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Brand dilution effect of extension failure – a Taiwan study

Arthur Cheng‐Hsui Chen (Associate Professor, Department of Business Administration, National Yunlin University of Science & Technology, Taiwan, Republic of China)
Shaw K. Chen (Professor and Director, College of Business Administration, University of Rhode Island, Kingston, Rhode Island, USA)

Journal of Product & Brand Management

ISSN: 1061-0421

Article publication date: 1 July 2000



Examines the negative impacts of brand extension failure upon the original brand by calibrating the difference of brand equity. Using data collected from college students in Taiwan, establishes four hypotheses to identify various effects of a failed brand extension in diluting the original brand’s equity. Analyzes the different effects among four types of equity‐source brands for both close and distant extensions. Equity‐source and equity level of the original brand is identified first. All components of brand equity‐source are then used to evaluate the performance of a brand extension. Finds that an unsuccessful brand extension dilutes the original brand for all three high equity‐source brands. Effects of brand dilution differ according to the type of equity source possessed by the original brand, but there is no difference in brand dilution effects from close and distant extension failures.



Cheng‐Hsui Chen, A. and Chen, S.K. (2000), "Brand dilution effect of extension failure – a Taiwan study", Journal of Product & Brand Management, Vol. 9 No. 4, pp. 243-254.




Copyright © 2000, MCB UP Limited

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