Dilution of brand extensions: a study

Abstract

PurposeThe purpose of this paper is to examine situations in which brand extensions are likely to dilute beliefs associated with family brands.Design/methodology/approachHypotheses are developed and tested in a consumer survey that included experimental and control groups.FindingsThe findings show the congruity of the extension with the family brand is an important factor, the absence of which increases the chances of dilution of the family brand. Perceived success/failure of the extension is a more important factor that also enhances or dilutes the image of the family brand.Research limitations/implicationsBrand names can be hurt by brand extensions, which contain attributes incompatible with or negating favorable family brand beliefs.Practical implicationsIf managers feel the dilution is occurring because of an extension, they can increase perceptions that the extension is atypical of the family brand.Originality/valueThis paper identifies certain key attributes of extensions that, if ignored, may dilute the image of the family brand.

Parent brand susceptibility to negative feedback effects from brand extensions: A meta‐analysis of experimental consumer findings

“…Extending brands, however, can be a double‐edged sword; while brand extensions may enhance the image of the parent brand while providing revenues (Keller & Sood, 2003), they can also lead to negative consumer perceptions and assessments of the parent brand that may be difficult to reverse (e.g., Aaker & Keller, 1990; Chang, 2002; Goetz et al, 2014; Iversen & Hem, 2011; Lahiri & Gupta, 2009; Magnoni & Roux, 2012; Martinez & Chernatony, 2004; Sood & Keller, 2012; Volckner et al, 2008). The potentially harmful effects of brand extensions on the parent brand are referred to as “negative feedback effects” (Loken & Roedder, 1993; Milberg et al, 1997; Milberg & Sinn, 2008; Ng, 2010; Zhang & Taylor, 2009).…”