Private Label

Topics: Private label, Retailing, Brand Pages: 29 (10140 words) Published: July 21, 2010
Faculty Jaipuria Institute of Management, Lucknow

Dr. Reeti Agarwal
Faculty (Marketing), Jaipuria Institute of Management, Lucknow Article No: 180 Year:November 2009 ISSN 0974 – 9497 Volume 3, Issue 4/4

Abstract: Retail and real estate are the two booming sectors of India in the present times. Retail, one of India’s 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 taken up by Indian retailers to succeed in the retail business is to focus on private label brands. Retailers use private label brands to compete with the national brands by setting competitive price points. Determining customer perception towards private label brands is an essential part of a retailer’s marketing strategy formulation process. To gain this understanding in respect of Indian customers specially the youth of India, the study was conducted using the personal survey method on respondents taken from the northern part of India. The major findings of the study depict that though respondents on the whole prefer national label brands over private label brands, the preference pattern is significantly affected by the age and profession of respondents. Age and profession were also found to affect the preference pattern and satisfaction level of respondents in respect of private label brands in different categories of products. Key words: profession Private label brands, apparels, grocery, electronics, Indian youth perception, age,

INTRODUCTION 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 by AT Kearney's seventh annual Global Retail Development Index (GRDI), in 2008. The share of retail trade in the country's gross domestic product (GDP) was between 8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach 22 per cent by 2010. A McKinsey report 'The rise of Indian Consumer Market', estimates that the Indian consumer market is likely to grow four times by 2025. Commercial real estate services company, CB Richard

Ellis' findings state that India's retail market is currently valued at US$ 511 billion (Bang, 2009). Banks, capital goods, engineering, fast moving consumer goods (FMCG), software services, oil marketing, power, two-wheelers and telecom companies are leading the sales and profit growth of India Inc in the fourth quarter of 200809. India continues to be among the most attractive countries for global retailers. At US$ 511 billion in 2008, its retail market is larger than ever and drawing both global and local retailers. Foreign direct investment (FDI) inflows as on January 2009, in single-brand retail trading, stood at approximately US$ 1

25.18 million, according to the Department of Industrial Policy and Promotion (DIPP) ( According to the Investment commission of India, the overall retail market is expected to grow from US$ 262 billion to about US$ 1065 billion by 2016, with organised retail amounting to US$ 165 billion (approximately 15.5 per cent of total retail sales). India is expected to be among the top 5 retail markets in the world in 10 years. India's overall retail sector is expected to rise to US$ 833 billion by 2013 and to US$ 1.3 trillion by 2018, at a compound annual growth rate (CAGR) of 10 per cent. As an emerging market with high growth rates, consumer spending has risen sharply as the youth population (more than 33 percent of the country is below the age of 15) has seen a significant increase in its disposable income. Consumer spending rose an impressive 75 per cent in the past four years alone. Also, organised retail, which accounts for almost 5 per cent of the market, is expected to grow at a CAGR of 40 per cent from US$ 20 billion in 2007...

References: 17
Nelson, Phillip (1974)
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