Sanjay Sood

Communication Strategies for Brand Extensions: Enhancing Perceived Fit by Establishing Explanatory Links

Abstract This research examines the proposition that high perceived fit of a brand extension results when consumers can establish explanatory links that connect the parent brand and the extension. Explanatory links are created when salient parent brand associations are seen as relevant in the extension context. The salience and relevance of associations depends, in part, upon the dominant parent brand associations, the brand-to-extension relationship, and the communication strategy used to introduce the extension. Results indicated that extensions were poorly rated when the parent brands dominant association was inconsistent with the extensions dominant association. Specifically, brands with dominant attribute-based associations (e.g., physical features) received lower evaluations than brands with dominant non-attribute-based associations (e.g., brand users) when extended to a category with no physical attributes in common. In this case, evaluations were improved with an elaborational communication strategy that provided information about worrisome extension attributes. On the other hand, brands with dominant non-attribute-based associations received lower evaluations than brands with dominant attribute-based associations when extended to a category with physical attributes in common. In this case, extension evaluations were improved with a relational communication strategy that raised the salience of the physical relationship between the categories.

Deep and "Surface" Cues: Brand Extension Evaluations by Children and Adults

We present a conceptual as well as empirical analysis showing that 11–12-year-old children, relative to adults, evaluate brand extensions by relying more on surface cues (e.g., brand name characteristics used to launch the extension) and less on deep cues (e.g., category similarity between the parent brand and the extension category). In experiment 1, children gave equivalent evaluations of brand extensions regardless of category similarity (e.g., Coca-Cola extending to iced tea vs. toffee), whereas adults rated near extensions (e.g., iced tea) more favorably than far extensions (e.g., toffee). In experiment 2, children evaluated near extensions more favorably than far extensions when they were cued to make similarity judgments prior to evaluation but rated near and far extensions equivalently when they were not cued prior to evaluation. In experiment 3, children based their evaluations on the extension names linguistic characteristics regardless of category similarity, whereas adults based their evaluations on category similarity regardless of name characteristics. Children rated extensions with a rhyming name (e.g., “Coca-Cola Gola” iced tea; “Wrigleys Higley” toffee) more positively than extensions with a nonrhyming name (e.g., “Coca-Cola Higley” iced tea; “Wrigleys Gola” toffee), whereas adults rated them similarly. Theoretical implications on branding and categorization research as well as managerial implications are discussed.

Comparison, Grouping, and Preference

How does the attractiveness of a particular option depend on comparisons drawn between it and other alternatives? We observe that in many cases, comparisons hurt: When the options being compared have both meaningful advantages and meaningful disadvantages, comparison between options makes each option less attractive. The effects of comparison are crucial in choice problems involving grouped options, because the way in which options are grouped influences which comparisons are likely to be made. In particular, we propose that grouping focuses comparison, making within-group comparisons more likely than between-group comparisons. This line of reasoning suggests that grouping should hurt, and we observe that it does: An option is more likely to be chosen when alone than when part of a group.

Self-Affirmation through the Choice of Highly Aesthetic Products

Just as good looks bestow an unconscious “beauty premium” on people, high aesthetics bestows an unrecognized benefit on consumer goods. Specifically, choosing a product with good design affirms the consumer’s sense of self. Choice of a highly aesthetic product was compared with choice of products superior on other attributes including function, brand, and hedonics to show that only aesthetics influences a consumer’s personal values. In study 1 a prior self-affirming task leads to a decrease in choice share of a highly aesthetic option. Studies 2 and 3 mimic prior research on self-affirmation with, however, choice of a highly aesthetic product replacing a traditional self-affirmation manipulation. Choosing a product with good design resulted in increased openness to counter-attitudinal arguments and reduced propensity to escalate commitment toward a failing course of action. There are numerous implications of this form of self-affirmation, from public policy to retail therapy.

