Role of Consumer Relationships With a Brand in Brand Extensions: Some Exploratory Findings
ABSTRACT - Prior research on brand extensions has shown that an extensions success depends on the perceived quality of the original brand and the extensions similarity to its original brand. The present research attempts to extend this literature by proposing and demonstrating that consumer-brand relationships are also important for an extensions success. The general proposition is that consumers having a strong relationship with a brand might react to its extensions more positively than those lacking such a relationship, and that this effect is above and beyond the effect that the perceived quality might have on judgments about the extension. To test this possibility, a survey about five national brands and their potential extensions was conducted with a sample of 430 adult consumers. Findings from causal path analyses indicated that brand relationships directly influenced purchase intentions of the extensions regardless of the extensions similarity to the original brand. In addition, brand relationships indirectly influenced purchase intentions via affecting the perceived quality of the extension. However, this effect was pronounced only when the extensions were dissimilar rather than when similar to the original brand category. Theoretical and managerial implications of these findings are discussed.
Citation:
Jong-Won Park and Kyeong-Heui Kim (2001) ,"Role of Consumer Relationships With a Brand in Brand Extensions: Some Exploratory Findings", in NA - Advances in Consumer Research Volume 28, eds. Mary C. Gilly and Joan Meyers-Levy, Valdosta, GA : Association for Consumer Research, Pages: 179-185.
[We would like to thank Professors Bob Wyer and Jin Yong Lee, and members of the Korea University B.E.S.T. Marketing Group for their helpful comments on earlier drafts of this paper, and Youngrhan Cho and President Han at M&C, Inc. for their assistance in data collection.] Prior research on brand extensions has shown that an extensions success depends on the perceived quality of the original brand and the extensions similarity to its original brand. The present research attempts to extend this literature by proposing and demonstrating that consumer-brand relationships are also important for an extensions success. The general proposition is that consumers having a strong relationship with a brand might react to its extensions more positively than those lacking such a relationship, and that this effect is above and beyond the effect that the perceived quality might have on judgments about the extension. To test this possibility, a survey about five national brands and their potential extensions was conducted with a sample of 430 adult consumers. Findings from causal path analyses indicated that brand relationships directly influenced purchase intentions of the extensions regardless of the extensions similarity to the original brand. In addition, brand relationships indirectly influenced purchase intentions via affecting the perceived quality of the extension. However, this effect was pronounced only when the extensions were dissimilar rather than when similar to the original brand category. Theoretical and managerial implications of these findings are discussed. BACKGROUND It is now well documented in the literature that the effectiveness of a brand extension depends on at least two factors: the perceived quality of the original brand and the similarity between the extension and the original brand category. A number of empirical papers have sown that although a higher quality brand can produce a more successful extension, it is likely to be the case only when the extension is similar to the original brand (Aaker and Keller 1990; Broniarczyk and Alba 1994; Park, Milberg, and Lawson 1991). One direct implication of these findings is clear: "Do not extend to a dissimilar category." But, it is not difficult to observe successful extensions to dissimilar categories in the real world. This seemingly contradictory phenomenon can be better understood when one considers additional factors, which might contribute to the success of extensions. In this paper we show that a consumers existing relationship with a brand plays an important role in the brand extensions success, on top of the role played by the perceived quality of the original brand. Brand Extension Literature A number of factors have been proposed to influence consumers acceptance of proposed extensions, including brand characteristics, extension characteristics, strategic characteristics, and firm characteristics. Much focus has been on how extension judgments might be shaped by attitudes toward or other associations with the original brand that consumers currently hold (e.g., MacInnis and Nakamoto 1991), congruity or similarity between the extension and the original brand category (e.g., Aaker and Keller 1990; Park et al. 1991), and the interaction between these two (Aaker and Keller 1990; Keller and Aaker 1992). Strong evidence has been found for these determinants of evaluations of extensions. There is ample empirical evidence that strong brands benefit extensions more than weak brands. For example, Smith and Park (1992) argued that stronger brands might have a greater ability to reduce perceived risk than weaker ones and showed a positive and significant relationship