What is Consumer Packaged Goods (CPG)

Many national brands adopt innovation strategies based on frequent launches of new products to defend and grow market shares against private labels. However, retailers imitate the novelties of national brand new products very fast. One of the key questions to assess the effectiveness of national brands' product innovation is to get a deeper understanding of how consumers react in terms of choice when faced with a national brand new product and a me-too private label product. In particular this research explores the effects of consumer innovativeness and risk aversion on this choice in five European countries and the United States. Results show that consumers with higher innovativeness prefer national brands. However, there are significant differences among countries depending on their uncertainty avoidance and risk aversion.