Categorisation Theory
Researchers tend to use “categorisation theory” as their fundamental theory to explore the effects of brand extension. When consumers are faced with thousands of products to choose amongst, they are not only initially confused, but try to categorise by brand association or image given their knowledge and previous experience. A consumer can judge or evaluate the extension product with his or her category memory. Consumers categorise new information into specific brand or product class label and store it. This process is not only related to consumer’s experience and knowledge, but also involvement and choice of brand. If the brand association is highly related to extension, consumer can perceive the fit among brand extension. Some studies suggest that consumer may ignore or overcome the dissonance from extension especially flagship product which means the low perceived of fit does not dilute the flagship’s equity.
Read more about this topic: Brand Extension
Famous quotes containing the word theory:
“Everything to which we concede existence is a posit from the standpoint of a description of the theory-building process, and simultaneously real from the standpoint of the theory that is being built. Nor let us look down on the standpoint of the theory as make-believe; for we can never do better than occupy the standpoint of some theory or other, the best we can muster at the time.”
—Willard Van Orman Quine (b. 1908)