Subjective Knowledge in Consumer Financial Decisions

The authors propose that attempts to increase consumers’ objective knowledge (OK) regarding financial instruments can deter willingness to invest when such attempts diminish consumers’ subjective knowledge (SK). In four studies, the authors use different SK manipulations and investment products to show that investment decisions are influenced by SK, independent of OK. Specifically, they find that (1) willingness to pursue a risky investment increases when SK is high (vs. low) relative to a prior investment choice (Study 1); (2) willingness to enroll in a retirement saving program is enhanced by asking consumers an easy (vs. difficult) question about finance, thereby increasing SK (Study 2); (3) technically elaborating information about a mutual fund diminishes SK regarding that investment and decreases choice of that fund (Study 3); and (4) consumers invest less money in funds when missing information is made salient, holding the objective investment information constant (Study 4). Furthermore, the effects in Studies 2–4 are mediated by participants’ self-rated SK. The authors propose that effective financial education must focus not only on imparting relevant information and enhancing OK but also on promoting higher levels of SK.

The Effects of Brand Name Structure on Brand Extension Evaluations and Parent Brand Dilution

Three laboratory experiments explore how alternative brand name structures (i.e., family branded or subbranded) and varying degrees of category similarity (i.e., similar or dissimilar) influence extension evaluations and parent brand dilution. The results indicate that subbranded extensions (e.g., Quencher by Tropicana cola) evoke a slower, more thoughtful subtyping processing strategy than family branded extensions (e.g., Tropicana cola), which evoke a faster, category-based processing strategy. As a result, category similarity affects extension evaluations when the extension is family branded but not when it is subbranded. In addition, dilution effects are only evident when consumers have a negative experience with a similar family branded extension. Subbranding thus offers two key benefits to marketers: It both enhances extension evaluations and protects the parent brand from any unwanted negative feedback.

Feeling and Thinking in Memory-Based versus Stimulus-Based Choices

We contrast memory-based and stimulus-based choices, using dual-process theories such as Kahneman and Fredericks system 1/system 2 dichotomy. Systems 1 and 2 are conceptualized as distinct modes of thought, the former automatic and affective, the latter controlled and deliberate. Cognitive load impedes system 2, yielding greater reliance on system 1. In memory-based choice, consumers must maintain relevant options in working memory. Thus, memory-based choices are associated with greater cognitive load than stimulus-based choices. Indeed, we find that memory-based choices favor immediately compelling, affect-rich system 1 options, whereas stimulus-based choices favor affect-poor options whose attractiveness emerges from deliberative system 2 thought. (c) 2007 by JOURNAL OF CONSUMER RESEARCH, Inc..

On Decisions That Lead to Decisions: Direct and Derived Evaluations of Preference

Many consumer choices lead to subsequent decisions. In such situations, any choice option may be evaluated based on its own characteristics (direct evaluations), or evaluated based on the characteristics of alternatives it makes available in subsequent decisions (derived evaluations). We contrast direct and derived evaluations in the context of two consumer research issues. First, in choices between a lone option and a group of alternatives, direct evaluations bias preferences toward the group, whereas derived evaluations bias preferences away from the group. Second, in choices between stores, sensitivity to price is greater under derived than direct evaluations.

When Knowledge Is Demotivating: Subjective Knowledge and Choice Overload

People find it appealing to have more options to choose from, but the provision of choice often leads to adverse consequences for decision makers’ motivation, satisfaction, and willingness to act. We propose that the effect of the number of choice options on willingness to purchase is moderated by people’s subjective knowledge (SK). The results of three studies provide converging evidence that, paradoxically, people who feel unknowledgeable (low-SK people) in a certain domain are especially willing to purchase when more choice options are available, which is consistent with the notion of “more is better.” This pattern is reversed for people who feel knowledgeable (high-SK people), which is consistent with prior evidence for choice overload. We also show that this pattern is influenced by the informativeness of the features of the available choice options and that subjective knowledge mediates this effect.

Similarity between hypotheses and evidence

We explore two novel consequences of similarity-based likelihood judgment. In Section I, we distinguish between the evidence on which judgments are based and the hypotheses that serve as the objects of judgment. The location of a feature, whether in the evidence or the hypotheses, influences the perceived similarity between evidence and hypotheses and consequently yields judgments that are inconsistent with the requirements of probability theory. In Section II, we examine judgment of disjunctive hypotheses. For certain types of disjunctions, the assessment of similarity produces consistent nonmonotonicities: the support of a disjunction is smaller than that of one of its components. Finally, we discuss the implications of our findings in terms of support theory and the principle of context independence.