A Conceptual Exploration of the Strategic Factors Driving New Brand Entry Decisions and Their Success

Abstract

New brand entry strategies, such as brand extensions and new-name brands, are increasingly being used by firms to facilitate strategic growth. Whilst the issue of new brand entry is of great strategic importance, particularly to marketing practitioners, most new brand entry research has taken a strong consumer behavior stance, with much less research being directed towards the strategic, firm-specific and market-specific drivers of new brand entry decisions and their performance. This paper takes an exploratory first step in providing a strategic management view of new brand entry by developing and introducing a conceptual framework of firm- and market-specific antecedents and moderators of two key new brand entry strategies, brand extensions and new-name brands. Specifically, this paper first explores the direct effect of a firm's resources and strategic orientation on the choice of a brand extension or a new-name brand strategy, before going onto investigate the effect of the two new brand entry strategies on performance under different environmental conditions, namely dynamism, complexity, and hostility. The paper puts forth a number of propositions and finishes off with a discussion of future research avenues.