Consumer response to brand extensions: Construal level as a moderator of the importance of perceived fit

One of the most enduring findings from branding research is that consumers evaluate brand extensions on the basis of their perceived fit with the parent brand. In this article, we propose that the importance of perceived fit in extension evaluations is moderated by construal level. We draw upon construal level theory, which posits that individuals can construe stimuli in their environments in terms of abstract and generalized features (high-level construals) or in terms of concrete and contextualized features (low-level construals). Results from three studies confirm that consumers who construe their environment at a higher level place more importance on perceived extension fit in evaluating brand extensions. These consumers evaluate high fit extensions more favorably than moderate fit extensions, consistent with prior research. However, consumers who construe their environment at a lower level do not evaluate high and moderate fit extensions any differently, unless the importance of using fit perceptions is made salient. © 2008 Society for Consumer Psychology. Published by Elsevier Inc. All rights reserved. Brand extensions are one of the most popular strategies for leveraging brand equity. By launching new products under popular brand names, firms hope that consumers will respond more favorably to the new offering, due to their familiarity with the parent brand, positive feelings toward the parent brand, and positive attribute and non-attribute associations they have with the parent brand. Compared to launching a new product under a new brand name, brand extensions can increase the efficiency of promotional efforts, improve access to distribution channels, and reduce consumers' perceived risk of purchasing a product or service (Keller, 2002). What factors determine whether or not a brand extension will be successful? The most important factor identified by prior research is perceived fit. Consumers respond more favorably if they are able to perceive a fit between the extension and the parent brand (Aaker & Keller, 1990; Boush ⁎ Corresponding author. Fax: +1 612 626 8328. E-mail addresses: [email protected] (H. Kim), [email protected] (D.R. John). 1 Fax: +1 514 848 4554. 2 Both authors contributed equally to this manuscript. 1057-7408/$ see front matter © 2008 Society for Consumer Psychology. Publish doi:10.1016/j.jcps.2008.01.006 et al., 1987). Perceived fit can be based on the extension being in a product category similar to other products sold by the parent brand (Boush et al., 1987; Keller & Aaker, 1992), complementing use with other products sold by the parent brand (Aaker & Keller, 1990), being in a product category where the parent brand can contribute an appealing attribute (Broniarczyk & Alba, 1994; Herr, Farquar, & Fazio, 1996), having a parent brand with the skill and expertise to make the extension product (Aaker & Keller, 1990), and having a parent brand with an image that is compatible with the extension (Park, Milberg, & Lawson, 1991). Perceived fit can also be heightened by communications providing a plausible link between the extension and parent brand (Bridges, Keller, & Sood, 2000), thereby giving consumers more opportunity to discover possible links (Lane, 2000), or countering negative inferences about the extension (Aaker & Keller, 1990). Perceived fit, no matter how it is defined, is the most important determinant of brand extension success—more important than marketing support, retailer acceptance, and quality of the parent brand (Völckner & Sattler, 2006). In fact, the role of perceived fit is so widely accepted that researchers have largely neglected the possibility that moderating factors may exist that render perceived fit more or less ed by Elsevier Inc. All rights reserved. 117 H. Kim, D.R. John / Journal of Consumer Psychology 18 (2008) 116–126 influential in brand extension evaluations. The working assumption has been that, for all types of consumers, perceived fit is always important for evaluating brand extensions. To date, the only evidence of moderating factors is found in crosscultural settings, where researchers have reported that consumers from Eastern cultures place less importance on perceived fit in evaluating brand extensions, relying instead more on background factors, such as corporate brand reputation (Bottomley & Holden, 2001; Han & Schmitt, 1997). In this paper, we propose that construal level is a key moderator of the importance of perceived fit in brand extension evaluations. We draw upon construal level theory, which posits that individuals can construe stimuli in their environments in different ways—in terms of abstract and generalized features (high-level construals) or in terms of concrete and contextualized features (low-level construals) (Trope & Liberman, 2003). In judgment and decision making settings, individuals favor information, experiences, or events that match their construal level (Nussbaum, Trope, & Liberman, 2003; Trope & Liberman, 2000). Thus, we reason that consumers who construe stimuli in terms of abstract and generalized features (high-level construals) will place more importance on perceived fit, which is a global and abstract assessment of the connections that exist between an extension and parent brand, when evaluating brand extensions. In contrast, consumers who construe stimuli in terms of concrete and contextual features (low-level construals) will place less importance on perceived fit and more importance on more concrete features of the brand extension when evaluating extensions. We examine this proposition in three experiments. In study 1, we examine construal level as an individual difference variable. We compare consumers with a chronic tendency to construe their environment in an abstract way (high-level construals) with consumers having a chronic tendency to construe their environment in a more concrete way (low-level construals). In study 2, we examine construal level as a contextual variable. Here, we manipulate construal level by varying temporal distance, comparing brand extension evaluations taking place in the near future (low-level construals) versus the distant future (high-level construals). Across both studies, we find that construal level moderates the importance of perceived fit, with greater importance being placed on perceived fit in evaluating brand extensions when high-level construals are favored by consumers. Moreover, in study 3, we examine a strategy for encouraging consumers who favor low-level construals to use perceived fit as important input into brand extension evaluations. Providing a cue for the importance of perceived fit, we find that low-construal consumers respond to brand extensions as if they were high-construal consumers. That is, low-construal consumers evaluated high fit extensions more favorably than moderate fit extensions, consistent with evaluations of high-construal consumers. These findings add to the emergence of construal level theory as an important area of consumer behavior research. Very recently, researchers have linked construal levels to important aspects of consumer decision making, including the formation of consideration sets, methods for evaluating brands, and making purchase decisions (Dhar & Kim, 2007; Kardes, Cronley, & Kim, 2006; Trope, Liberman, & Wakslak, 2007). We add to this line of inquiry by examining the role of construal level in consumer response to branding strategies, specifically brand extensions. Our empirical findings are in line with the key conceptual premise of construal level theory and respond to a recent call for more research on the role of construal level in consumer behavior contexts (Liberman, Trope, & Wakslak, 2007; Lynch & Zauberman, 2007). Conceptual background