Consumers’ perception of antecedents of successful Service Brand extensions

Changoiwala, Amita
Glynn, Mark
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Master of Business
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Auckland University of Technology

Brand extension is a common branding strategy used by organisation that requires usage of an established brand name in a new category or business area. Brand extensions have received substantial attention from experts in the academic and industry arenas. Despite the prevalence of brand extensions in services, this domain of service brand and brand extension has been left under examined. Businesses are facing fierce competition and every business wants the maximum share of the consumer’s spending and services enhance business competitiveness not only for service brands but also for goods brands. This study examines service brand extensions and the drivers of service brand extension success according to service consumers. Research mainly concentrates to study the underlying motives and intentions for development of perceptions about service brand extensions.

Semi-structured interviews were conducted in New Zealand to empirically answer the four research questions of the study which are as 1) For services do consumers’ perceive parent brand strength as a reflection for extension quality? And why?, (2) Is fit between parent brand and its extension an over-emphasized or under-emphasized driver for service brand extension evaluation and does it play an important role in the success of the service extension?, (3) How important is parent brand service competency/ability to supply/provide the extension?, (4) Do consumers perceive the transfer of skills and resources from parent brand to extension as an indicator of brand extension quality? And why? Research entailed studying two service brands which were Super Shuttle and New Zealand Post.

To analyse the data collected from semi-structured interviews thematic analysis was employed. Interviews were analysed in Nvivo9. Themes produced through thematic analysis are as follows (1) Parent Brand and sub-themes are parent brand strength, competency, resource availability solution provider, parent brand knowledge, and brand experience. (2) Fit and sub-themes are brand fit, category fit and similarity with the existing extensions. (3) Service Quality and sub-themes are employee interaction, timely service and service outcome, (4) Reliability and (5) Convenience. Along with these five themes, service extension suggestions were also produced from the semi-structured interviews.

Research findings show that consumers do perceive parent brand strength to be a reflector of the service extension quality. Corresponding to research question two, findings suggest that fit between parent brand and extensions is neither an over-emphasized nor under emphasized driver for service brand extension evaluation although it plays a significant role in extension success. Parent service brand’s competency to supply a service brand extension is found to be significant for brand extension success. It was established that brand’s competency to provide an extension was more significant than having adequate resources. Relating to research question four findings establish that employees, transfer of skills and resources have a significant role for service brand extension success.

Service branding , Service brand extension , Consumer attitude , Brand success
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