between brand strength and the brand extensions market share. In addition, it has been experimentally demonstrated that the perceived quality of a parent brand is likely to be transferred to its extensions. In this experimental research, brand strength is often conceptualized in terms of consumers attitudes or judgments of quality associated with the brand (Aaker and Keller 1990; Smith and Park 1992). Finally, the similarity between an extension and the original brand category moderates the transfer of attitude or affect. Substantial evidence has implicated category similarity in brand extension evaluations (Aaker and Keller 1990; Boush and Loken 1991; Keller and Aaker 1992). Perhaps the most useful conceptual framework that can be used to account for these results might be the dual processing formulations of person impression formation postulated by social cognition researchers (e.g., Brewer 1988; Fiske 1982; Fiske and Pavelchak 1986). These formulations are based on the distinction between the category-based processing and the piecemeal processing (for a recent review, see Fiske, Lin and Neuberg 1998; Fiske and Neuberg 1990). Briefly, upon exposure to an evaluation object, perceivers first attempt to categorize that object on the basis of salient cues. These cues can take the form of physical characteristics, such as skin color or body shape, or a verbally transmitted categorical label such as race or gender. Upon receiving additional features or individuating information, perceivers may engage in a confirmatory categorization process to preserve the initial categorization, but this additional process is largely dependent upon the level of personal relevance of the evaluation object for the perceivers. Whether or not the initial categorization is maintained is a function of the degree of congruence between thefeatures of the stimulus object and the features of the category prototype (e.g., Loken and Ward 1991). If the categorization is successful, the evaluation of the object is likely to be based on the affect associated with the category. If the categorization is not successful, however, subtyping or piecemeal integration of various features may serve as basis for forming an evaluation (e.g., Bodenhausen and Wyer 1985). Similar category-based processes have been observed in the context of forming product judgments (e.g., Meyers-Levy and Tybout 1989; Rao and Monroe 1988; Sujan 1985; Sujan and Dekleva 1987). Further, it has been shown that a brand name can serve as a category label and thus lead to a category-based evaluation (e.g., Chaiken and Maheswaran 1994; Hong and Wyer 1989; Maheswaran, Mackie and Chaiken 1992). In line with these findings, the evaluations of an extension that are contingent upon its similarity to the original brand category have been conceptualized as a category-based processing phenomenon (e.g., Boush and Loken 1991; Meyers-Levy, Louie, and Curren 1994; Milberg, Park, and McCarthy 1997). That is, the level of congruity with a previously defined category (i.e., brand) is viewed as varied by the similarity between the original brand and its extension. Therefore, when a brand extension is perceived as similar to the original brand and thus, identified as belonging to the brand category, the affect or perceived quality associated with that category is likely to be transferred to that extension. More recently, research has shown that brand extensions can be successful even when the product-level similarity is low, if the extension possesses a concept consistent with that of the original brand or if it effectively utilizes the strong specific associations of the original brand. For example, Park et al. (1991) reported that perceptions of the extensions fit depended not only on product-level similarity, such as features or attributes, but also on the consistency of the extension with a parent brands concept. Broniarczyk and Alba (1994) found that a brands specific association made a greater contribution to the evaluation of brand extensions when it was "relevant" in the extension category than when it was not. Although different in more specific aspects, the above studies strongly suggest that similarity or fit between a parent brand and its extension moderates the effects of brand associations such as brand affect, brand concept, and specific features. Finally, people experiencing a positive mood might accept an incongruent extension quite well, and sometimes even better than a quite similar extension (Barone et al. 2000). However, all of these effects are likely to operate only when the extensions incongruity is relatively moderate. When it is rather extreme, an extension is doomed to failure. In this paper, however, we propose that there might be conditions under which extensions into quite dissimilar categories can be successful. Specifically, it is proposed that an extension in a dissimilar category can be successful if the parent brand has developed a strong relationship with consumers. This proposition is explained next. Brand Relationships Research on interpersonal relationships has attempted to identify key determinants of the stability of close relationships as well as the processes underlying them (see Bersheid and Reis 1998 for a review). One conclusion from this literature is that a relationship, once developed, tends to stabilize at a particular level of intimacy or