Identification and investigation of effective factors on consumer's primary attitudes formation towards brand extension of pegah company of Kerman

Brand extensions have become a famous strategy for many of companies since many years ago. It’s success depends on acceptance and evaluations of consumers about brand extension. Thus,our purpose is to identify the effective factors on consumers primary attitudes formation towards brand extension of Pegah company of Kerman . We understood that external information, knowledge about parent brand/extension category, affect toward parent brand/extension category and fit perception influence attitudes toward brand extensions . Also, increasing consumer expertise, increases the rate of effect of fit perception, consumer knowledge about parent brand/extension category, affect toward parent brand/ extension category and external information on attitudes towards brand extension. Increasing consumer self-monitoring increases the rate of effect of external information on attitudes towards brand extension . Increasing consumer age decreases the rate of effect of external information on attitudes towards brand extension. Introduction Brand extension, which involves introducing new products under existing brand names, has become a popular strategy since the 1980s (Aaker ,1990). Brand extensions, which are seen as beneficial because of marketing efficiencies such as reduced new product introduction costs and increased chance of success(Aaker, 1990, Keller,1998). These benefits are mainly caused by the transfer of parent brand’s awareness and associations to the new product (Keller,1998). However, the success of brand extensions is very uncertain. According to a comprehensive study conducted by Ernst& Young and Nielson (1999) for several European countries typical, rates of brand extensions are around 80%. Often 50 million us-dollars or more are spent for the introduction of these extensions (Aaker, 1990, Sattler, 1997). The success of brand extension is largely determined by how customers evaluate the extension (Klink and Journal of Business and Retail Management Research (JBRMR) Vol 5 Issue 2 April 2011 A Journal of the Academy of Business and Retail Management (ABRM) 72 Smith,2001). Consumer evaluations of brand extensions have been investigated in a number ways. However, one of the widely accepted of fit between a new extension and its parent brand is the most important factor in determining brand extension (Aaker& Keller,1990, Muroma&Saari,1996, Zhang &Soos,2002). In order to improve success rates of brand extensions, it is important to measure the significance and relative importance of factors affecting consumer evaluations of brand extensions (Sattler,Völckner and Zatloukal,2002). Thus, we want to identify the effective factors on consumers’attitudes formation towards brand extension of Kerman Pegah company and the rate of these factors with considering consumer characteristics. 1-Literature 1-1Background: Many researchers have conducted about consumer evaluations of brand extensions. Aaker and Keller (1990) indicated that the perceived high quality of the parent brand results in positive extension evaluation. Bhat &Reddy(2001)concluded that positive feelings are directly transferred from the parent brand to the extension. Yun Ma (2005) investigated the knowledge of consumer on brand extension evaluations in his study.Henry(2008) studied the relationship between consumer innovativeness and consumer acceptance of brand extensions. Sattler, Völckner and Zatloukal (2002) examined some affecting factors on brand extensions evaluations. Bhat &Reddy(2001) studied the effect of parent brand attribute associations and affect on brand extension evaluation. Boush et al(1987) and Aaker&Keller(1990) concentrated on information process and affect transfer. Czellar (2003) proposed a model of consumer’s primary attitudes towards brand extensions. We just consider apart of this model according to below: Figure 1consumers primary attitudes formation towards brand extensions External information: Competitor and distribution activities distribution activity