The dairy industry has an important position in the food industry of the Slovak Republic, as it accounts for 18% of its total production and sales. Like production, sales are mostly influenced by the evolution of raw cow's milk prices on both, European and world markets. Prices had a significant impact on the industry in 2009 – 2010, as there were observed sharp fluctuations – while 2009 brought to the dairy sector a profit of 2.8 million €; in 2010, it showed a loss of 7.3 mil. €. The following years did not bring any change and it can be said that the sector is loss-making (MPRV SR, 2018).

The average purchase price of raw cow's milk was the lowest in 2009 when it was around 20.82 €/100 kg. The highest price was reached in 2014, at 33.82 €/100 kg. While the development of average purchase prices of raw cow's milk excluding VAT is in the graphical form shown in Figure 1, Figure 2 shows the production of milk and dairy products in the Slovak Republic.

The raw cow's milk production showed a fluctuating trend over the considered period between 2009 and 2019. The highest production was achieved in 2012 at the level of 959.4 thous. t. On the contrary, the lowest milk production was in 2010, namely 918 thous. t.

Despite the fact that milk and dairy products take an irreplaceable place in everyday food consumption, especially because the milk is a complex food, what is confirmed by its nutritional content, vitamins, magnesium, and iron, which are indispensable in the daily diet (Nicklas et al., 2009). Some ingredients are included in milk in a higher amount, others in a more convenient form to be used by the organism.

At the forefront of this, it is calcium that is bound in milk in organic compounds and therefore can be easily used by the growing organism (The National Dairy Council, 2008), nowadays dairy companies are struggling with low milk and dairy consumption – as can be seen from the Figure 3, the consumption of milk and dairy products per capita peaked at 176.2 kg in 2016 and have been rather negative since then.

According to the results of several researches (e.g. Kubicová and Habánová, 2012; Krivošíková et al., 2019; Kubicová et al., 2019, etc.), the low consumption of milk and dairy products is caused mainly by poor eating habits of consumers and, last but not least, insufficient promotion of these products. Lower consumption of milk and dairy products adversely affects human health, as they contain many vitamins and minerals that have a beneficial effect on health.

The submitted paper deals with the issue of private labels in the segment of milk and dairy products, where we have focused on a selected group of customers, namely millennials. Our research aims to show how private labels function as an alternative to the purchase and which elements do have an influence in the case of a specific group of customers, so-called millennials.

Millennials, also known as Generation Y or Millennial generation are those born after 1980 and the first generation to come of age in the new millennium (Polakevičová and Uhríková, 2015).

This paper aimed to find out how Slovak millennials perceive private labels, in which categories they buy them, what motivates them and on the contrary, discourages them from the purchase, etc. An anonymous questionnaire survey was chosen as the main research method, in which a total of 549 respondents from all over Slovakia have participated (the sample of respondents can be considered as representative on the 95% confidence level and 5% error margin as n ≥384).

As it can be seen in Table 1, the majority of our respondents was represented by women (66.3% of respondents), students (67.94% of respondents), respondents with the first degree of higher education (39.2% of respondents), households with net family income over 1.501 € (25.87% of respondents) and city residents (62.84% of respondents).

The questionnaire survey consisted of a total of 16 questions formulated as closed ones with the possibility of one, respectively multiple responses, and four open questions where respondents were free to express their opinion and six classification questions.

As the second research method, there was used the method of blind test, which was involved by 15 respondents from our focus group. In this test, respondents were offered to taste four samples of parenica – a traditional Slovak cheese as follows: one sample of a traditional brand, two samples of private labels, and one sample produced by a reeve. In this test, our respondents were asked to evaluate on a scale of 1 to 5, with 1 being the best and 5 the worst, the color, flavor, fragrance, and consistency of the given samples. Table 2 provides a more detailed overview of the examined parenica samples.

Nielsen's recent global Consumer Confidence Index reports (2018) proved that there is a new retail revolution underway, and it’s going to affect the food industry across the globe over the next five years in ways we have never seen before by the development of private-label products and the new challenges that this will present for brands and manufacturers across the globe, as retailers develop and market their products rather multinational name brands to meet changing consumer needs (Herstein and Gamliel, 2004; Smith and Bashaw, 2009; Kakkos et al., 2015).

Private label brands, also known as “store brands” or “distributor brands”, were considered low-price, low-quality products several decades ago; currently, however, they represent a clear alternative to manufacturer brands (Kapferer, 2008). They account for more than 40% of the market in six European countries (Private Label Manufacturers Association [PLMA], 2015). In general, private labels refer to brands owned by the retailer or distributor and sold only in its stores (Kumar and Steenkamp, 2007). Conversely, manufacturer brands are brands owned by manufacturers to commercialize them.

