Brand typicality and distant novel extension acceptance: How risk-reduction counters low category fit

Abstract

To increase consumer acceptance of novel products, firms often employ extension strategies, that is, launching new products under familiar brand names. Prototypical brands are among the most familiar in any product category, and, therefore, seem attractive candidates for extension efforts. But, by definition, prototypical brands and their product category show a strong association. Starting from a categorization theory perspective, prior research suggests that this association may hinder the extendibility of prototypical brands to products that belong to distant categories. Yet counter-intuitively, results from two studies focusing on novel extensions demonstrate that brand prototypicality increases rather than decreases consumer acceptance of novel extensions, in “close” as well as “distant” product categories. A mediation analysis provides evidence for the underlying mechanism by indicating that the risk-reducing advantage of prototypical brands outweighs their category-anchored rigidity.