The role of Brand Experience in services extension
Updated: Nov 10, 2021
In the last decade, one of the themes that has had increasing relevance in the world of Marketing has been the Brand Experience, that is all the sensations, feelings, cognitions and behavioural responses stimulated by the brand. This variable, which belongs to the broader category of Experiential Marketing, has been studied in many respects, but only a few times within the context of Brand Extension, i.e. the extension of a brand into a new category, be it product or service.
The idea of this research was born from this knowledge gap, with the aim of investigating the impact of the Brand Experience in a Brand Extension process. In detail, the extension of an original service brand (Service Brand Extension) was chosen, as it is more closely linked to the Brand Experience due to its more intangible and intangible components.
The present work provides a first important contribution to such research: consumers who perceive a high Brand Experience in relation to the original brand have a much higher propensity to purchase the extension than those who perceive it at low levels. This difference is even more significant if there is a high category-to-category fit between the original brand and the extension.
The preference for a service-to-service extension in the presence of low Brand Experience and Category-to-category fit will be a recurring result in the research: in the case where consumers have an extension with low category coherence and minimal experiential components, it will be macro-similarity that will direct their choice, making them prefer to stay in the service sphere in which the brand already operates. This behaviour on the part of consumers lies in the conviction that a service-service extension may be more similar to the Service Parent Brand than a service-product extension.
The first fundamental managerial implication turns out to be linked to the importance of the Brand Experience: regardless of the direction of the extension, for a service brand that wants to extend this factor is essential to increase consumers' Willingness to buy. A suggestion then for Service Brand managers can be to target their customers with high Brand Experience to make them buy the new brand extension.
Regarding the direction of the extension there may be several relevant implications. The first concerns the situation where both Brand Experience and Category-to-category fit are present at a low level: in this case the service-to-service extension should be privileged, thanks to the contribution of similarity that increases consumers' Willingness to buy. If you target customers with a low Brand Experience by proposing an extension with low category consistency, the best strategy is to opt for another service.
For all other situations the choice between service-service and service-product is indifferent, the only exception being in the case of high Brand Affect. In this situation, if you want to propose a service-product extension to consumers with a low Brand Experience, you will need not only a high Category-to-category fit, but also a high Brand Affect. This is the only case of preference for a product extension in the whole model and these characteristics can be fundamental in the decision choice of an extension.
There does not appear to be a winning independent variable between Brand Experience and Category-to-category fit but it is essential to know how to use them depending on the situation and objectives. Furthermore, as demonstrated by the control variables, in case the objective is an extension from service to product it is essential to determine an extension category with high Category-to-category fit and to target consumers with high Brand Affect. Only in this case will the consumers' preference for a service-to-service extension, based on a similarity between macro-categories, a recurring theme of this research, be overcome.