When brand extension fit matters

Abstract

Brand extensions are new products or services introduced under an existing brand’s name. Despite the importance of competitive extension positioning in a realistic marketplace, relatively little attention has been given to investigating the impact of comparative advertising message (framed positively or negatively) on brand extension acceptance. There is also a pressing need to address the role of individuals’ motivational factors in enhancing the success of brand extensions. The current research examines how comparative advertising frame and self-regulatory goals influence brand extension evaluations and purchase intentions when brand extension fit matters. The results from Experiment 1 indicate that a positive comparative frame elicited more favorable extension evaluations and greater purchase intentions than a negative comparative frame under the similar extension condition, while both positive and negative comparative frames contributed equally to brand extension evaluations and purchase intentions under the dissimilar extension condition. In Experiments 2 and 3, however, the interactive patterns of brand extension fit and comparative valence frame is in the reverse direction. The findings from Experiments 2 and 3 suggest that a negative comparative message leads to more favorable brand extensions and greater purchase intentions than a positive comparative message under the similar extension. The effects of a positive versus a negative comparative message are reversed and even eliminated when the fit between the parent brand and the extension is perceived to be low. These results suggest that regardless of whether the fit between the parent brand and the extension is high or low, risk perception inherent in purchasing extension products could influence the relative effectiveness of a positive versus a negative comparative message on brand extension evaluations and purchase intentions. Though the hypothesized effects of brand extension fit and consumers’ regulatory focus are not supported in Experiment 1, the results from Experiments 2 and 3 reveal that promotion-focused consumers tend to evaluate brand extension more favorably than prevention-focused participants under the similar extension condition, whereas they are equally responsive to the dissimilar extension. Furthermore, the results suggest that perceived extension risk serves as a critical mediator between brand extension fit and consumer evaluations of brand extensions.