Name Brand and Generic Brand Competition：An analysis of Generic Brand Strategy of Market and Channel Investment Portfolio
Date Issued
2013
Date
2013
Author(s)
Liou, Tyng-Yu
Abstract
In the diversified products market, the majority of products come in both name brands and generic brands. Name brand products are usually positioned with a high-quality and high-price value, while generic brand products are set with lower prices with lower quality. However, the quality and the service level of generic brand products have been improving recently so that generic brand products are getting more valuable to customers. At the same time, generic brands are competing with name brands more aggressively. In the competitive supply chain between these two brands, name brands usually make some vertical control to management the distribution channel but it has bring some limitations to retailers. Owing to the power of supply chain has shift from the supply end to the demand end, name brands’ vertical control come out with some problems. Therefore, generic brands can take these chances to compete with name brand more advantageous.
Therefore, this paper discusses the competitive investment strategy of generic brand. We assumed that generic brand makes market and channel investment and both two brands expect that the industry will carry out an allowance competition. According to these assumptions, we construct a competitive demand model for these two brands. Through the optimization process, an optimization program is constructed for optimizing generic brand’s strategy and analyzing the investment effects. Moreover, scenario analysis is done to discuss how the investment strategy will be adjusted if generic brands have different market power or face the multiple product types. According to the results of numerical analysis, we prove that the investment strategy will make a positive contribution to the generic brand but the competition of allowance is disadvantageous for both name brand and generic brand. When generic has a weak market power or is facing the product with high cross-elasticity, the effect of investment is more obvious.
Subjects
副廠牌
通路投資
市場投資
價格競爭需求模型
Type
thesis
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