Drivers of Brand Extension Success: What Really Matters for Luxury Brands

The use of brand extensions has become fundamental to the business model of most luxury brands. Many traditional luxury brands such as Louis Vuitton or Chanel have expanded into traditional luxury sectors beyond their core business. Some brands such as Armani or Prada even crossed boundaries to nontraditional lifestyle segments to pursue new business opportunities. Given the high practical relevance of brand extensions for luxury brands and the importance to understand the success factors for their extendibility and potential backward effects on the parent brand, surprisingly little research has addressed these issues for luxury brands in comparison to nonluxury brands. The current research reveals extension‐related differences between luxury and nonluxury brands by simultaneously analyzing key dimensions of parent brand value, fit, and extension category involvement on the consumer's attitude toward the brand extension, which in turn influences the postextension image of the parent brand. Results of a structural equation model based on a survey among 492 participants show that the predominant driver of brand extension success for both luxury and nonluxury brands is overall extension fit, followed by the consumer's involvement in the extension category. The influence of functional value of the parent brand on the extension evaluation is more important for nonluxury brands. The hedonic value of the parent brand is found to be of relevance only in case of luxury brands. Moreover, a reciprocal spillover effect between the extension evaluation and the parent brand evaluation is observed. The degree of luxuriousness of the parent brand moderates this relationship. This effect is weaker for luxury brands.     

From connoisseur luxury to mass luxury: Value co-creation and co-destruction in the online environment

This exploratory study examines the processes of value co-creation and co-destruction between luxury brands and consumers from the consumer perspective using the social resource theory. The study adopted a qualitative, inductive approach using a sample of 24 in-depth interviews with luxury customers, both local residents and tourists, in Thailand. Love, status, information, and services are the four main types of resources involved in online interactions between luxury brands and customers. It is acknowledged that customers have different expectations, determining the way which they use their resources in interaction with the brand. In addition, the co-creation and co-destruction of the luxury brand experience include conversations and sophisticated interactions between many parties, such as the brand itself, staff, customers, and other related groups, for example, consumption communities and social network users.     

Enhancing brand coolness through perceived luxury values: Insight from luxury fashion brands

Consumers of luxury brands have been described as seekers of products that can offer a signaling value to present to others but also a value for their self-concepts in an existentialist spirit potentially linked to being “cool or not.” Prior studies have conceptualized brand coolness and evaluated its impact on consumer responses to brands. However, few studies have contextualized the construct of brand coolness concerning luxury brand realism. We assessed the semiotic tension that luxury brand consumers feel between self-concept and self-presentation to others via a theoretical consideration of four antecedents of brand coolness: individual, social, financial, and functional luxury values; and one intentional outcome such as consumers' passionate desire to use luxury fashion brands. Our findings indicated that luxury values positively influence brand coolness, and brand coolness positively influences passionate desire. We further confirmed that brand coolness plays a complementary mediating role between luxury values and passionate desire. A final contribution is to invite brand managers to consider how luxury values and brand coolness might be used proactively to drive consumers' passionate desires in the relationships with luxury fashion brands.     

The effect of distribution channel diversification of foreign luxury fashion brands on consumers’ brand value and loyalty in the Korean market

The purpose of this research is to examine South Korean consumers’ brand value and brand loyalty toward foreign luxury fashion brands and current distribution channels for those brands (i.e., Department stores/Specialty stores, Factory outlet, Internet retailing, TV home shopping). Furthermore, this research examines the impact of channel diversification on consumers’ brand value and brand loyalty toward foreign luxury fashion brands. This study employed a quantitative research method. Factor analysis, ANOVA, Duncan test, and multiple regression analysis were employed to test the hypotheses. When testing brand values for each channel diversification case, participants evaluated brand value differently depending on the type of distribution channel. Participants did not show significantly different brand loyalty depending on distribution diversification cases. When the influence of brand value on brand loyalty was tested, different brand values affected brand loyalty depending on the type of distribution channel. Also, this research could suggest possible distribution channel options for foreign luxury brands to be successful in the Korean market and values they need to put an importance depending on the retail types. In addition, foreign luxury brands could apply the results of this study to their own markets.     

