Consumer’s evaluation of a new product bearing a familiar name: An exploratory study on brand equity extensions in the hospitality industry

Abstract

For more than a decade hospitality and travel enterprises have tested and introduced a vast array of new products designed for more narrowly desined consumer markets. A related activity has also gathered momentum particularly as a marketing strategy; the utilisation of an enterprise’s identity in the form of its established brand name to boost the introduction of a new product.

How a consumer evaluates a new product bearing an established brand was the purpose of this pilot study conducted in the service sector. Utilised in the research was a model of consumers’ evaluation of a brand extension that postulated comparisons between existing product, new product and brand image attributes. The attributes were categorised and dichotomised into feature-based and concept-based dimensions.

Consumers are posited to examine the similarity or congruence between salient and accessible attributes in judging the fit between the new product and brand. A good fit is believed to increase the likelihood of consumers’ favourable acceptance of the new product. Results of an exploratory field experiment provide support for the model and have implications for practitioners implementing the strategy.