Luxury Brand Extension Evaluation:Fit And Ownership Effects

The consumption of luxury has been growing globally in recent years, bringing the fierce competition between luxury brands simultaneously. Brand extension is an important strategy for luxury brands to expand their markets; however, the attempts in practice turn out to be failure frequently. Research on luxury brands is still an emerging field, therefore, how can the extension of luxury brand to succeed, how do the consumers evaluate the luxury brand extension and what are the implications of the extension to the luxury brand itself are issues worth concerning.In order to study the above issues, this article explores the relationship between the brand extension fit and extended products evaluation as well as the impact of brand extension on the parent brand from the view of the luxury brand owners and non-owners.A2-level of product similarity,2-level of brand concept consistency and2-level of ownership experiment is used to explore the relationship between the variables. We find that the product similarity and brand image consistency do have an effect on the consumers’evaluation on brand extensions. But this effect varies due to diffenert ownership. The parent brand owners pay more attention to brand concept consistency, while the non-owner evaluates the extension concering more about the similarity of products. Through the comparison of the attitude toward the parent brand between the experimental group and the control group, we can find the feedback effects of brand extension on parent brand only in the owner groups.