The effect of vertical brand extensions on consumer-brand relationships in South Africa

O Muroyiwa,R Abratt,M Mingione

doi:10.4102/sajbm.v48i1.15

Abstract

The purpose of this research is to evaluate the impact of the introduction of vertical brand extensions on Consumer-Brand Relationships (CBRs) in the mobile phone market. In particular, we aim at exploring the effect vertical brand extensions that luxury and functional brands have on consumers’ perceptions, as well as the effect the extensions will have on CBRs. This study pursues a quantitative approach, developing and testing four hypotheses on the influence vertical brand extensions have on four CBR-related constructs, namely brand attachment, brand trust, brand commitment and brand identification. The elicited context is the South African market and the selected brands are Apple, to represent luxury brands, and Samsung, representative of functional brands. Results only partially confirm previous research on vertical brand extension. Supporting previous studies, a vertical step-down extension has been found to have a stronger negative impact on brand commitment for the luxury brand than for the functional one. However, findings disconfirm the literature in revealing a stronger negative impact on the functional brand than the luxury brand and a positive effect on the brand attachment of both brands, especially the functional brand.

Highlights

Many companies prefer to launch their new products as brand or line extensions, leveraging already successful brand names (Keller & Lehmann, 2009) The motive for a brand extension strategy is usually an effort to leverage “previous positive consumer attitudes towards a brand on new products carrying that same brand name” (Dall'Olmo Riley, Pina & Bravo, 2015: 886)
The purpose of this research is to evaluate the impact of the introduction of downward brand extensions on consumerbrand relationships (CBR) in two mobile phone brands in the South African market
Brand attachment may have increased in part, due to parent brands associated with high quality tending to have a positive effect on the evaluation of downscale extensions, improved CBRs and a perceived value for money

Summary

Introduction

Many companies prefer to launch their new products as brand or line extensions, leveraging already successful brand names (Keller & Lehmann, 2009) The motive for a brand extension strategy is usually an effort to leverage “previous positive consumer attitudes towards a brand on new products carrying that same brand name” (Dall'Olmo Riley, Pina & Bravo, 2015: 886). Line extensions are the most frequent way of introducing new products, extending a brand to capitalise on a brand’s recognition, and consumer trust may be deemed a proper strategic choice for any firm (Giachetti & Dagnino, 2014). In this day and age, consumers demand variety and choice (Datta, 1996) and more opportunities exist for line extensions that have new flavours or sizes. Other brand extensions are premised on small incremental improvements to the already existing product (Claudiu-Cătălin & DorianLaurenţiu, 2014)

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Conclusion