Knowledge that Transforms

The growth of private labels over the past decades has been attributed to various factors. This article formally addresses the link between private-label success and economic expansions and contractions using recently developed time-series/econometric techniques. The findings confirm conventional wisdom that a country's private-label share increases when the economy is suffering and shrinks when the economy is flourishing. However, asymmetries are found in the extent to and speed with which private-label share changes in cyclical up- versus downturns. Consumers switch more extensively to store brands during bad economic times than they switch back to national brands in a subsequent recovery. In addition, the switch to private-label brands is faster than the opposite movement to national brands after the recession ends. Finally, not only are consumers more prone to buy private labels during economic downturns, but some keep buying them when bad economic times are long over as well, leaving permanent "scars" on national brands' performance level. The authors argue that national-brand manufacturers can mitigate the effect of an economic downturn on their shares by intensifying their marketing-support activities in recessions. Such a proactive strategy is not often observed. On the contrary, available evidence suggests that many manufacturers exacerbate their predicament by cutting back on their marketing expenses when the economy turns sour. Most retailers invest more strongly in their private-label program when the economy deteriorates, making it even more difficult for national brands to catch up with the share lost during contractions.

A large number of visualization tools have been created to help decision makers understand increasingly rich databases of product, customer, sales force, and other types of marketing information. This article presents a framework for thinking about how visual representations are likely to affect the decision processes or tasks that marketing managers and consumers commonly face, particularly those that involve the analysis or synthesis of substantial amounts of data. From this framework, the authors derive a set of testable propositions that serve as an agenda for further research. Although visual representations are likely to improve marketing manager efficiency, offer new insights, and increase customer satisfaction and loyalty, they may also bias decisions by focusing attention on a limited set of alternatives, increasing the salience and evaluability of less diagnostic information, and encouraging inaccurate comparisons. Given this, marketing managers are advised to subject insights from visual representations to more formal analysis.