumers may use price as a proxy for quality. Richardson et al.(1994) found that private-label brands were considered by shoppers to be inferior in quality terms to national brands. The present study offers an insight into customers attitude with private label brands across three product categories. In attempting to explain inter category variations in customers attitude towards private label brands, the effect of age, marital status as well as profession has been taken into consideration.

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Retailers should promote PLs by which it decreases the level of perceived risk while increase level perceived image of PL / store / retail outlet. As across all categories, attitude towards perceived risk as well as image was found to me unfavorable. Narasimhan and Wilcox (1998) argue that consumers will be less motivated to purchase private-label groceries if the level of perceived risk in that category is high. The findings of the study can be useful to retailers in formulating strategies to make products other than the national branded ones acceptable in the market, which will help retailers in developing stronger store/private label brands and in increasing their presence and acceptance amongst customers.

8. Limitations of the Study

The scope of this study is limited to a two cities of Gujarat & 3 merchandising categories & 5 attributes. The results and findings of the study are thus limited in their ability to be projected to the country or foreign countries & other categories. There is no denying the fact that because of socio-economic and cultural differences there is a variation in attitude of people.
Dr. Amit R. Pandya, Reader, Faculty Of Commerce Including Business Administration, The M. S. University Of Baroda, Vadodara Monarch A. Joshi*, Assistant Professor, Indu Management Institute, Vadodara

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