The effect of brand extension strategies upon brand image

The objective of this paper is to analyze the effect that a brand extension strategy has on brand image. Specifically, the paper analyzes how variables related to the parent brand and the extension influence brand image after the extension. From a sample of 389 consumers the paper demonstrates that the extension strategy dilutes the brand image. Through a regression analysis it is shown that the perceived quality of the brand and consumers’ attitudes towards the extension positively influence both the general brand image (GBI) and the product brand image (PBI) after the extension. While familiarity with the products of the brand only affect the GBI, the perceived degree of fit affects the PBI.