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Linking reputations through umbrella branding

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  • Jeanine Miklós-Thal

Abstract

This paper develops a theory of umbrella branding as a way to link the reputations of otherwise unrelated products. The analysis predicts that umbrella branding can credibly signal positive correlation between the qualities of the included products to consumers, but cannot certify high quality or signal negative quality correlation. Moreover, whenever umbrella branding signals perfect positive quality correlation, firms that already sell a high (low) quality product have stronger (weaker) incentives to invest in developing another high quality product than new entrants. Copyright Springer Science+Business Media, LLC 2012

Suggested Citation

  • Jeanine Miklós-Thal, 2012. "Linking reputations through umbrella branding," Quantitative Marketing and Economics (QME), Springer, vol. 10(3), pages 335-374, September.
    • Handle: RePEc:kap:qmktec:v:10:y:2012:i:3:p:335-374
    DOI: 10.1007/s11129-012-9118-7
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    References listed on IDEAS

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    Cited by:

    1. E. Bacchiega & M. Colucci & M. Magnani, 2019. "What goes around, comes around: Reciprocal effects and double-sided moral hazard in the choice of brand licensing," Working Papers wp1136, Dipartimento Scienze Economiche, Universita' di Bologna.
    2. Sridhar Moorthy, 2012. "Can Brand Extension Signal Product Quality?," Marketing Science, INFORMS, vol. 31(5), pages 756-770, September.
    3. Suppliet, Moritz, 2020. "Umbrella branding in pharmaceutical markets," Journal of Health Economics, Elsevier, vol. 73(C).
    4. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107687899, January.
    5. J.-P. Niinimäki, 2023. "Experience Goods, Umbrella Branding, and Reputation," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 62(1), pages 33-44, February.
    6. Wilfred Amaldoss & Sanjay Jain, 2015. "Branding Conspicuous Goods: An Analysis of the Effects of Social Influence and Competition," Management Science, INFORMS, vol. 61(9), pages 2064-2079, September.
    7. Zvika Neeman & Aniko Öry & Jungju Yu, 2019. "The benefit of collective reputation," RAND Journal of Economics, RAND Corporation, vol. 50(4), pages 787-821, December.
    8. Polykarpos Pavlidis & Paul B. Ellickson, 2017. "Implications of parent brand inertia for multiproduct pricing," Quantitative Marketing and Economics (QME), Springer, vol. 15(4), pages 369-407, December.
    9. Hollenbeck, Brett, 2018. "Online Reputation Mechanisms and the Decreasing Value of Chain Affliation," MPRA Paper 91573, University Library of Munich, Germany.
    10. Nadja Silberhorn & Yasemin Boztuğ & Lutz Hildebrandt, 2017. "Does umbrella branding really work? Investigating cross-category brand loyalty," Journal of Business Economics, Springer, vol. 87(3), pages 397-420, April.
    11. Fishman, Arthur & Finkelstein, Israel & Simhon, Avi & Yacouel, Nira, 2018. "Collective brands," International Journal of Industrial Organization, Elsevier, vol. 59(C), pages 316-339.
    12. Eric Rasmusen, 2011. "Leveraging of Reputation Through Umbrella Branding with and Without Market Power," Working Papers 2011-07, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
    13. Julio J. Rotemberg, 2013. "Expected Firm Altruism, Quality Provision, and Brand Extensions," Marketing Science, INFORMS, vol. 32(2), pages 325-341, March.

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    More about this item

    Keywords

    Reputation; Umbrella branding; Brand extensions; Signaling; Quality provision; L14; L15; M31;
    All these keywords.

    JEL classification:

    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing

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