Revisiting perceptual fit in co‐branding applications

Purpose – This study seeks to explore the value of using brand alliances, or co‐branding strategies, to influence consumer perceptions of new brand extensions under circumstances where the firm (parent brand) introduces new products that will be targeted to product categories within which the parent brand has a low initial degree of perceptual fit. Design/methodology/approach – Data were collected through a four‐stage questionnaire administered to 308 subjects. Hypotheses were explored through a four‐level single factor between subjects experimental design. Findings – Analyses suggest that by partnering with brands possessing higher perceived degrees of fit in the extension category (i.e. co‐brand), parent firms' brands can achieve more favorable positions for their extensions than could be realized if firms acted independently. Explained variance in perceptions of the extension increased substantially when perceptions of co‐ and parent‐brand fit were considered. Fit between the co‐brand and the new extension product apparently should be the driving factor in selecting best partnering brands for alliances. Fit between parent and partner brands may take a back seat when forming alliances. Originality/value – Current co‐branding research typically addresses the ability of brand alliances to improve perceptions of new products bearing the names of both co‐joined brands. “Perceptual fit” and brand attitudes are major constructs thought to influence the ability of brand alliances to achieve this goal. Specifically, in co‐branding applications, perceptual fit is usually conceptualized as the fit between co‐joined brands themselves, rather than fit between each co‐joined brand and the proposed new product for which both has been combined to launch. The paper's original argument is that when one brand (parent or host brand) seeks to co‐brand for purposes of improving its ability to penetrate an untested new product category, fit should be treated from a more traditional brand extension perspective. This argument is supported.