Counterfeiting: Friend or Foe of Luxury Brands? An Examination of Chinese Consumers’ Attitudes Toward Counterfeit Luxury Brands

ABSTRACT

While the Chinese luxury industry is enjoying rapid growth, the market for counterfeit luxury brands is growing equally fast. There are contradictory views regarding the role counterfeit luxury brands play in the marketplace. Luxury brand owners denounce counterfeit luxury products for harming the reputation of luxury brands and reducing their profitability. Others believe that the availability of counterfeit luxury products may help increase the brand awareness of luxury names and thereby make authentic products more sought after. In this study, we examine the impact of counterfeit luxury products from the consumers’ standpoint. Specifically, the authors investigate whether and how Chinese consumers with different luxury consumption experiences view counterfeit luxury products differently. The study contributes to a better understanding of Chinese consumers’ attitudes toward counterfeit luxury products and thus helps marketers and policy makers develop more effective strategies for dealing with the issue.     

The role of art infusion in enhancing pro-environmental luxury brand advertising

Underpinned by art infusion theory, this present research examines the effect of art infusion on brand attitudes under different brand conditions (i.e. pro-environmental luxury brands and luxury brands) in advertising. Across two experimental studies, this research offers empirical evidence to a moderated mediation model, such that when an advertisement features an artwork (vs. no-artwork), consumers will perceive lower levels of incompatibility between luxury and sustainability, leading to a more favorable brand attitude toward the pro-environmental luxury brand. However, such differences will not occur among consumers evaluating an ordinary luxury brand. The findings of this research broaden the current body of knowledge related to the art infusion effect and provide important implications for marketers in their advertising strategy. Furthermore, these findings suggest that art infusion may be the solution to the dilemma facing sustainable luxury brands since luxury and sustainability are often perceived as incongruent concepts.     

Brand addiction in the contexts of luxury and fast-fashion brands

Although research on consumer-brand relationship has gained increasing interest among scholars, little is known to date about its most intense form – brand addiction. This research explores the main motives and outcomes of this phenomenon in the two brand categories: luxury and fast-fashion brands. The authors conducted 21 in-depth interviews in the U.S. to tap into the respondents' addictive experiences with luxury and fast-fashion brands. Different themes emerged regarding the motivations for luxury and fast-fashion brand addiction. Self-expressiveness, status consumption and perceived quality are motivators for luxury fashion brand addiction while continuous update of fashion-led items, perceived value, and product assortments are motivators for fast-fashion brand addiction. As for the consequences, interpersonal relationships and financial issues emerged as common themes for addiction to certain luxury and fast-fashion brands while selectivity of style and motivation to work harder surfaced as themes for addiction to particular luxury brands. The results also show that brand addiction may cause both positive and negative effects on consumers’ well-being. This research provides important implications for consumer-brand relationships and ethical considerations for brand managers.     

Identifying antecedent conditions for luxury brand purchase

This research draws upon self-termination and complexity theories and aims to identify the antecedent recipes for Chinese consumers' intention to purchase Chinese- (referred to as domestic) or non-Chinese (referred to as foreign) luxury brands. Two studies were undertaken. First, an online survey was undertaken to examine the antecedent conditions of luxury brand purchase. The opted conditions in this study include value perceptions, special occasions, and demographic profiles. An asymmetrical method by employing fsQCA was used to identify the unique antecedent conditions of purchase intentions. Symmetrical testing was also performed prior to fsQCA as a comparison. The findings from symmetrical and asymmetrical methods share few similar, but nevertheless complementary findings, hence providing new insights into consumers' luxury brand choices. In the second study, interviews were conducted to deepen the understanding of Chinese consumers’ knowledge, perceptions of, and attitudes towards luxury brands. Discussion and implications for marketing luxury brands in the Chinese market conclude this paper.     

