The adverse effects of inferior innovations

Abstract

AbstractThis research advances brand innovation research by examining the adverse effects of inferior innovative extensions on the brand innovability of own parent brands. Brand innovability conceptually consists of brand quality and innovativeness. The results reveal that radical and incremental inferior innovations exert asymmetric adverse effects on brand quality and innovability. For brand quality, inferior radical innovations exert more negative impacts on the quality of pioneer brands than on the quality of follower brands. However, inferior incremental innovations exert identical negative impacts on the quality of both pioneer and follower brands. For brand innovability, both inferior radical and incremental innovations exert more negative impacts on the innovability of pioneer brands than on the innovability of follower brands. In comparison, brand innovability is less susceptible than brand quality to inferior innovation information. The findings suggest that it is more justified to evaluate innovative brands with brand innovability, instead of brand quality, for two reasons. Firstly, brand innovability is more realistic than brand quality because brand innovability is more relevant than brand quality to profits. Secondly, brand innovability is inclusive of brand innovativeness, which ameliorates adverse effects when innovative extensions are inferior. The threat of inferior innovative extensions is less horrible than expectation if the adverse effects on the innovative brands are assessed with brand innovability, instead of brand quality. However, being innovative is like a double-edged sword. On the one hand, it helps generating more profits. On the other hand, it endangers innovative brands to be more susceptible to inferior innovative extensions. Therefore, for marketing implications, pioneer brands are more obliged than follower brands to ensure the success of radical innovations in order to avoid the possible adverse effects of inferior radical innovations. This research contributes brand innovation research by proposing the more relevant indicator of brand innovability to evaluate innovative brands.