Consumer Evaluations of Line Extensions : A Conjoint Approach

Line extensions have been a basis for strategic growth for many firms during the past decade. The viability of line extensions largely depends on how consumers perceive the new features of the extensions. This study examined how consumers differ in their evaluations of original products and line extensions in terms of behavioral characteristics, using an individual-level conjoint analysis. Of particular interest was to compare and contrast the effects of consumer characteristics on evaluations of line extensions with those of brand extensions. A within-subjects conjoint experiment was conducted which involved rankings of full profiles of original products and line extensions. The results showed that subjects' evaluations of the new features of line extensions were influenced by three behavioral factors: perceived brand strength, perceived typicality, and product usage. Theoretical and managerial implications of the results are discussed