Keywords

Retailing, Store Image, Store Brands, Consumer Purchase Behavior, Perceived Quality.

Introduction

Store brands, also known as private labels, are main stream in many markets where the products of respective stores sold through retailer’s private label/sellers store’s own name created by retailers (Kumar, 2007) and this becoming more popular recently across all product segments and verities particularly in developing markets and countries. Cosmetic retailers continuously updating their store brands to legitimate threats through their innovation and creativity by modifying their store brand packaging and labels to grab more/existing customers to satisfy their perception level since their expectation levels are more and willing to try better features and aesthetic look cosmetic product lines for longer sustainability. Plenty of research studies have been undertaken by various researchers across the world made on store brands and customer perception and found out most of the manufacturers store brands quality gap decrease constantly and requires quality improvements (Apelbaum et al., 2003). It is important for every firm to continuously improve quality which is considered as utmost priority on their store brands with affordable prices which allow their channel partners (manufacturer-wholesaler-retailers) to stay competitive within industry to deliver quality services to their customers (Baltas, 1997).

Retailers who manage their image effectively can influence consumers’ store patronage decisions and improve their competitive situation. Most of the retail store brand retailers to look for sustainability in their industry marketplace developing and adding more positive store image to acquire customer feedback positively and also allow them to improvise and increase their customer base and traffic through their existing store brand loyalty programs.

Store managers/retailers developing more strategic advantage measures by analyzing store brand dimensions which are more beneficial to their customers to generate positive outcomes on their store brand quality criteria’s. Also store brand managers investing in multiple dimensions, to gain advantage of store image on the one hand and on the other hand to transfer their positive image to their cosmetic products to perceive high quality on behalf their competitors for longer survival both for national and global brands. All store brand cannot be successful in all their cosmetic products they have on-par with some brands and far-behind in other categories because of differentiated promotional methods their packaging appearances and package design.

Many questions may arise in this topic and one of the important questions raised among store brand retailers/managers to be analyzed much is how well customer perceived quality on cosmetic products plays an important role in store brand proneness. Customer preferences over cosmetic store brands differ between HPQ vs LPQ based on segmentation variables which is both retailer-based and customer-based on factors such as store brand price, image and inbuilt confidence on respective store brands which is basically decided as major customer perceived value characteristics and purchasing intention on cosmetic store brand categories.

This study analyzed the results in two categories. First, the study measure customer purchasing intention, perceived value and intentional value in their minds regarding cosmetic store brands. Next a conceptual model has been developed among multi segment consumer group to analyze customer perceived intention and perceived quality either HPQ or LPQ.

Research Questions

1. Whether recent hypermarket’s store image affects the perceived quality both HPQ and LPQ on cosmetic store brands?

2. How to generate customer maximum attainment of benefits for their perceived quality of cosmetic store brands?

3. Whether cosmetic store brands’ quality affects customer purchasing behavior?

4. Whether store image dimensions affects customer store brand purchasing behavior?

The above research questions provides retailers with preliminary answers to questions and contributes to literature in cosmetic retailing since there are limited number of an empirical study which investigates the links between store image dimensions and perceived quality both on high and low cosmetic store brands.

Literature Review

The literature papers discussed here in this topic help the researcher to identify potential role of cosmetic store image and formation of store brands perceived quality between HPQ and LPQ. Moreover, investigation of perceived quality’s effect on the customers’ cosmetic store brand purchasing behavior between HPQ and LPQ store brands, retailers may decide to implement different marketing tactics/strategies to improvise their business operations based on different groups of consumers.

According to a survey undertaken as on Mid December 2018 in developed Asia Pacific markets in Australia, cosmetic store brands enjoy 42% share of sales. Within the same region cosmetic modern trade offers fewer store brands. All store brands follow Western retailers’ style strategy when they enter any market and especially local retailers in western region quickly follow and suit with their own store brand lines. Carrefour a great example in Thailand Carrefour recently launched an ad campaign exclusively featuring store brands.

The store brand uptake in Latin America is accelerating thanks to constantly improving quality, expansion into additional categories, store formats focusing on store brands, wider assortment, active promotion, advertising support, favorable store images, better store brand management and overall value delivered to the consumer. That rate of uptake varies by country, with a low 1% market share to a high 8% share in more developed markets. In Colombia, store brands grew 125% faster than manufacturer brands (27.3% store brand growth vs. 11.8% manufacturer growth from 2007 to 2008). In Chile, store brand growth outperformed overall product basket (26% vs 14.6%). Some nations like Brazil and Venezuela lagged with a more passive trend.

