Reciprocity in upward product line extensions: A longitudinal study

Abstract

Firms often utilize upward line extensions to achieve gains in brand evaluations and overall demand, as favorable experiences with an extension reciprocate to existing products offered under the parent brand over time. Despite such reciprocal carryover effect of customer perceptions, previous research has provided little empirical guidance related to the longitudinal nature inherent in upward line extensions. The present study fills this research gap by utilizing customer responses to specific, discrete service encounters in order to investigate the longitudinal interplay of objective service performance, perceived service quality, and purchase behavior. Our findings provide significant managerial implications related to the effective allocation of marketing resources to prioritize customers based on their sensitivity to objective service performance and interpurchase time associated with a new upward line extension.