Response Strategies to Private Labels : Case Company: Henkel, Germany

Abstract

The aim of the thesis is to examine which strategy that the German consumer goods company, Henkel, can adopt in order to respond to private labels. Moreover, the thesis describes and explores a set of strategies that a national brand manufacturer can use to act towards private labels.

The thesis employs deductive approach and quantitative research method. Information and data in the thesis are collected from both primary and secondary sources. A survey is conducted with 102 German consumers in order to examine their buying habits for shampoos. The results from the survey are the primary source for the study. Secondary data is collected from books, journals, reports, articles and electronic sources.

The theoretical framework of the thesis is based on Hoch’s (1996) proposed strategies. Hoch’s strategies are put forward in order to help national manufacturers deal with the increase of private labels.

The study results show that Henkel should adopt the strategy of increasing distance from private labels. The strategy is chosen because it can improve brands’ perceived superiority and add value to consumers without harming manufacturer-retailer relationships and healthy competition.