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Effects of mergers and acquisitions on brand loyalty in luxury Brands: The moderating roles of luxury tier difference and social media

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  • Chung, Yerim
  • Kim, Alex Jiyoung

Abstract

This study examines the effects of the perceived evaluation of mergers and acquisitions (M&As) on the brand loyalty of consumers toward the acquired brand, the moderating effects of luxury tier differences, and the media used for delivering the M&A news. Our results reveal that the evaluation of M&As has a positive relationship with perceived brand beliefs and luxury values, and consequently on brand loyalty. The moderating effect of luxury tier differences on the relationship between M&A evaluation and perceived values is stronger when the acquiring brand is from a lower luxury tier. However, the moderating effect on the relationship between perceived values and brand loyalty is stronger when the acquiring brand is from a higher luxury tier. Social media has different moderating effects than traditional media. Our study provides useful insights into luxury brand M&As for both academics and practitioners.

Suggested Citation

  • Chung, Yerim & Kim, Alex Jiyoung, 2020. "Effects of mergers and acquisitions on brand loyalty in luxury Brands: The moderating roles of luxury tier difference and social media," Journal of Business Research, Elsevier, vol. 120(C), pages 434-442.
    • Handle: RePEc:eee:jbrese:v:120:y:2020:i:c:p:434-442
    DOI: 10.1016/j.jbusres.2019.11.030
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