Martineau (1958) defined how a shopper mindset defining and setting up their store brand and image by establishing both on functional qualities and psychological attributes to attract customer to make perceived value on store image. For James et al. (1976) store image is “A set of attitudes based upon evaluation of hose store attributes deemed important by consumers.” Parallel to this view, Engel and Blackwell (Mazursky & Jacoby, 1986; Fitzell, 1992; Hoch et al., 1994) defined store image as “One type of attitude, measured across a number of dimensions hopefully reflecting salient attributes.” On the basis of an extensive literature review, we have decided to adopt the conceptualization of Bloemer & Ruyter (1998) who defined store image as “The complex of a consumer's perceptions of a store on different (salient) attributes.”

In order to maintain and enhance their position under today’s tough competition environment, retailers can use store image as a strategic tool, which has a positive effect on profitability and store performance (Hartman & Spiro, 2005; Raju et al., 1995). Additionally, store image can increase the customers’ likelihood to shop in the store again (Hu & Jasper, 2007; Hoch & Banerji, 1993), length of stay in the store and quantity of purchase (Jacoby et al., 1985).

In the marketing literature investigated there are some little differences among authors with respect to dimensions of store image. The store image attributes applied in this study is adapted from the related literature (Lindquist, 1974; McDougall & Fry, 1974; Jain & Etgar, 1977; Mazursky & Jacoby, 1986; Ghosh, 1990; Richardson et al., 1994; Grewal et al., 1998; Bloemer & Ruyter, 1998; Batra & Sinha, 2000; Sirgy & Samli 1985; Collins-Dodd & Lindley, 2003; Arnold et al., 1983; Dhar & Hoch, 1997). Store image dimensions commonly mentioned by those studies are product variety, products’ quality, prices, store atmosphere, employee service and location/convenience.

For example all U.S., retailer store brand product guarantees parity with national brands on the quality criteria. Kroger stands as a store brand market leader, with roughly one-third of units sold being store brands. Safeway is a standout with its O Organic and Eating Right lines a presence so strong the company is looking to license its store brand offerings to other retailers. Fully 80% of Aldi sales comprise store brands. At Save-A-Lot, store brands account for 70% of sales. Costco-another strong store brand banner has ventured into expensive categories like wine and in certain categories like nuts, only offers private label.

The Table 1 below details the recent market-share growth of private-label/store-brand goods within the cosmetic consumer-packaged-goods (CPG) universe.

Table 1 Market-Share Growth of Private-Label/Store-Brand Goods within the Cosmetic Consumer-Packaged-Goods (CPG) Universe
Trends	Q1-18	Q2–18	Q3–18	Q4–18	Q1–19	Q2-19	Q1-20	Q2-20
Cosmetic Private-label unit share	31.2%	30.9%	31.2%	31.6%	31.2%	31.8%	32.3%	32.6%
Cosmetic Private-label $ share	19.1%	19.0%	19.5%	19.8%	19.8%	18.0%	18.4%	18.5%
US unemployment rate	5.4%	5.6%	5.7%	5.9%	6.1%	6.6%	7.2%	8.2%

Yes, the trend did continue in 2018. Unit and dollar share reached 32.6% and 18.5%, respectively, for the 52 weeks ending July 20 for cosmetic products.

Over the periods store brands and image of cosmetic products became a major driving force for cosmetic retailers and to be considered as unprecedented future growth especially both low / high market conditions. The greater reasons if we analyze for this continued success due to growing economy and developments of technological online base tools which promote greater value for cosmetic brands among customer segments. Especially online cosmetic retailers finding out better strategies by applying business intelligence solutions in strategic development approaches in assorting variety of comparative, qualitative offering of cosmetic products to their customers on their store brand shelves.

Research Methodology

H1: Consumers’ perceptions about merchandise variety affect the perceived high-and low-quality cosmetic store brands.

H2: Consumers’ perceptions about merchandise quality affect the perceived high and low quality of cosmetic store brands.

With respect to above mentioned hypothesis, fixing the prices either low / high in cosmetic retailer/supermarkets do not have much impact on consumer attitudes towards cosmetic store brands apart from pricing product specific nature criteria on quality perceptions. Cosmetic product’s price solely is an indicator of perceived quality whereas price level in the store is not. Because of the difference in price and store brand quality we do not able to hypothesize effect of cosmetic price dimension of store image on perceived cosmetic store brands quality.

