Linking Reputations: The Signaling and Feedback Effects of Umbrella Branding
AbstractThis paper develops a theory of umbrella branding as a way to link the reputations of otherwise unrelated products. I show that while umbrella branding can credibly signal positive quality correlation, there are no equilibria in which umbrella branding either fully reveals high quality, or signals negative quality correlation. Finally, whenever umbrella branding signals perfect positive quality correlation, firms that already produce high quality products have stronger incentives to invest in developing further high quality products than firms that are currently inactive or produce low quality products.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 11045.
Date of creation: 2008
Date of revision:
reputation; umbrella branding; brand extensions; quality signaling;
Find related papers by JEL classification:
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-10-21 (All new papers)
- NEP-COM-2008-10-21 (Industrial Competition)
- NEP-IND-2008-10-21 (Industrial Organization)
- NEP-MKT-2008-10-21 (Marketing)
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