Range Effects on Vertical Brand Extensions

Drawing on research on range-frequency theory we investigate the effects of price point distance and parent brand’s price range on evaluations of vertical extensions. In a series of three experiments we firstly show that price distance has an asymmetric effect of extension evaluation, such that for step-up extensions as the price distance between extension and its parent brand increases, the perception of risk also increase, however this effect is not found for downscale extensions. Then, we show that extension price distance is relative to the parent brand’s width of price range for upscale but not for downscale extensions.

Citation:

Nicolas Pontes, Mauricio Palmeira, and Colin Jevons (2011) ,"Range Effects on Vertical Brand Extensions", in AP - Asia-Pacific Advances in Consumer Research Volume 9, eds. Zhihong Yi, Jing Jian Xiao, and June Cotte and Linda Price, Duluth, MN : Association for Consumer Research, Pages: 59-60.