Brand Extension Feedback: The Role of Advertising (Case Study: Tabarrok Company Products)

The companies usually use brand extension as a path to introduce their new products in the markets. Brand extension may pave the ground for entering new areas of market through producing and offering different products under existing brand and thereby decrease risks of perceived image of new product. The purpose of this study is to investigate the customers’ evaluation from familiar brand extension and the role of commercial advertisements in its success. The present study is a practical research from purpose view and is a descriptive-survey one from methodological perspective. The statistical population of this study includes consumers of Tabarrok Company in the city of Isfahan. A sample of 384 consumers has been selected from this population through random sampling method. In order to collect the research data, a standardized questionnaire has been used. The validity of the questionnaire has been examined and confirmed through confirmatory factor analysis and its reliability has been measured through Cronbachs’ Alpha Coefficient. The coefficient was 0.88 for our questionnaire by which reliability of the questionnaire has been confirmed. The hypotheses have been tested through both descriptive statistics (including frequencies, percentages, cumulative percentages, and standard deviation) and inferential statistics (including T-test, analysis of variance, Colmogorv-Smirinov, and Freedman test) in the SPSS and AMOS. The results of this study revealed that the firth, second, and third hypotheses (the effect of brand image and loyalty on the brand extension and the effect of brand extension on the brand loyalty) were rejected and other five hypotheses (the effect of brand image on the brand loyalty, the effect of brand awareness on the brand image and brand expansion, the effect of commercial advertisements on the brand image and brand loyalty) were supported. Another part of the results of this study indicated that the path coefficient of the first hypothesis (the effect of brand image on the brand loyalty) was 0.596. The coefficient was more than other coefficients. On the other hand, the path coefficient of the eighth hypothesis (the effect of brand loyalty on the brand expansion) was -0.624 which is less than other coefficients.