Extrinsic and intrinsic cue effects on perceptions of store brand quality

Store brand grocery items are private label products that constitute a key weapon for retailers against manufacturers in the battle for consumer loyalty. While store brand goods are generally priced lower than national brands and come with quality gurantees, they only account for 14% of total supermarket sales. Consumer perceptions of store brand quality is hypothesized to be affected by both instrinsic and extrinsic cues. The importance of these cues relative to each other is examined using data from 1,564 buyers of five products. The results indicate that consumers' have a tendency to rely more on extrinsic than on intrinsic use when evaluating the quality of a store brand item. The success of national brand products rests on the development of a strong brand image as well as on intrinsic product quality. However, private labels can successfully compete with national brands through the development of a strong image and good product quality.