Brand architecture shift and corporate brand equity: an exploratory study

Abstract

Purpose The purpose of this paper is to explore the effect of a shift in brand architecture strategy on corporate brand equity. The change is from a house of brands to a branded house approach in which the corporate brand is prominent. The study proposes two alternative approaches in order to explore how consumers build the corporate brand equity from single product brand equities in the portfolio: the dilution process or the bookkeeping/subtyping cognitive process. Design/methodology/approach Data were collected through a questionnaire administered to 150 Italian consumers. All the items were related to a real corporate brand – Procter & Gamble (P&G) – and to seven of the product brands in its portfolio. The choice of the Italian context and the P&G brand was motivated by the fact that P&G has recently adopted a shift in its brand strategy, starting to give prominence to the corporate brand in its communication campaign in Italy. Findings The dilution process does not describe the effect of a change in strategy on corporate brand equity, but the bookkeeping/subtyping cognitive process does. This suggests that consumers tend not to revise corporate brand equity when they perceive many product brands behind it. Originality/value The value of the present paper is to deal with a relevant and current topic: the brand architecture dynamism. This research is an exploratory step to satisfy the need for theory-based research on consumer responses to the shift in the brand portfolio architecture strategy.