"Brand Extension" is a popular strategy of new product introduction, and the use of "Family Brand" is another popular stream at brand management. Brand Extension has many benefits, but it also has the potential risk of "Negative Feedback," when the extended product fails in the market. However, it also has the potential benefit of "Positive Feedback," when the extended product succeeds in the market. Likewise, the similar aspects are expected for the Family Brand, but there are few studies on this issue.
This study focuses on the followings :
(1) For Family Brand, when does the "negative feedback" become larger in terms of the degree of similarity of extension and the types of family brand?
(2) For Family Brand, when does the "positive feedback" become larger in terms of the degree of similarity of extension and the types of family brand?
(3) Do there different patterns of these feedbacks exist between family brand name and individual products?
The results of this study are as follows. First, when the similarity of extension is too low the negative feedback is very large, and when the similarity of extension is moderate the negative feedback is very small. Second, for "prestige" family brand the negative feedback is smaller than average brand, and for the "prestige" family brand the positive feedback is greater than the average brand. Third, there are different patterns of these "negative feedback" and "positive feedback" in family brand name and individual products.
