A Theoretical and Empirical Investigation of Economic Recession Effects on Consumer Perceptions of Private Label Products

The global economic crisis of 2008 was a phenomenon that had a huge impact on the economy of many large and smaller countries, such as Greece. The significant gradual deterioration of the Greek economy and the deep economic recession that took place in the last years negatively influenced the Greek companies. The main characteristics of the recession were the reduced turnover and profitability in several sectors of financial activities. In the meantime, thousands of businesses have closed during the last years and a large percentage of the population is currently unemployed. The object of the present study is the analysis of the economic recession phenomenon in Greece, in accordance with its impact on the field of domestic retail and in the supermarket sector in particular. The main purpose of the study is to investigate whether the economic recession has influenced the perception and the buying behavior of the consumers regarding private label products. In order to achieve the aforementioned aim, a field study was conducted with the use of a questionnaire, which was addressed to consumers – clients of supermarkets. 120 valid questionnaires were collected in total, and the major conclusion that was drawn from the study was that private label products showcase significant growth and greatly influence consumers' buying habits, thus, winning their preference. In general, consumers seem to be quite satisfied with private label products and they greatly prefer them, especially in product categories that are not directly related to their health (e.g. stationary products). On the other hand, consumers seem more reluctant to choose private label products when it comes to more “sensitive” product categories (e.g. dairy products). Last but not least, it seems nowadays that consumers discount their desires and choose to buy a particular product, initially based on its price and then by examining the other common selection criteria, like the quality, the packaging and the reputation of the product. This fact certainly benefits the demand for private label over branded products