Investigating the effect of the strategy of generalizing the brand name on the consumer's attitude towards the new product

Dissertation for Master's Degree

Field: Business Management, International Marketing Orientation

Abstract:

With increasing complexity and uncertainty in today's highly competitive market environment, companies have turned to brand extension techniques in order to maintain their survival and profitability. Chika Food Products Company, as one of the leading brands in food production and a brand known to the people, with more thought and consideration in offering products and looking at the development of its own brand and with the aim of gaining a position in the global markets, it intends to evaluate the effect of generalizing the brand on the attitude of its consumers. Therefore, in this research, we use Aker et al.'s model under the title of consumer evaluation of brand generalization to achieve this goal. The main purpose of this research is to investigate the relationship between perceived quality and perceived fit with consumer attitude among consumers of Chika food products in Tehran. The statistical population of this research includes all the consumers of Chika products in Tehran. To determine the sample size, Cochran's sampling method was used for the unknown population size, which is equivalent to 267 cases. In order to ensure the successful implementation of the model, the number of 100 questionnaires was added to the estimated volume, and 367 questionnaires were distributed among the sample group using the cluster random method, and then the required data and information were collected through the questionnaire and analyzed using spss and Lisrel software. The results of the research indicate that there is a positive and meaningful relationship between the degree of product complementarity, substitutability and skill transferability with the consumer's attitude, and there is also a positive and significant relationship between the perceived quality and the perceived fit with the consumer's attitude, and the main result of this research is the positive attitude of the consumers of Chika food products when faced with new products with the Chika brand.

Key words: consumer attitude, brand generalization, perceived quality, perceived fit, skill transferability, ability Substitution, complementary ability

Introduction:

In many countries, today, brand names are among the main organizational assets, and for this reason, brand name management is one of the management positions in the structure of today's organizations and is under the special support of senior management. But brand names are not the answer to all the problems of humanity, and they are not able to make a revolution in broken and perishing businesses, and bring them to the top at once, and no business can take advantage of it and travel a hundred years overnight. In the past, the world of brand names was only the concern of senior managers, while today this attitude has changed and attention to the creation and development of valuable brand names is the first priority of all businesses. Many small and large companies and organizations active in various fields of the market have established brand strategy as the main essence of their business strategy and rely on it. On the other hand, with increasing complexity and uncertainty in today's highly competitive market environment, companies have turned to brand extension techniques to maintain their survival and profitability. Therefore, when presenting their new product, managers of many companies invest in gaining customer loyalty to their brand and use their brand strategy to produce and sell their current products as well as their new products in the future. Chika food products, as one of the leading brands in the field of food production and a brand known to the people, with more reflection and contemplation on the presentation of products and the development of the self-centered brand and with the aim of gaining a place in the global markets, intends to investigate the effect of brand generalization on the attitude of its consumers.

The report of this research is presented in five chapters.

The first chapter includes the statement of the problem, main and secondary questions, research objectives, research hypotheses, Research method and specialized vocabulary.

The second chapter, while explaining the topics of brand name and brand naming strategies and the advantages and disadvantages of each and the characteristics of powerful brand names, to explanations about the consumer attitude, how it is formed and its dimensions and elements, also, the mental image about a brand name, the process of classifying objects in the minds of consumers and various views on classification, different points of view regarding the definition of brand development, types of development methods, the full definition of the variables studied in the selected model and finally the complete introduction of Chika company

The third chapter includes how to collect data (through a questionnaire) and their analysis methods.

In the fourth chapter, the analysis of the research findings using descriptive (mean, etc.) and inferential (structural equation model, etc.) statistical methods is discussed, and finally, in the fifth chapter, the results of this research are presented along with suggestions.

1-2. Statement of the problem:

When introducing a new product to the market, every company is faced with many questions. The most important issue that occupies the supplier's mind is how to introduce the new product to the market with a certain position in order to create sufficient demand or in other words, to be attractive to the market. In this regard, the position that the company adopts for its product should be based on various product characteristics, including product quality, packaging type, brand name and type. Advertising is supported. A new product may be marketed under the manufacturer's or distributor's brand name. Usually, when the producer does not have packaging and marketing facilities, or if he wants to use the reputation of the middleman's name, he sells his products under the name of the middleman's company. Some companies operate in a hybrid way, that is, they sell part of their products under their own name and another part under the name of an intermediary company. Manufacturing companies as well as distributors use different methods to choose the brand name of their products. Sometimes they market each of their products under an independent name. The most important advantage of choosing such a method is that the failure of a product will not have a negative effect on the image of the company's other products, or in other words, the company does not depend on the success of a particular product. Another advantage of using such a strategy is that choosing a new name creates a new opportunity and motivation in the market, and also motivates the company's employees. Today, most manufacturers market their new products using the brand name of previous successful products; Because one of the most valuable assets of any organization is its history and credibility with the customer. The credibility and history of any organization depends on the performance of the organization itself and the inference of the market from its performance. A successful brand can be a lever for the success of other new products of the company. A product with a successful brand can usually be sold at a higher price, has more customer loyalty, and makes it easier for consumers to choose (Doyle [1], 1990).  Between 1977 and 1984, about 40% of products introduced in US supermarkets used the same strategy, that is, extending the brand name of previous products to new products (Aker [2], 1990).  In an article from Brand Strategy magazine [3] (2005), it is mentioned that 82% of new goods have a brand name. In the same article, according to Helnwing [4], director of the Marketing Science Center [5], it is pointed out that companies have felt that they can benefit from the relationship they establish with the customer through their brand name. Managers believe that if they can introduce new products from other categories using the brand name of their successful products, they will save money. Marketing managers are not willing to accept the risk of introducing a new product with an unknown name, and based on research, 83% of marketing managers believe in offering a new product with a generalized name, and 3% of managers prefer introducing a product with a completely new name, and 15% of managers give equal weight to both strategies (same source, 2005).

In this research, considering the well-known Chika brand among the society and also the knowledge of the customers of this brand regarding the quality of these products, it is important to investigate whether according to the prevailing attitude among the consumers of this brand, the brand name can be extended to new classes of Chika products or not?

3-1. Necessity and importance of conducting research:

Nowadays, in many countries, brand names are among the main organizational capital, and one of the most important tasks of brand management is to create a favorable image in the minds of consumers. Today, brand managers use successful brand names that have a favorable image in the minds of consumers as a launching pad to present new products.