An Empirical Investigation of Composite Product Choice

Abstract

Prior ingredient branding research has examined the influence of “stated” factors such as fit between partner brands on composite product (e.g., Tide with Downy fabric softener) attitudes. This research focuses on choice of composite products, and addresses three managerially relevant questions: Which consumer segments are more likely to adopt the composite product? Will the choice of the composite product have positive or negative reciprocal effects on partner brands? Will the introduction of the composite product benefit the primary or the secondary brand more? The authors use a brand choice model to investigate the “revealed” choice of complements-based composite products. Study results indicate that (i) despite high fit between the composite product and the primary brand, consumer segments may have different choice likelihoods for these products, whereas prior research suggests equal likelihood; (ii) the choice of a composite product may not provide a positive reciprocal effect to the secondary brand; and (iii) the introduction of a composite product may benefit the primary brand more than the secondary brand, whereas prior research suggests a symmetrical benefit for the partner brands. Finally, the finding that introducing a composite product may not cannibalize the sale of the primary brand extends the ingredient branding literature, which has been silent on this issue.