Brand attachment and customer citizenship behaviors

Service brand attachment has emerged as a growing body of research. Although previous studies have examined the relationship between brand attachment and customer behaviors, the mechanism underlying this relationship remains unknown, particularly in a service context. The purpose of this study was to examine the relationship between brand attachment and customer citizenship behaviors and to clarify the role of perceived value among regular customers of international hotel brands in Taiwan. To examine this model, confirmatory factor analysis was employed to analyze survey data from 299 hotel customers, the results of which indicated that perceived value completely mediated the relationship between brand attachment and customer citizenship behaviors. Therefore, perceived value is the mechanism that explains how service brand attachment is associated with customer citizenship behaviors. These results demonstrate the importance of perceived value and imply that service managers should strengthen customers’ perceived value of service brands to enhance customer citizenship behaviors.     

The manifestation of luxury value dimensions in brand engagement in self-concept

This research investigates what consumers in democratized luxury markets value when purchasing luxury items. Nonetheless, these consumers have a limited budget and can not always buy luxury items, yet they are drawn back to these luxury brands. Thus, we use brand engagement in self-concept (BESC) to explain the relationship between these consumers and luxury brands within democratized luxury markets. A conceptualized model of three luxury value dimensions (experiential, symbolic, and functional) is proposed, and 488 cases were gathered through a phone survey. The data were analyzed using partial least squares structural equation modeling (PLS-SEM). The results show that the most critical drivers of consumers' luxury purchase intention (LPI) are hedonism, escapism, conspicuousness, quality, and usability in democratized luxury markets. Also, BESC can unify luxury value dimensions into an integrated whole and mediate the relationship between them and LPI.     

The brand authenticity continuum: strategic approaches for building value

This article empirically examines the value derived by consumers through their use and consumption of authentic brands and the indirect value attributable to a brand. Our findings provide an understanding of the drivers of value along an authenticity continuum. We demonstrate that authenticity cues of quality commitment, heritage and sincerity have differential effects on a brand’s position along the authenticity continuum and consequently, authenticity strategies. This paper discusses implications where initially, brands move along the continuum with internally driven strategies (germination, cultivation and consolidation). However, to attain very high levels of authenticity, brands pursue an externally driven strategy (preservation) that acknowledges external stakeholder roles in the creation of very highly authentic brands. Directions for future research are also discussed.     

Crafting Extraordinary Stories: Decoding Luxury Brand Communications

Advertising is central to creating brand meaning by endowing brands with symbolic values and embedding them within their broader sociocultural context. This study analyzes how the symbolic meaning of luxury brands is constructed in print advertisements. In particular, the study shows how brand communications of luxury brands systematically differ from those of premium and mass-market brands. Through a comparative analysis of thematic and formal characteristics of 208 print advertising campaigns consisting of about 1,700 individual ads from the primary advertising campaigns of four luxury brands, four premium brands, and four mass-market brands, this study identifies three distinguishing factors of luxury brand communication: enrichment, distancing, and abstraction. First, luxury brand advertising enriches the communication content by using more complex campaign templates that make more frequent use of symbolism, rhetorical structures, and storytelling. Second, luxury brand advertising systematically uses distancing techniques, such as temporal, spatial, social, and hypothetical distancing. Third, luxury brand ads use higher-level discourses that allow for different interpretations of brand advertisements. Therefore, this study provides insights into the construction of brand identity in the luxury field, as well as the broader sociocultural construction of luxury and the evolution of its core symbolic constituencies.     

Role of consumption values in the luxury brand experience: Moderating effects of category and the generation gap

This study examined how the consumption values of luxury brands lead to their patronage. We examined the effects of functional, symbolic, experiential, and zero-moment-of-truth (ZMOT) values on patronage intention through the emotional response process of flow and compatibility using the stimulus–organism–response framework. Furthermore, latent mean analysis of the moderating effects of different groups was conducted. The findings demonstrate that experiential, functional, symbolic, and ZMOT values influence emotional reactions to luxury brand experiences, and these reactions vary among groups. Marketers should increase the value of the luxurious consumption experience and create different values for various consumer groups and categories to expand luxury brands.     