H3: Consumers’ perceptions about the service affect the perceived quality of cosmetic store brands.

According to environmental psychology, to influence more customer response on cosmetic store brands shoppers establishing positive impact to their customers by improvising their based on environmental factors such as overall cleanliness, music, color, interior design, music, store layout, lighting, etc. The intention of the shopper may believe that the store brand create positively featured store which includes creative layout, modern fixture, wide aisles and cleaner environment may have good quality. It is found store atmosphere have a positive influence on store brands’ quality. In addition, showed that store brand quality was perceived as higher in an aesthetically attractive store than in an aesthetically unattractive one.

H4: Consumers’ perceptions about the store atmosphere affect the perceived quality of cosmetic store brands.

The reasons for recent success and popularization of cosmetic store brands and quality changing buying habits of consumers are becoming more popular nowadays; the reason for this was stated as the quality of store brands. This may be related to the consumer buying habits. Recently customer perception about a respective cosmetic store brand is all about amount of money spent on the product is our best product in nature. It is also reported that perceived quality and perceived value for cost affects not only brand purchase but also the willingness to pay a price premium. We think that non-buyers and rarely buyers of store brands are more cautious or biased against the quality of store brands compared to frequent users. Because of specific portion of consumers due to less awareness towards cosmetic store brands create lower perception quality of cosmetic products because of perceived store brands as lower quality products than frequent buyers.

H5: The perceived quality of cosmetic store brands affects cosmetic store brand purchasing frequency.

It is found a link between store image and intention to purchase a product. Customer purchase intentions discussed in the literature review papers shown as a predictor for subsequent purchase behavior. It also suggested that consumers while shopping for groceries are influenced by store image.

H6: Customer store image affects customers’ store brand purchasing frequency.

Marketing literature has revealed that very little is known about the differences in factors affecting consumers’ cosmetic brand choice and non-cosmetic brand choice for store brands. In this study, store image’s effect on store branded products’ perceived quality and consumers purchasing frequency are also investigated in the context of cosmetic and non-cosmetic categories.

Questionnaire Design

The measuring tool for store image was a self-administered questionnaire containing 16 items. The measuring scale used was a 5-point Likert scale as (strongly disagree and 5 strongly agree. The items considered evaluate the following factors: merchandise variety (4 items) merchandise quality (2 items), store atmosphere (9 items), and service (4 items). Those items were adapted from previous store image studies.

A five-point Likert scale utilized to measure store image, using a 5-point Likert scale ranging from 1 (strongly disagree) to 5 (strongly agree). In addition, perceived quality of store brands (Compared to other brands of (product), (brand name) is of very high quality, purchasing frequency of store brands (how often -never, rarely, sometimes, often, and always- do you buy this hypermarket’s store branded products, product category of the purchased store brand (food, non-food), and socio-demographic variables (age, gender, education, income) are also considered in the questionnaire.

Sampling

The questionnaire has been administered by face-to-face on a sample of 378 cosmetic store brand consumers interviewed between August 2021 and December 2021. Nowadays in all metro cities there are an increasing number of cosmetic brand stores especially in malls and hypermarkets and competition among them has never been so strong. As a result, it becomes harder for cosmetic retailers to attract consumers to differentiate their store image from others which in turn may affect their store brands’ perceived quality. The respondents were selected at random and surveyed after they had finished their shopping in hypermarkets for by following standardized protocols due to Covid pandemic. Most of the respondents accepted to participate are average income earner and university college students 61% of them are women. Table 2 provides the demographic profile of the sample in detail. Distribution of the consumers according to the usage rate of store brands is as follows: 22% of respondents are non-buyers, 26% rarely buyers, 36% sometimes buyers, 15% often buyers and 0.8% of the participants always buy store brands. In addition, 27% of participants’ buy cosmetic store brands preferences towards category products like skin-care, health-care, color cosmetics, personal care products etc. whereas 54% of them prefer non-cosmetic categories (detergents, cleaning materials etc.) category.

