Purpose – The hottest trend in retailing is the emergence of “premium” store brands. Though store brands are treated as important players in grocery store strategies, many retailers prefer price over quality and often prefer to invest in store promotion, while neglecting brand advertising. This paper’s aims are to propose a conceptual framework, integrating advertising-related psychographic factors which will be empirically tested.
Design/methodology/approach – Data were collected through a survey of 206 participants randomly recruited among adult grocery shoppers. The study employs a factor analysis method following path analysis using AMOS 17 and structural equation modeling (SEM), based on the maximum likelihood approach.
Findings – The results show the salience of creating a strong and sustainable store brand through advertising and innovation. A store brand’s perceived quality was found to be the most important factor in predicting store brand purchase intention, and advertising was found to have an indirect effect on perceived quality, shaped through extrinsic cues and novelty lovers’ tendency variables.
Practical implications – Retailers are advised to change their promotional budget’s allocation. Along with their in-store promotions, retailers should invest more heavily in advertising their store brand and offering innovation, in order to build a strong and sustainable brand. The costs of advertising could be compensated by a growth of the total store sales and the store’s gross margin.
Originality/value – The originality of this study lies in the conceptual framework proposed to examine the importance of building a strong store brand through advertising and innovation from a psychographic point of view.