Brand extension or co-branding: The consumer's attribution of responsibility to the crossover strategies of heritage brands

Abstract

Cross-over brand extension and co-branding are effective innovation strategies for heritage brands to expand into new markets. This research compares consumers' responses to these two strategies, with the aim to address the gap in the literature and provide actionable insights for heritage brand managers. Based on the conceptual link between responsibility attribution and authenticity, and across four experimental studies, this research uncovers the advantage of brand extension over co-branding and its underlying mechanism: the serial mediation of responsibility attribution and new product authenticity. Meanwhile, the consumer's mindsets (fixed vs. growth) are identified as a boundary condition. Specifically, compared to brand extension, consumers attribute less responsibility to the heritage brand in co-branding; this in turn weakens the perception of new product authenticity, and leads to lower purchase intention for the new product. However, the disadvantage of co-branding will be neutralized when the consumer's growth mindset (vs. fixed mindset) is activated.