closeness. According to the investment model of close relationships (Rusbult 1983), individuals become increasingly dependent on their relationships tothe degree that (a) satisfaction level is high, (b) quality of alternatives is poor, and (c) investment size is high. As a result, they become increasingly "committed" to the relationships. Here, commitment represents long term orientations toward the relationships, including psychological attachment and intent to persist the relationship, thus including cognitive, conative, and affective components. It has been demonstrated that commitment is the critical determinant of relationship stability. The investment model further suggests that, once a relationship reaches a satisfactory level, it is likely to be maintained at that level. Commitment reliably promotes persistence in a relationship. There is good empirical support for this in the literature (for a review, see Rusbult and Van Lange 1996). Moreover, commitment also promotes so-called pro-relationship behaviors. Specifically, commitment encourages willingness to sacrifice or tendencies to forego desired activities for the good of the relationship (Van Lange et al. 1997). Further it promotes accommodative behaviors or tendencies to accommodate rather than retaliate when a partner engages in a potentially destructive behavior. Thus, although a partners destructive behavior may be harmful or seem unjustifiable, the person in a satisfying relationship may exhibit a high level of affect and submission, and react constructively. For example, Rusbult et al. (1991) found that students who were more satisfied with their relationships exhibited greater accommodation such as loyalty (e.g., "I give my partner the benefit of the doubt and forget about it") than did those in less satisfying relationships. The above commitment processes are largely motivational. However, commitment also influences cognitive processes and thus creates cognitive biases such as positive illusion or tendencies toward excessively favorable evaluations of ones partner or relationship. According to this cognitive perspective interpersonal interactions and on-going relationships result from cognitive processes around self-partner schemas. This schema has been posited and empirically proven to often guide the individuals behavior in social interactions and in the development and maintenance of relationships (e.g., Baldwin 1992; Bersheid and Reis 1998; Bradbury and Fincham 1990). Specifically, schemas about the self-partner relationship (also called "relational schema") often lead to top-down processes in new instances, thus creating interpretation biases, as well as attributions that cast the partners behavior in a positive or negative light depending on the quality of the relationship. For example, Murray, Holmes, and Griffin (1996) have shown that individuals impressions of their partners were more a mirror of their self-images and ideals than a reflection of their partners self-reported attributes. These impressions were more positive than their partners self-reports, reflecting positive illusion. Do consumers engage in a relationship with a brand as they do with a person? Further, will they exhibit the sort of commitment processes described above? An affirmative answer is available in the recent research by Fournier (1994, 1998). In this research, she has documented compelling evidence for the existence of consumer-brand relationships and further proposed a relationship quality framework in consumer-brand contexts. According to the framework, consumer and brand actions determine the brand relationship quality. This relationship quality is then assumed to be associated with the intermediate process of developing and maintaining the relationship as well as with ultimate consequences such as relationship stability and satisfaction. This consumer-brand relationship perspective along with the research on interpersonal relationships discussed above seems to provide an implication for brand extensions. That is, an extension into a dissimilar category may be viewed as a brands "deviant" behavior and perhaps as an unjustifiable act. However, if consumers have stablished good relationships with the original brand and thus feel strongly committed to their relationships, they might exhibit pro-relationship behaviors to a great extent. For example, they may interpret the dissimilar extension in light of the existing relationship schema, which is positive in nature (e.g., perceiving the extension as an "adventurous" rather than as a "reckless" act; c.f., Higgins, Rholes, and Jones 1977). Or they may see the possibility of its success rather than its failure via positive illusion processes. These processes are likely to lead to a more favorable perception of the extensions quality, which in turn would increase the purchase intention of the extension. In addition, consumers in a good relationship with the original brand may just accommodate the dissimilar extension as it is or at least, be willing to try it. As a consequence, their purchase intension for the extension might increase, while their perceptions of the extensions quality being unaffected. In sum, it was expected that brand relationships might play an important role in brand extensions that is above and beyond the role by original brand quality. Specifically, independent of the original brand