Table 2 Demographic Profile of the Sample
Demographic variables	Frequency (n)	Percentage (%)	Demographic variables	Frequency (n)	Percentage (%)
Gender			Income Level
Female	232	61.4	High	71	18.8
Male	146	38.6	Medium	307	81.2
Age			Education Level
20-29	49	13.1	High School	117	30.9
30-39	150	40.3	Undergraduate	152	40.2
40-49	104	27.8	Graduate	109	28.9
50+	75

Analysis and Findings

Stepwise principal component factor analysis was applied to identify factors (KMO: 0.816; 2271.701, d.f. 171, sig.000). The factors identified as store atmosphere, merchandise variety, service, layout, merchandise quality. Three items are excluded from the analysis based on low communality values (<0.50). Their factor loadings and cronbach alpha coefficients showing their reliability are given in Table 3. Although store layout is regarded as a component in store atmosphere, according to factor analysis results, layout is perceived as a separate factor.

Table 3 The Reliability of the Store Image Factors
Store Image variables	Store Atmosphere ( = 0.71)	Merchandise Variety (=0.78)	Service (=0.73)	Layout (=0.71)	Merchandise Quality (=0.65)
Point-of-sale system attracts me	0.763
Colors, contrast, elegant lighting, and symmetry attracts me	0.667
Up-beat music system played within the store	0.653
Overall temperature within the store	0.602
Variety, Uniqueness and product availability		0.828
Value of money paying for my goods		0.765
Complexity in finding products		0.695
Alternative product varieties		0.691
Employees are helpful			0.738
Knowledge of store personnel			0.714
Less problems in product returnability			0.702
Sales promotion are attractive			0.634
Excited by floor plan of store brand store				0.638
Shelf and Rack Design				0.588
Products are fresh					0.814
Satisfaction of product purchase					0.790

So hypothesis 4 should be divided into two as;

H4a: Consumers’ perceptions about cosmetic store atmosphere affecting the perceived quality of store brands.

H4b: Consumers’ perceptions about cosmetic store layout affect the perceived quality of store brands.

In order to get a profile of the data correlation matrices are listed in Table 4. Most of the variables are significantly correlated, stating that the store image variables which hypothesized to affect the perceived quality of store brands and store brand purchasing frequency are related.

Table 4 Data Correlation Matrices
	SD	Mean	1	2	3	4	5	6	7
Store brand purchasing frequency	2.47	1.02	1.00
Store brands perceived quality	3.30	1.09	0.496*	1.00
Store atmosphere	3.69	0.77	0.115*	0.235**	1.00
Merchandise variety	4.35	0.68	-0.227	0.115*	0.331**	1.00
Service	4.02	0.76	0.121*	0.150**	0.428**	0.261**	1.00
Layout	4.00	0.97	0.122*	0.198*	0.504**	0.333**	0.368**	1.00
Merchandize quality	4.21	0.87	0.018	0.131*	0.266**	0.251**	0.229**	0.335**	1.00

Regression analysis is performed to test the hypothesis. Perceived quality of store brands is regressed on the store image factors store atmosphere, merchandise variety, service, layout, merchandise quality. The results of the regression are given in Table 5. Regression parameters confirmed that store atmosphere affects the perceived quality of store brands. The more highly a consumer thinks of a store atmosphere the more positively she/he will evaluate store brands. H₁ H₂ and H₃ are therefore not supported by the data.

Table 5 Results of the Regression
Variables	Adj. R2 = 0.055		N = 378
	(B)	t
Constant	1.525	3.395	0.001
Store atmosphere	0.227	2.541	0.011
Merchandize variety	0.022	0.241	0.809
Service	0.052	0.630	0.529
Layout	0.096	1.372	0.171
Merchandise quality	0.059	0.851	0.395

To investigate the effects of perceived quality of store brands and store image on store brand purchasing frequency regression analysis is performed. Perceived quality of store brands is found to affect store brand purchasing frequency whereas store image does not Table 6. Hence, it can be concluded that consumers store brand quality perceptions about the store brands influence consumers store brands purchasing behavior in a positive sense and H₅ is supported. On the other hand store image has no effect on the consumers store brand purchasing behavior and H₆ is rejected Table 7.

