Factors Influencing Consumers' Brand Extension Evaluation From A Cognition Perspective

With The introduction of new products using the existing brand names has become a very common phenomenon in today's market. This strategy is defined as brand extension in the field of academy. For companies, brand extension has many advantages. The influence of the existing brand can help companies reduce advertising and promotional expenses, and also reduce the cost and risk of launching new products. I Iowever, the brand extension strategy will not necessarily win the consumers' accept. Many failure examples of companies using this strategy continue to occur nowadays. The reason is that the decision-making department of many companies didn't consider how consumer would look at their brand extension strategies. If consumers do not accept the brand extension, not only will they not pay for the new products, but also the brand's existing products will be implicated. Because the abuse of brand extension strategy will result in that the consumers' awareness of their existing brand gradually blur, and their brands gradually disappear in the product decision-making collection when consumers consider to buy some product.After all, the success of the brand extension largely depends on the consumers' evaluation of the brand extension. In the past study of brand extension effect, the research focus on the products that have been already launched to the market, building the brand extension performance system based on objective factors such as the price of extension product. However,the research on factors influencing consumers' cognitive evaluation of the brand extension is comparatively rare. In fact, the behavior decision-making of consumers is just the appearance of their psychological decision-making activities. Studies on the influencing factors of consumers'cognitive decision in brand extension can help companies predict the possible reaction to the consumers before the new product is really launched, and enhance the quality of their brand extension practices, result in better evaluation of consumers' brand extension.In this paper, we choose Li Ning and Nike, which are well-known brands in the domestic sports brand market. In use of the heuristic and systematic theory model of psychology, we study the difference of cognitive factors which have influence on customers' brand extension evaluation between the international brand like Nike and the local brand like Li Ning. Based on the questionnaire survey, the collected data were analyzed by SPSS and Amos, and the heuristic and systematic factors influencing the brand extension information were measured and analyzed by structural equation model. The results show that the brand association,parent brand reliability and the perceived quality of parent brand have a significant positive influence on the brand extension evaluation in the processing of extension information of both Li Ning and Nike. Among the factors, the brand association and the perceived quality of the parent brand are most significant. As a result, this study also indicates that the cognitive process of consumers' brand extension is influenced not only by the heuristic factors but also by the systemic factors. And the systemic factors have much more influence than the heuristic factors. What' s more, in the brand extension evaluation of Nike the consumers' experience and the cognition of brand personality play a significant positive influence, but this is not significant in the consumers' brand extension evaluation of Li Ning.