quality, the brand relationship quality might influence purchase intentions of brand extensions through first affecting perceived quality of the extensions. In addition, the brand relationships might directly influence the purchase intensions. EXTENSION PRODUCT CATEGORIES METHOD Focal Brand and Extension Categories Characteristics of focal brand. A total of five brands were used as the focal brands for extensions in the present study. All five were national brands in Korea and currently the market leaders in their product categories. Specifically, they consisted of one grocery food brand (Pulmuone), one bed-set brand (Ace), one cellular phone brand (Anycall), one nonalcoholic drink brand (Birak), and one beer brand (Hite). This choice was made based on two considerations: (1) they must represent diverse product categories including both durable and non-durable products and (2) must be well known to consumers. Two potential extension categories. For each focal brand, two product categories were chosen as potential extension categories. This choice was made to create two different levels of similarity (similar vs. dissimilar) between the original brand and the extensions. That is, one of them was quite similar to the original brand and the other was dissimilar in terms of the key brand concept and/or the product class type. For example, the extension categories considered for the grocery food brand (Pulmuone) were related to the key concept of the original brand, healthfulness ("ready-to-eat a healthy lunch" and "fitness center"). However, the first one pertained to the same food category, whereas the other pertained to a totally different category. In this sense, the first extension was considered to be similar to the original brand, but the second was not. Table 1 shows two extension categories for each focal brand in the descending order of similarity. Subjects A total sample of 430 adults living in Seoul, the capital of South Korea, participated in the survey. A quota sampling procedure was used with consideration of the age and sex distributions of the sampling population. The samples ages ranged from 20 to 54 years old. Among them, 50.1% were females. Survey Procedure The survey was administered by a professional survey organization. The data were collected through face-to-face interviews along with a structured questionnaire. All interviewers were female and well experienced. About an hour long orientation was given to these interviewers regarding the purpose of the survey and the contents of the questionnaire prior to the survey. The data were collected over approximately a two-week period of time. Measures The original survey administered has diverse objectives and covers more issues than those relevant for the present paper. Below, we describe only the relevant measures, which consist of two parts. The first part examines the respondents judgments about the focal brands per se, and the second part examines judgments about the extensions of these brands. MEAN JUDGMENTS ABOUT BRAND EXTENSIONS AS A FUNCTION OF SIMILARITY Assessment of focal brands. First, cognitive evaluations of the focal brands were measured. Two 7-point semantic differential scales were used: ('1- poor quality, '7- good quality) and ('1- bad product, '7- good product). These scales are most frequently employed in the previous brand extension research to measure the strength or quality of the original brand (Aaker and Keller 1990; Smith and Park 1992). Since the two scale items were highly correlated, they were averaged into a composite quality index of the original brand for later analyses (hereafter, BQ, Cronbach a=.86). Second, the nature of respondents relationships with each brand was measured along various dimensions. Respondents were first instructed to indicate the degree to which they agreed or disagreed on several statements along 7-point scale ('1- absolutely disagree, '7- absolutely agree). Then, four statements tapping various aspects of consumer-brand relationships were presented. These were: "This brand and I have very similar personalities," "I strongly prefer this brand to others in this product category," "I know a lot about this brand," and "I have been committed to this brand and will continue to be so in future." These statements were thought to reflect brand-self concept association, satisfaction, brand knowledge, and commitment, respectively (c.f., Fournier 1998). These were followed by two items measuring consumer feelings of psychological attachment to the brand. Respondents were asked to indicate how they would feel if they encounered the brand on two 7-point scales: ('1- very displeased, '7- very pleased) and ('1- feel bad, '7- feel good). Although much simpler, these measures altogether correspond well to recent conceptualizations and measures of brand relationship quality (Fournier 1994, 1998). Since all six items above were highly correlated, they were averaged into a composite brand relationship quality index for later analyses (hereafter, RQ, Cronbach a=.88). Assessment of brand extensions. The second part of the measures concerned the effectiveness of brand extensions. In general, a very lengthy questionnaire might cause respondents to be fatigued and bored, which potentially can result in response bias. To minimize this problem, respondents were asked to assess brand extensions of only two (out of