From Store Brands to Store Brandscapes: The Emergence of a Time and Money Saving Heuristic

Abstract

Purpose: This research investigates role of store brands as a time and money saving heuristic in the context of an omnipresent store brand hierarchy. Drawing on the work of Tversky and Kahneman (1982) it proposes that the store brand hierarchy is characterised by many of the traits of frequently used heuristics employed by grocery shoppers. Design/methodology/approach: Based on Chaiken's (1980) model of information processing and Stigler's (1961) perspective on the economics of information search, the study deductively establishes a model of store brand proneness to reveal the role of store brands as time and money saving heuristic. The model is tested on a sample of 535 US households using structural equation modelling and subsequent multigroup analysis based on two subsamples of households experiencing high financial pressure but who differ in terms of time pressure Findings: The findings provide strong support for store brands as a time and money saving heuristic and as a substitute for price search among households experiencing financial and time pressures Research limitations/implications: The main limitation is that the study is based on a sample of households located in one region of the US market. Practical implications: Retailers need to be aware that any extension of the store brand portfolio beyond the traditional multi tiered price/quality hierarchy, risks undermining what has emerged to be a valuable heuristic used by certain shoppers. Originality/value: This study extends our understanding of the role of store brands in the marketplace by going beyond their conceptualisation as a competitive device used by retailers to instead position them as a decision-making tool used by consumers. It also deepens our understanding of the boundary between rational search activities and the transition to the use of frequently flawed heuristics within the shopping process.