The Dual Process of Co-branded New Products: Why Fit is Not all That Matters

Marketing & Innovation Symposium (2014)
Auteurs : Fleck N., Michel G. et Gatignon H.

Co-branding strategies involve collaboration of two or more brands to launch a new product that features both brands’ names. While the focus of past research has been on the fit between the associated brands, why do sometimes incongruent brands succeed in their co-branding strategy? We explain this phenomenon by disentangling co-branding effects through two mechanisms: credibility and novelty. We demonstrate the mechanisms can operate in opposite directions leading to the possibility of different success outcomes. We find that the hedonic evaluation of a co-branded product provides a more powerful explanation through novelty than through credibility. Utilitarian evaluations, instead, are driven more strongly by credibility than by novelty. Furthermore, credibility offers full mediation between the brands’ relevancy and consumer reactions to the co-branded product. Contributing to our understanding of perceptions of novelty, brand expectancy influences the perceived novelty of the co-branded new product only if consumers also perceive this brand as relevant to the product category.
When selecting a brand to invite for co-branding a new product, it is not just a matter of fit. The results encourage managers to include measures of perceived credibility and novelty in their co-branding valuation analysis. The combination of brands has to be credible and surprising (novel). These two correspond to different processes – one cognitive, the other affective – that forge opinions and purchase likelihood. This means that management should consider carefully the relevancy and the expectancy that customers perceive about the potential brands to invite. When relevancy is sufficiently high, it is difficult to create a major surprise. Still surprise plays a role but more moderate. However, our research indicates that it is especially critical to create surprise if the invited brand is less relevant. It is then the combination of unexpectancy and relevancy that creates the perceptions of novelty. Increasing a co-branded product’s success requires improving the relevancy and unexpectancy (surprise effect) of the invited brand for the product. Marketing managers might use these results to help justify expenditures in design, communication, and retailing strategies that influence levels of perceived relevancy and unexpectancy.