five) focal brands. One of them was the grocery food brand (Pulmuone) for all respondents. The other was one of the remaining four focal brands and was counterbalanced across respondents. Thus, the number of respondents for each of the four focal brands was approximately the same (i.e., a quarter of the sample each). Effectiveness of brand extensions was assessed in terms of purchase intention and perceived quality. Respondents were first instructed to assume that they were about to make a purchase decision in a given product category. Then, they were provided with an extension and asked to indicate the likelihood that they would seriously consider the extension if it was available in the market ('1- very unlikely, ' 7- very likely). This purchase intention will be denoted by PI, hereafter. Next was the assessment of their perceived quality of that extension. Respondents indicated their judgments about the extension on two 7-point scales: ('1- poor quality, '7- good quality) and ('1- bad product, '7- good product). These two items were highly correlated, thus were averaged into a composite quality index for later analyses (hereafter, QUAL, Cronbach a=.88). To control possible order effects in administering these items, four different question orders were created by counterbalancing the order of two focal brands and the order of two extensions (similar vs. dissimilar) within each focal brand. That is, half of the respondents answered the questions for extensions of the grocery brand, Pulmuone first, whereas the other half answered the questions for the other focal brand first. Crossed with this counterbalancing, half of the respondents answered the questions for the similar extension first, whereas the other half answered questions for the dissimilar extension first. RESULTS Effects of Similarity We first compared purchase intentions and perceived quality of brand extensions as a function of similarity between the original brand and the proposed extensions. Consistent with the previous research, we expected that judgments about extensions would be more favorable when the extensions were similar than when they were dissimilar to the original brand. This in fact was the case. As shown in Table 2, in all five focal brand cases both purchase intentions and perceived quality of extensions were consistently more favorable in the similar extension than in the dissimilar extension conditions. This tendency aso appeared to be relatively stronger on perceived quality than on purchase intentions. Effects of Perceived Brand Quality (BQ) and Brand Relationship Quality (RQ) Causal path analyses. It was expected that brand relationships might play an important role in brand extensions on top of the role played by original brand quality. Specifically, independent of the original brand quality (BQ), the brand relationship quality (RQ) was expected to influence purchase intentions of brand extensions (PI) through first affecting perceived quality of the extensions (QUAL). In addition, the brand relationships might directly influence the purchase intentions. However, the magnitude of direct and indirect effects was likely to depend on the degree of similarity of the extensions to the original brand. To investigate these possibilities the following causal path model was developed and tested. In the path model tested, BQ was hypothesized to influence QUAL, which in turn would influence PI. That is, BQ was expected to have only indirect effects on PI. By contrast, RQ was hypothesized to have both direct effects (RQ -> PI) and indirect (RQ -> QUAL -> PI). Figure 1 shows these hypothetical paths between the constructs in the model. The validity of this model was assessed using LISREL 8 (J÷reskog and S÷rbom 1993) in each of similarity (similar vs. dissimilar extensions) by focal brand (grocery food brand/four focal brands combined) combinations. Four conventional model-fit indicators were used: the chi-square statistics, the goodness-of-fit index (GFI), the root mean square residual (RMR), and normed fit index (NFI). In addition, a beta coefficient was estimated for each path in the model. Results. Reports of results from these analyses will be organized as following. Note that all respondents judged the extensions of the grocery food brand (Pulmuone) and the extensions of only one of the remaining four focal brands. We first analyzed judgments (PI and QUAL) about the extensions of the grocery food brand. Some important results were obtained (they will be reported below). We then analyzed PI and QUAL of each of the remaining four focal brands extensions separately to see if the results from the grocery food data were replicated. That was in fact the case. Since the separate analyses produced virtually the similar pattern of results regardless of which of the four brands was concerned, we combined the data across the four brands for final analyses in order to increase the sample size and the power of analyses, and thus present those results only. RESULTS FROM PATH ANALYSES AS A FUNCTION OF SIMILARITY In terms of overall validity of the path model, it was apparent that the model fit the data pretty well in all four cases (see Figure 1). GFI, NFI, and RMR indices indicated an almost perfect fit of the model regardless of similarity levels and regardless of which focal brand was concerned. c2 statistics supported the model in three out