Page 1 of 9
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e-ISSN: 2395-0463
Volume 02 Issue 5
May 2016
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 234
The Role of Consumer Innovativeness on Brand
Extension Evaluation
Jessica Evangeline Selvanayagam
Department of Management, Eastern University, Sri Lanka.
Jessievan.selva@gmail.com
Abstract: This study empirically examines
the role of Consumer innovativeness in
deciding Consumer Acceptability of Brand
Extension (CAOBE). The conceptual
model of use innovative behavior is tested
for the ‘Kist’ brand in Sri Lanka. The data
was collected from a convenience sample
of 200 ‘Kist’ brand consumers through a
closed-ended questionnaire and was
analyzed using univariate and bivariate
techniques. The results reveal that
consumer innovativeness is significant and
has strong weak relationship with
acceptability of brand extension and the
higher consumers' innovativeness direct to
much positive consumer acceptability of
extended brands within the target
consumers.
Key Words: Brand Extension and
Consumer Innovativeness
INTRODUCTION
Over the last few decades failure rates of
new product have increased tremendously;
therefore, firms have reverted back to
brand extension strategy to launch new
brand, because of in-built advantages
including its high acceptability, low
promotion cost and comparatively less
chances of failures (Evangeline, S.J, &
Ragel, V.R, 2015). Despite these
advantages still companies were facing
trouble launching new brands through
Brand extension. Therefore, various
marketing researchers have been focusing
in finding the factors that consumers use
for “evaluating the brand extension”, or
the factors that invariably contributes
towards the failure or success of brand
extension strategy.
Some researchers considered consumer
innovativeness to be an important factors
significantly affecting brand extension
success (Clark and Goldsmith, 2006).
Therefore, ‘Consumer innovativeness’ has
acquired attention by recent managerial
implications and product or market
researchers as well.
Since, the Brand extension is a new
product, category or Market from an
already established brand, the novelty
plays an important role in the extended
category. Therefore it is important to come
to know how the innovative behavior of
consumers determine the acceptance of the
extensions which leads to the extensions’
success.
Therefore to know the consumer
behavioral factor “Innovativeness” that
affect the brand extension’s success is a
crucial issue for the academic researchers
and the marketing practitioners.
The ‘Kist’*, a well-known brand to Sri
Lankan consumers has made horizontal
brand extension by extending its category
from fruit based product range to
Page 2 of 9
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e-ISSN: 2395-0463
Volume 02 Issue 5
May 2016
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 235
confectionary items which can make a
significant impact on consumers’
perception of brand. (Source: Annual
Report 2011/2012, Cargills (Ceylon)
PLC, pp. 6-8).
Despite the research on consumer
innovativeness for different kinds of
product and extensions in other countries
there is no study regarding the positive
role of consumer innovativeness in the
evaluation of extensions in Sri Lankan
context. And there is a need arises to
evaluate in regard to the also, the findings
of previously discussed researches Thus,
this study is going to measure the
consumer innovativeness and its
influences in evaluation of brand extension
in regard to the brand ‘Kist’.
* Kist- This is one of the most trusted brand
names in Sri Lanka from Cargills (Ceylon) PLC
which is known by generations for delicious,
nectar range products and popular for its genuine
fruity taste. Since 2010 it is engaged in the
manufacturing, distribution and marketing of
biscuits and confectionaries under the same
brand name as a brand extension.
Objective of this study
The objective of the study is to understand
consumer use innovative behavior by
identifying the causes of use innovative
behavior and examining its causes along
with those of purchase innovative
behavior. Examination of the predictors
for innovativeness (adoption/purchase) has
a well-established research background.
Therefore the general objective of this
study is
Whether the Consumer Innovativeness
have a significant influence on Consumer
Acceptability of Brand Extension in regard
to the brand ‘Kist’?
1. LITERATURE REVIEW
The literature related to two topics—brand
extension and Consumer innovativeness—
is reviewed to obtain the conceptual
framework.
1.1.Brand Extension
According to the Klink and Smith (2001),
the success of a brand extension is largely
determined by how customers evaluate and
accept the extension. Therefore, by
understanding innovative product usage
behavior of consumers is expected the
marketers would be better able to develop
more effective extension strategies.
A more general definition of brand
extension was given by Keller (2003), who
held that “a brand extension is when a firm
uses a well-known brand name to
introduce a new product”. Bapat and
Panwar (2009) clearly recognized three
dimensions on which to evaluate brand
extensions: (a) low quality/high quality;
(b) not likely to try/very likely to try; and
(c) failure/success
1.2.Consumer Innovativeness
Following the introduction of the concept
innovativeness by Hirschman (1980), it
has expanded its construct to other
insights. One of them is ‘Consumer
innovativeness’ and it has acquired
attention by recent managerial
implications and product or market
researchers as well.
Despite the research on consumer
innovativeness for different kinds of
product and extensions in other countries
Page 3 of 9
Journal for Studies in Management and Planning
Available at http://edupediapublications.org/journals/index.php/JSMaP/
e-ISSN: 2395-0463
Volume 02 Issue 5
May 2016
Available online: http://edupediapublications.org/journals/index.php/JSMaP/ P a g e | 236
there is no study regarding the positive
role of consumer innovativeness in the
evaluation of extensions in Sri Lankan
context.
Hirschman (1980), defines, Consumer
innovativeness is a personality trait to an
individual’s receptivity to new ideas and
willingness to try new practices and
brands. For an instance, referring to the
study of Smith and Park (1992) and
Chernatony (2003), they indicate that the
innovativeness reduced the risk associated
with buying a new product or brand
according to the level of consumer
innovativeness as discussed in the last
chapter. However, there has been limited
research into the effects of consumer
innovativeness on brand extension
evaluations.
Klink and Smith, (2001) concluded that
early adopters react positively to a new
extension in the case of durable goods.
Furthermore, the authors found consumer
innovativeness as a moderating factor of
similarity, stating that consumers with
high degree of innovativeness do not base
their extension evaluation on perceived
similarity.
And also, the studies of Hem (2003) and
Klink and Smith ́s (2001) stated that the
fast moving consumer goods and services
finding positive effects of consumer
innovativeness on consumers’ evaluation
of brand extensions. Xie (2008) studied
consumer innovativeness with regard to
different types of extensions, product
information and interpersonal
communication. The study found that
innovative consumers evaluate extensions
indifferent categories more favorably than
those which present a lower degree of
similarity with the parent brand. In
addition, the availability of product
information and interpersonal
communication moderate the effects of
consumer innovativeness and the
evaluation of extensions.
Therefore, consumers who present a high
degree of innovativeness, also known as
early adopters, play a very important role
in the success of new products (Goldsmith
and Flynn, 1992), since they are more
willing to try new products and brands
(Steenkamp and Baumgartner 1992), are
less price sensitive, but more
knowledgeable about new products and
less risk averse (Rogers, 1983). Therefore,
these characteristic of early adopters affect
their purchase and learning processes
within the marketplace.
Numbers of researchers have sought
variables to better understand and predict
consumer innovative behavior. Innovative
behavior has been related to higher income
or higher spending on products, higher
product interest, higher communicated
experience, and higher perceptions of
innovation attributes (Labay and Kinnear
1981; Holak and Lehmann 1990; Mason
and Bellenger; Reynolds and Darden
1973).
As realized the precision in the related
dimensions of innovativeness in the
previous studies with the certain context,
this study is going to assess the influences
of consumer innovativeness in brand
extension evaluation based on the
dimensions such as spending/ income,
product interest, communication ability,
innovation attributes and ability to take
risk.