Mediational role of perceived personal legacy value between consumer agentic generativity and attitudes/buying intentions toward luxury brands

This study evaluates three luxury watch brands of different luxury intensity according to their perceived values with a special attention to personal legacy value. It uses the agentic dimension of consumer generativity as a segmentation variable for luxury brands. A parsimonious and reliable scale of perceived personal legacy value is first developed and further used to discriminate the luxury level of brands. Results show the superiority of a high-end luxury watch versus an accessible and a typical luxury brand on personal legacy. Structural equation modeling shows a mediation effect of personal legacy value between consumer agentic generativity and attitudes/buying intentions toward brands. Implications in marketing literature and industry practices highlight the important role of personal legacy as an added value for luxury brands. It also demonstrates the relevance of targeting agentic generative consumers in a luxury consumption context.     

Dimensions of Luxury Brand Personality: Scale Development and Validation

Both the marketing industry and academia have been paying more attention to the growth and potential of the luxury market. This research developed a theoretical framework for understanding the dimensions of luxury brand personality and a reliable and valid scale that measures these dimensions. When 30 luxury brands, ranging from fashion to automobile and retail, were assessed on a set of diverse personality attributes, six dimensions representing luxury brand personality were identified: Excitement, Sincerity, Sophistication, Professionalism, Attractiveness, and Materialism. Findings indicate that while three dimensions, Sincerity, Excitement, and Sophistication, share similar qualities with those identified in Aaker's (1997) scale for general brand personality, the other three dimensions, Professionalism, Attractiveness, and Materialism, reflect meanings unique and specific to luxury brands. Altogether, the results of this research hold the notion that luxury brands serving as consumption symbols provide both utilitarian benefits and symbolic meanings to contemporary consumers.     

Antecedents of retailer loyalty: Simultaneously investigating channel push and consumer pull effects

This study includes information technology (IT) related industries as the focus and aims to examine the antecedents of retailer loyalty toward brand owners by simultaneously investigating push and pull effects in the channel system. The study interviews 274 independent retailers who sell IT related products to end consumers. The results show that the retailer perceived value of selling the brand owner's products plays a pivotal role in promoting their loyalty toward the brand owners. Retailer loyalty toward brand owners comes directly from brand owners' push efforts, and indirectly from pull effects. Additionally, the specific asset invested by each party (brand owners, retailers, and customers) strengthens the relationship within each other in the channel system.     

Exploring consumers’ subjective shopping experiences in directly operated luxury brand stores

Customers’ in-store shopping experiences are critical for luxury brand success. Research on the creation of experiential value in retailing finds clear differences in the cues contributing to delightful consumer experiences depending on the retailing sector. A management perspective dominates research in luxury retailing, while research on consumers’ subjective luxury shopping experiences is scarce. This study contributes to filling the gap regarding consumers’ subjective experiences through a qualitative inquiry into shoppers’ accounts of experiences in luxury brand stores. The study finds that the major determinants of a delightful shopping experience in luxury stores are extraordinary service excellence, unique multi-sensory emotional stimulation conforming to the brand, and a feeling of personal importance and assurance. The study demonstrates the importance of a holistic individual experience in helping shoppers become immersed in the brand universe through all their senses.     

Brand Power Relationships: A Co-Evolutionary Conceptual Framework

Abstract

In the era of the Internet and networking, stakeholders increasingly acquire power by influencing brand value and meanings. However, this does not imply that marketing managers have lost their power over brand creation and management. Thus, the aim of this study is to explore brand power relationships taking the co-evolutionary perspective as conceptual lenses. In particular, this article seeks to address the competitive relationship between the corporation and its stakeholders in determining the corporate brand evolution over time, suggesting that corporate brand management is successful when co-evolving power relationships are established. The relational interplay between managers and stakeholders is framed into the Brand Power Relationship Model that suggests four potential evolutionary paths. It offers new brand typologies supported by examples from business practices, which mirror four different ways of managing and adapting brands over time; namely, through the None’s Brand, the Managers’ Brand, the Stakeholders’ Brand, and the Co-Evolutionary Brand. Focusing on the latter, this study depicts managers and stakeholders as having reciprocal influences and co-determining themselves, thus triggering interrelated relational effects that influence corporate brand evolution over time. The bilateral power of managers and stakeholders is framed into a further model, focused on corporate brand co-evolution. It is proposed that corporate brands can successfully co-create their value and meanings over time only if corporations co-evolve with their environment—in this study, multiple external stakeholders.