Abstract:
Perception to fit and perceived quality or the parent brand have been identified as two important factors that determine the success of a brand extension. However, these perceptions vary among people from different cultures. In the present study, we examine whether a higher perception of fit and perceived quality of the parent brand would lead to more favorable evaluation of brand extension among Malaysian customers. The study also modelled the impact of style of thinking (Holistic vs analytical) and regulatory focus goals (Promotion vs Prevention) on the relationship between drivers of successful brand extension and evaluation of brand extension. Cross-sectional data from 500 valid responses were analysed via multiple regression using SPSS (version 2.0) to test the model, employing a real brand, and its hypothetical brand extension. The diagnostic results reveal that the data were fit for inferential analysis. In so doing, empirical evidence supported the significance of direct path. The existence of moderating effects was found to be significant in term of holistic style of thinking. Unexpectedly, we found all interactive effects for regulatory focus goals to be significant.
