Feedback effects of brand extensions on the brand image of global brands: a comparison between Spain and Norway

Abstract

Global brands often attempt to increase their sales through the launch of brand extensions. Such a strategy may, however, dilute existing brand beliefs at an international level, as two sets of data from Norway and Spain indicate. This paper illuminates how the attitude towards a brand extension affects the image of a parent brand. The extension attitude is mainly determined by the degree of perceived fit between the extension and the parent brand image. In the Spanish sample, it is also determined by the degree of familiarity with the parent brand and the perceived fit at the product category level. After analysing these relationships, the paper focuses on the moderating role of two dimensions of consumer innovativeness: hedonist innovativeness (tied to need for stimulation) and social innovativeness (tied to need for uniqueness). Finally, the cultural orientation of the origin country is analysed as a moderating factor.     

The role of perceived value in vertical brand extensions of luxury and premium brands

Abstract

This study examines the role of perceived value in the relationship between brand attitude, perceived fit, extension attitude and consumers’ purchase intention of downscale vertical extensions of luxury and premium brands in two product categories: cars and shoes. Results from 236 individuals with different income levels show that extension attitude is positively related to purchase intention both directly and indirectly, via the perceived value of the extension; the latter is more strongly correlated than extension attitude to consumers’ purchase intention. Brand attitude is also positively associated with perceived value. Overall, perceived value partially mediates the relationships of brand attitude and of extension attitude with purchase intention. The product category affects the strength of some of the relationships in the model, including the role of fit.     

The Effect of Word of Mouth on Consumers’ Attitudes Toward Products and Their Purchase Probability

The purpose of this study is to investigate the effects of word of mouth on consumers’ attitudes toward the product and its purchase probability. Furthermore, we examine the moderating influence of susceptibility to interpersonal influence, which is a personal characteristic of the receiver of word of mouth information. A quasi experiment was conducted, in which subjects were asked to evaluate a product, while being subjected to positive or negative word of mouth. Our results indicate that negative word of mouth has an impact on consumers’ attitudes and purchase probability, while the influence of positive word of mouth was not significant. Interestingly, susceptibility to interpersonal influence does not play a moderating role. While the experimental design with an unknown word of mouth source and fictitious brand allowed the comparison of results for the positive, negative, and control group, such conditions do not correspond to an actual market setting.     

Influence of Corporate Image on Brand Extensions: A Model Applied to the Service Sector

The paper presented here provides a new perspective in the study of service brand extensions, which has become a popular strategy for launching new services. Specifically, the paper proposes and estimates a model that shows how potential consumers evaluate service extensions. The findings show that the corporate image affects both the perceived service quality and the perceived fit between the new service and the parent brand, which in turn affects attitudes towards the extension. In consequence, the service extension is more likely to be successful when the corporate image is reinforced by effective marketing communications. The perception of service quality will be better and consumers will think that the company is more able to offer the new services.