of the four cases. Even for the one unsupported case (in the case of the dissimilar extension of the grocery food brand), the absolute c2 value was quite small. In sum, the causal path model well accounted for the data, suggesting that brand relationships significantly influenced judgments about the extensions independently of the original brand quality. Next, beta coefficients for causal paths strongly suggested that BQ and RQ had different roles in brand extensions, depending on the similarity level. Specifically, effects of BQ on QUAL were consistently greater in the similar extension conditions (b=.64 and .46, in the grocery food brand and in the other brand cases, respectively) than in the dissimilar extension conditions (b=.11 and .14). This is consistent with the past findings that the affect or evaluation associated with the parent brand is transferred to the extension only when it is similarto the parent brand category. Different results emerged for the effect of RQ. Specifically, RQ had virtually no effect on QUAL in the similar extension conditions (b=.01 and .05, in the grocery food brand and in the other brand cases, respectively), but exerted a significant influence on QUAL in the dissimilar extension conditions (b=.18 and .24). Finally, RQ had a significant direct effect on PI in both similar and dissimilar extension conditions. This was true regardless of which focal brand was concerned. DISCUSSION The brand extension literature has emphasized the strength of the original brand and the similarity between the original brand and the extensions. Thus, a brand extension is expected to be potentially successful only when consumers perceive the original brand as strong in quality as well as the extension as similar to the original brand. On the other hand, the relationship literature suggests that a strong brand relationship may help overcome the obstacles that otherwise, dissimilar extensions might face. This possibility was supported in the present study. Overall, the brand relationship quality significantly influenced judgments about the extensions and particularly the purchase intentions, even after the effects due to the original brand quality were controlled. This effect was obtained both in the grocery food brand case and in the four other (combined) cases. Specifically, the brand relationship had direct effects on purchase intentions about the extensions regardless of whether the extensions were similar or dissimilar to the original brands. In addition, the relationship further influenced purchase intentions via affecting the perceived quality of the extensions when the extensions were dissimilar. It is intriguing that as the extensions became dissimilar, the effect of the relationship quality on perceptions of extension quality increased, whereas the effect of the original brand quality decreased. Parallel with the previous findings (e.g., Aaker and Keller 1990), this research demonstrated that the effect of original brand quality on evaluations of the extension was limited to the situation in which there was congruence between the extension and the original brand category. The effect was very strong in similar extension conditions, but negligible in dissimilar conditions. On the other hand, the effect of the relationship quality on evaluations was not pronounced in the former conditions, but was significant in the latter. One possibility is that consumers might be motivated to bolster the efficacy of their partners act (i.e., the brand extension), but do so only when they feel it is necessary (i.e., when the extension is dissimilar). In such case, the extent to which the bolstering occurs is likely to be a function of the strength of the relationship quality. Another possibility is that cognitive biases such as positive illusion, thus more favorable evaluations of extensions are subject to the ambiguity of the target object (e.g., Herr, Sherman, and Fazio 1983, Stapel, Koomen, and Van D. Plight 1997). Thus, when the implication of an extension is clear (e.g., when it is very similar to the original brand), there might be no room for consumers relationship schema to operate in determining the extensions quality. This research makes a contribution to the current literature. On one hand, it increases our understanding of the brand extension phenomenon by providing an explanation about how dissimilar extensions might be successful. On the other hand, it contributes to the brand relationship reserch in that this study provides a concrete evidence for the importance of brand relationships. A managerial implication of this seems straightforward. Brand managers are better off when they manage their brands from the perspective of relationships with consumers, not just based on consumers cognitive evaluations of the brands. Several limitations of the present study should be noted for future research directions. First, our measures of brand relationships are rather crude. Future research needs to investigate if the results obtained here will be replicated when a more refined measurement scheme is employed for the consumer-brand relationship construct. 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Authors
Jong-Won Park, Korea University
Kyeong-Heui Kim, University of Minnesota
Volume
NA - Advances in Consumer Research Volume 28 | 2001
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