Private labels are not new in the market, as firstly occurred at the end of the 19th century, (Nagyová and Košičiarová, 2014). Nowadays, in a highly competitive environment, the private label products represent a suitable and perfect way of addressing new potential customers (Polakevičová, 2015; Džupina et al., 2016; Mach et al., 2018; Lorincová et al., 2018; Balcarová et al., 2014).

Consumers are currently in an increasingly competitive and dynamic market environment (Mach et al., 2018; Balcarová et al., 2014), where the brand itself is either losing its weight or strengthening it. Koprda (2014), Džupina and Janková (2017) as well as Bulanda et al. (2018a) emphasize that consumer behavior is a complex of behavior that is not influenced by just one factor. It is the combination of different factors and mainly of the price and quality.

Here can be seen the possibility for private labels, which can become a perfect alternative to traditional brands, bringing several benefits not only to the consumer and retailer but also to the supplier himself, especially in increasing his sales volume, lower communication and logistics costs, and options to enter new markets (Corstjens and Lal, 2000; Collins-Dodd and Lindley, 2003; Richardson et al., 1996). While the main advantage for the consumer is the easy identification of private label products, the lower price, respectively the guarantee of authenticity, origin, and standard, as well as of comparable quality (Tvrdoň and Přibyl, 2004), for the retailer it is the strengthening of image (Liu and Wnag, 2008), expanding supply, increasing demand and strengthening customer loyalty (Cheng et al., 2007; Huang et al., 2007; Kita et al., 2013) as well as minimizing the risks associated with the introduction of new products (Baltas, 1997; Sethuraman and Cole, 1999) and consolidating its position in the retail market (Lukić, 2011).

The mentioned is also true for private labels, and especially those on the Slovak market, whose consumption has been steadily increasing, respectively is slightly fluctuating, as it can be seen from the Figure 4 – purchases of private labels by Slovak consumers have recently increased, respectively they have fluctuated, which in our opinion is largely due not only to the lower price of these products, but also to higher confidence in them, either their ever-increasing quality, which in many cases becomes not only comparable, but also higher than those of traditional brands.

The submitted paper focused on the issue of private labels in the segment of milk and dairy products in a selected segment of customers called millennials, because according to several researches (Polakevičová and Uhríková, 2015; Šedík et al., 2018a; Šedík et al., 2018b), they represent potential customers, with a high potential to become loyal customers.

Submitted paper aimed was to find out how Slovak millennials perceive private labels, in which categories they buy them, what motivates them and on the contrary discourages them from the purchase, while we focused primarily on the segment of milk and dairy products regarding the fact, that many different studies proved that private labels are mainly purchased in the categories of milk and dairy products (e.g. research by Košičiarová et al. (2014), Retailmagazin.sk (2018), GFK (2018), Košičiarová et al. (2018) etc.) and the questions focused on the mentioned issue was formulated in the questionnaire survey.

In terms of purchasing private label products, the current situation between potential loyal customers and private label customers in Slovakia among Slovak millennials is favorable, as out of a total number of 549 respondents, 24.41% of respondents buy these products regularly and 57.92% of respondents buy them sporadically, while purchasing them mostly because of good quality, adequate price, good previous experience or recommendations from family and friends, the do not purchase them mainly because of their uninteresting package, low quality, high price as well as their lack of interest to try them. In the case of an exact frequency of purchase, it is possible to say that our respondents purchase private labels mainly once a month (31.06% of respondents), respectively multiple times a week (23.19% of respondents); buy mainly milk and dairy products followed by mineral waters, lemonades, and juices. Products milk and dairy private labels are purchased weekly (40.66% of respondents).

At least are private label products purchased in the categories of frozen semi-finished products, prepared meals, and alcoholic beverages (Table 3 and Table 4).

Our results once again largely correspond to the results of previous researches, e.g. TNS Slovakia (2015), GFK Slovakia (2010), Nagyová and Košičiarová (2014), Košičiarová et al. (2017), etc. which show that Slovak consumers buy private labels primarily several times a week or once a week; they buy them mainly because of their cost-effectiveness, quality and confidence; and that every Slovak household has “favorite brands” in its regular and regular purchases (TASR, 2010).

