Private labels versus national brands: The effects of branding on sensory perceptions and purchase intentions Patricia Rossi a,n , Adilson Borges b , Marat Bakpayev b a IESEG School of Management, Catholic University of Lille, 3 rue de la Digue, 59000 Lille, France b NEOMA Business School, 59 rue Pierre Taittinger, 51100 Reims, France article info Article history: Received 6 February 2015 Received in revised form 12 July 2015 Accepted 12 July 2015 Keywords: Branding National brands Private labels Purchase intentions Sensory perception abstract Consumers increasingly consider private labels to be as good as national brands. This research raises the question of whether national brands and private labels equally affect consumers’ sensory perceptions and purchase intentions. The results of two studies show that consumers reverse their evaluation of private labels (vs. national brands) when tasting the product in an informed (vs. blind) condition. When consumers are not aware of brand names, they indicate better taste and higher purchase intentions for private labels. However, the opposite is true when they try products in an informed condition. We discuss the implications for private labels and national brands. & 2015 Elsevier Ltd. All rights reserved. 1. Introduction It is important for managers to know how to position a private label 1 vis-a-vis national brands (Hoch, 1996). Today, this question remains relevant particularly because private labels are growing in quality and adopting different positions to serve different market segments (Geyskens et al., 2010; Liu and Wang, 2008). Past work suggested that the best positioning strategy for a private label depends on how it competes with national brands and its own quality level (Choi and Coughlan, 2006). Given the fact that some private labels can objectively be of better quality than national brands (Sethuraman and Gielens, 2014), especially premium pri- vate labels (Braak et al., 2014; Geyskens et al., 2010), the compe- tition between private labels and national brands remains an im- portant subject for research. Historically, private labels represented lower-price, lower- quality options than competing national brands (Fitzell, 1982; Goldsmith et al., 2010). However, recent industry studies show that consumer perceptions of private labels have changed over the years. For example, nine out of ten American consumers consider private labels to be as good as national brands (Deloitte, 2014). In the United Kingdom, almost half of consumers believe that private labels and national brands are produced in the same factories with different packaging, and 59% of consumers believe that private labels are more expensive only because of advertising costs and not as a result of better raw materials (Euromonitor International, 2014). In addition, the latest market share data show that private labels continue to spread in popularity across Europe and account for at least 30% of all products sold in 15 countries, the highest figure yet (PLMA, 2014). Although consumers claim they make food choices based on product quality and taste, extrinsic cues, such as product brand, strongly impact their perceptions and decisions (Dotson et al., 2012). For example, extant research shows that brand name plays a major role in product evaluation, driving expectations about performance and quality (Poulsen et al., 1996). In addition, brands cause consumers to perceive better taste, and in blind versus in- formed conditions, they evaluate the same products differently (Fornerino and d’Hautville, 2010; McClure et al., 2004). Consumers now have favorable perceptions of private labels (Nielsen, 2014). The fact that they acknowledge private labels to be high-quality products (Deloitte, 2014; Euromonitor International, 2014) raises the question of whether product brands (national brands versus private labels) influence consumers’ inferences re- garding product quality. Do consumers still view national brands Contents lists available at ScienceDirect journal homepage: www.elsevier.com/locate/jretconser Journal of Retailing and Consumer Services http://dx.doi.org/10.1016/j.jretconser.2015.07.006 0969-6989/& 2015 Elsevier Ltd. All rights reserved. n Corresponding author. E-mail addresses: p.rossi@ieseg.fr (P. Rossi), adilson.borges@neoma-bs.fr (A. Borges), marat.bakpayev@neoma-bs.fr (M. Bakpayev). 1 In the literature, private labels are defined as products sold under a retailer’s own name or a different name created exclusively by the retailer; whereas national brands are manufacturer brands (Boyle and Lathrop, 2013; Geyskens et al., 2010; Goldsmith et al., 2010; Huang and Huddleston, 2009; Olbrich and Grewe; 2013; Steenkamp et al., 2010). Journal of Retailing and Consumer Services 27 (2015) 74–79