Are they always promising? An empirical analysis of moderators influencing consumer preferences for economy and premium private labels

• Premium private labels are more promising for high-priced grocery stores
• Economy private labels are more promising for low-priced grocery stores.
• Premium private labels are more promising in categories of high brand relevance.
• Economy private labels are more promising in categories of low brand relevance.
• No moderating impact of the perceived producer of the private label.

The identification of conditions under which premium or economy private labels are more promising from a consumer perspective is of high managerial relevance. This paper is first to analyze the moderating impact of store-, category-, and private label-characteristics on consumer preferences for premium vs. economy private labels. The results reveal that premium (economy) private labels are more preferred at high-priced (low-priced) retailers and in categories of high (low) brand relevance. However, consumers' believes whether the private label is produced by a well-known manufacturer or the retailer itself do not moderate consumer preferences for premium vs. economy private labels.