Because the consumer behavior is changing and nowadays to the forefront is becoming the healthy lifestyle, more people are suffering with special illnesses and specific needs, we have asked our respondents whether they purchase the specific categories of private label products, e.g. gluten-free products, low-fat products, etc. and if so, what are the reasons. The results of research proved, that Slovak millennials start to buy the specific categories of private label products, purchase them mainly sporadically (27.59% of respondents) or regularly (12.93% of respondents) and they do so mainly because of the following reasons: healthy lifestyle, need to try something new, reasonable price or due to the health reasons.

As the consumer is considered to be the end user or the consumer of the given product (Bulanda et al., 2018b; Pilař et al., 2018), the questionnaire survey aimed at finding the answer to whether our respondents are the final users of purchased private label products. It can be confirmed that our respondents are the consumers of private label products, as they have stated that they are the final consumers of purchased private label products (up to 39.06% of the respondents) and therefore it is true that Slovak millennials represent potential loyal customers of private labels. Attracting customers is the primary goal of any business, as the customer creates a demand for goods and services and is very likely to become a loyal consumer who will become loyal to the given business or brand. In doing so, companies compete mainly by promoting and lowering prices to attract the largest customer base (Kenton, 2018; Světlík and Bulanda, 2019; Kaliji et al., 2019).

From this it is necessary to realize what works in the given customer segment, respectively does not work. The results of our research show that while the decisive factor leading to the purchase of private labels is the combination of reasonable price and quality (47.72% of respondents), the decisive factor discouraging from the purchase of private labels is their price, low quality and lack of information about the exact manufacturer (20.04%, 17.12% and 13.84% of respondents). The mentioned results are also confirmed by the researches of e.g. Kumar and Babu (2014) Paraffin, Zindove, and Chimonyo (2018) and Kurajdová et al. (2015) confirm our results and identify quality and price as the main factors determining the purchase of specific products.

Up to the question, what would influence our respondents to the purchase of private labels, we can say that in the case of Slovak millennials it is mainly the recommendation from their families and friends (40.62% of respondents), resp. tastings (16.21% of respondents), free samples, or more interesting form of promotion (in both cases 15.12% of respondents).

It is very common and it can be said also misconception that the low price is also an indicator of poor quality (Sproles, 1977; Völckner and Hofmann, 2007; Gabrielsen and Sørgard, 2007; Asker and Cantillon, 2010). Private labels are often characterized by a low price, which could mean lower quality. This is why, we have asked our respondents how they perceive private label products, what they suggest about them, what do they think about their quality, respectively whether they prefer them based their purchase and if so, in which product categories this happens.

The results of our research show that Slovak millennials perceive private labels as a suitable alternative to the purchase (58.29% of respondents), private labels evoke in them a sense of adequate quality at a reasonable price (59.74% of respondents), the quality of private labels is up to their opinion comparable with the quality of traditional brands (16.76% of respondents think so exactly and up to 42.08% of respondents think so rather), in the case of milk and dairy products they think that their quality is good or adequate (47.18% of respondents, Figure 6) up to 26.55% of respondents exactly prefer them in their purchase, and this is particularly the case of categories such as milk and dairy products, food in general and cosmetics.

The last questions in our questionnaire survey focused on the issue, whether our respondents would recommend private label products to the other consumers and what they would change on them, if they had that chance. According to our findings, young Slovak consumers would recommend private label products to other consumers (20.95% of respondents has declared the possibility of certainly yes and 46.99% respondents rather yes) and if they had the possibility, they would in particular increase the quality of private label products (28.96% of respondents), they would change their packaging and made it more attractive and lower their price (in both cases 15.49% of respondents).

Consumer behavior, factors influencing the purchase, the decision-making process of consumers, etc. were of interest to several studies and research works, but very few of them have focused on millennials, not to mention private labels. The submitted paper focused on the issue of private labels but in a specific segment of customers called millennials, who represent potential loyal customers of private labels, and focused on the issue of private labels in the milk and dairy segment, as several researches has shown that private labels are mainly purchased in this category.

An anonymous questionnaire survey was chosen as the main research method, in which participated 549 respondents in the millennials category; which was supplemented by a blind test (15 respondents from the focus group). The results of our research point to many key findings in this issue, where it was proved that our respondents are indeed the end-users of purchased private label products, they buy them mainly in the category of milk and dairy products, their quality is comparable with the quality of traditional brands (also proven by the results of the blind test), that the decisive factor affecting the purchase of private label products is the combination of reasonable price and good quality, the decisive factor discouraging from the purchase of private labels is their price, low quality and lack of information about the exact manufacturer and what can lead our respondents to their purchase are primarily the recommendations of family and friends, and own experience (tastings and free samples).