Examination of Factors Moderating the Success of Private Label Brands: A Study of the Packaged Food Market in China

ABSTRACT The major objective of this study is to explore how different determinants of perceived risk help explain variations in purchasing preferences for national brands versus private label brands (PLB) of the packaged food market in urban China. We selected the Chinese packaged food market because it is “one of the most rapidly fastest growing markets” in the world (Wu & Deng, 2002). Following a description of the Chinese market, we build our conceptual framework by combining the PLB literature with searching versus experience, price consciousness, and product quality literature. Using the data we collected in GuangZhou, Shenzhen, and Shanghai cities, we find both their direct and indirect effects. Supporting theory-based expectations, we find that (1) PLB purchase in a category increases when consumers perceive reduced consequences of making a mistake in brand choice in that category; (2) when that category has more “search” than “experience” characteristics; and (3) consumer's degree of price consci...