Retailer premium own‐brands: creating customer loyalty through own‐brand products advantage

The purpose of this paper is to propose a theoretical model which investigates antecedents, consequences, and contingency factors of retailer own‐brand product advantage. The paper develops propositions and managerial implications.

It summarizes an empirical work related to the key constructs of the theoretical model and identifies gaps in the literature. The paper provides definitions of each antecedent and outcome of retailer own product advantage and discusses managerial implications of the proposed framework.

Retailers who have higher degree of customer participation, innovation, and brand orientations are likely to have a stronger own‐brand product advantage. In turn, those retailers are more likely to have loyal customers and superior own‐brand financial performance. These relationships will be influenced by retailer image, market power, number of national brands and category size, technology complexity, and competitive intensity.

Understanding the key outcomes of own‐brand product advantage will facilitate management's evaluation of current retail product development strategies. If outcomes of the current own‐brand strategy are not satisfactory, an assessment of customer participation, innovation, and brand orientation effectiveness may be warranted.

The authors are the first to define a retailer premium own‐brand. Based on the theory of resource‐based view, it is proposed a new theoretical framework that pinpoints three business orientations as antecedents of and customer loyalty and brand performance as consequences of retailer own‐brand product advantage. The framework also suggests some contingency factors at retailer, category, and market levels.