The Impact of Cobranding on Customer Evaluation of Brand Counterextensions

Abstract

A brand that successfully extends from its parent category into a new extension category often faces a counter-extension by a brand from the extension category back into its own parent category. However, there is little guidance available on how brand extension strategies should be adjusted to mitigate the risk to the parent brand from counterextensions. This research examines the differential impact of cobranded versus solo-branded extensions on customer evaluations of brand counterextensions. It demonstrates that customers evaluate a counterextension less favorably if the preceding extension by the focal brand is cobranded than if it is solo branded. The findings suggest that cobranding not only improves the attribute profile of a brand's own extension but also helps protect the brand against counterextensions.