Table 6 Regression Analysis Results for Store Brand Purchasing Frequency
Variables	Adj. R2 = 0.055		N = 378
	(B)	t
Constant	0.987	6.793	0.000
Perceived quality of store brands	0.457	10.953	0.000

Table 7 Hypothesis and their Status are Summarized
Hypothesis	Status
H1:Consumers’ perceptions about merchandise variety affect the perceived high-and low-quality cosmetic store brands.	Not supported
H2: Consumers’ perceptions about merchandise quality affect the perceived high and low quality of cosmetic store brands	Not supported
H3: Consumers’ perceptions about the service affect the perceived quality of cosmetic store brands.	Not supported
H4a: Consumers’ perceptions about cosmetic store atmosphere affecting the perceived quality of store brands.	Supported
H4b: Consumers’ perceptions about cosmetic store layout affect the perceived quality of store brands.	Not supported
H5: The perceived quality of cosmetic store brands affects cosmetic store brand purchasing frequency.	Supported
H6: Store image affects customers’ store brand purchasing frequency.	Not supported

Other findings of this study are about the consumers’ perceptions about the category variances. In cosmetic product category the effect of store image on the perceived quality of store brands is found to be statistically not significant. On the other hand, in non-cosmetic category, perceived quality of these products are affected by store atmosphere dimension of store image (R₂=0.094; β=0.340; p<0.001). In addition, in cosmetic category, store brand purchasing frequency is affected by the perceived quality of store brands (R₂=0.082; β=0.236; p<0.01). In non-cosmetic category, store brand purchasing frequency is also affected by the perceived quality of store brands (R₂=0.100; β=0.251; p<0.001).

Other Findings from this Study

From the study it was found that 54% say that the Covid pandemic recession is an “important” factor in purchasing decisions, with 32% responding that it is “very important.” 35% of respondents have tried private label brand products in categories where they previously purchased name-brand products. More than 30%of respondents said that they are buying more private label brand products than they did a year ago. Sales of cosmetic store brands surged more than 25% in 2019 to a record $83.3 billion due to Covid’19 pandemic. Items with the biggest gap, between 50-60 percent: talcum powder, conditioners, facial makeup, body lotion and shampoo. Consumers want to save money without sacrificing quality. They are trying store brand products, keeping the costlier items on the shelves. Shoppers are more apt to grab the grocery brand over the bigger ticket products that used to fill the pantry. Specific consumer characteristics are associated with interpersonal differences in store brand demand.

Conclusion

From an academic viewpoint, this study contribute by illustrating that store image is a major strategic tool in the highly competitive retailing environment. Indeed, this research shows that the store image-and more particularly the store atmosphere-influences perceived quality of store brands. It is concluded that positive customers’ perceptions of store atmosphere creates positive perception towards cosmetic store brands. Moreover, consumers’ perception about the quality of store brands is found to have an influence on their store brand purchasing frequency. As consumers perceive store brands of quality, they purchase those products more frequently. In addition to these findings, store image does not affect store brands perceived quality and perceived quality of store brands affects purchasing behavior in food category.

This paper shows the relevance of the implementation of strategies oriented to store image improvements. On our sample, it was shown that investments in store atmosphere could have a positive impact on consumers’ perceptions about store brands quality. Retailers should therefore implement other marketing decisions than store image to attract new buyers of store brands, such as if possible “trial of store brands in the store” which was found to benefit the perceived quality of store brands positively. In addition, in order to reduce the functional risk perceived by the consumers, retailers can put more information on the store brands’ package about their ingredients and performance. Although these strategies may affect the cost and in turn the prices of the store brands, these may increase the customers’ likelihood of purchasing the store brands who does not buy just because of lower prices.

Limitations and Suggestions for Future Research

A key limitation of this research is the measurement of perceived quality of store brands with related cosmetic items. Intrinsic (i.e. product performance, taste, smell) and extrinsic cues (package, price, and brand name) could have been measured. The store dimensions and images may have options for further evaluations based on perceived quality in addition to intrinsic and extrinsic cues such as customer profile, involvement of the store in community programs, store’s attractiveness, and customers’ general attitude etc. This study may be extended to larger sample size with differentiated demographic variables and other levels. Since the study may also be replicated by developing further by future researchers by undertaking cross-cultural research by focusing cosmetic store brands products even in convenience stores, supermarkets and specialty stores. Furthermore web-based stores’ image and its influence on its store brands can be evaluated. Moderating role of perceived quality of store brands on the relationship between store image and store brand purchasing frequency may be investigated for future research.

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Received: 10-May-2022, Manuscript No. BSJ-22-12004; Editor assigned: 12-May-2022, PreQC No. BSJ-22-12004(PQ); Reviewed: 26-May-2022, QC No. BSJ-22-12004; Revised: 30-May-2022, Manuscript No. BSJ-22-12004(R); Published: 06-Jun-2022