Keller BRAND

The Impact of Corporate Marketing on aCompanys Brand Extensions

Kevin Lane Keller and David A. AakerDartmouth College and University of California, Berkeley

ABSTRACT

Despite the growing prevalence of corporatebranding activity, we have limited evidence forthe impact of corporate-level associations on thesuccess of brand extensions. This article reportsa laboratory experiment that we conducted toexamine the effects of three types of corporatemarketing activity on perceptions and evalua-tions of a proposed corporate brand extension.The findings indicate that corporate marketingactivities differentially affect consumer evalua-tions of extensions. They do so, we argue,through their impact on various dimensions ofcorporate credibility. Specifically, corporatemarketing activity related to product innovationproduces more favorable evaluations for a corpo-rate brand extension than corporate marketingactivities related to either the environment orthe community. The findings also reveal thatcorporate marketing activities influence evalua-tions of an extension even in the presence ofproduct-specific advertising.

INTRODUCTION

Building, measuring, and managing brandequity has become a top priority for manycompanies.1 One important strategicbranding decision is the proper role of thecorporate or company brand name. Com-panies choose among three principalnaming options:

to apply the corporate name to allproducts

to create brand names that are distinctfrom the corporate name

to pursue a hybrid or sub-brandingstrategy that combines the corporatename with different brand names.

When an existing brand name is used tointroduce a new product, it is called abrand extension. A company makes a pro-duct brand extension when it uses an exist-ing brand name distinct from its corporatename to introduce a new product outsideits current product offerings. With productbrand extensions, consumers are oftencompletely unaware of the companyinvolved. In contrast, a company makes acorporate brand extension when it relies on itscorporate name to launch a new product.A corporate brand extension clearly identi-fies an organization with the product, andso evokes different reactions from consu-mers than a product brand extension. Acorporate brand may create associations inconsumers minds that reflect the values,programs, and activities of the firm. Forexample, many of the strongest brands such as Sony, Hewlett-Packard, Kodak,3M, and IBM are corporate brands thatconvey organizational associations in addi-tion to product associations. These corpo-rate-level associations may be onlytangentially related to the companys pro-ducts. An important research questioninvolves asking how corporate-level asso-ciations impact the product decisions thatconsumers make, and how they evaluatebrand extensions.Extensive research has examined the pro-

cess by which consumers evaluate product

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brand extensions.2,3,4 Many researchershave also examined the conceptualization,antecedents, and consequences of corporateimage.5,6,7 Despite the prevalence andimportance of corporate branding strate-gies, relatively little research, however, hasexamined how corporate-level associationsaffect the success of brand extensions.Among the few such studies, Keller and

Aaker8 showed how the sequential intro-duction of brand extensions influencedconsumer evaluations of a corporate brandextension by affecting perceptions of cor-porate credibility. Their study examinedhow the stretch of the corporate brandwas influenced by the level of quality ofthe parent brand as well as the number andnature of intervening brand extensions.The study did not, however, examine dif-ferent types of corporate associations nordid it distinguish different underlyingdimensions of corporate credibility.This paper reports a laboratory study

that we conducted to examine several typesof marketing activity that a company canundertake to influence perceptions of itscredibility and thereby affect the evalua-tions that consumers make of extensionsintroduced under the corporate name. Spe-cifically, we consider the effects on consu-mers of providing them with informationthat identifies actions taken by a companyas being one of the following:

innovative concerned with the environment involved with the community.

We hypothesize that these common typesof corporate marketing activity will impactdimensions of corporate credibility in dif-ferent ways, and so affect consumers eva-luations of the companys brand extension.We also explore whether corporate mar-keting activity affects brand extension eva-luations when the brand extension is alsoadvertised. After developing a set of

hypotheses, we report the results of alaboratory experiment that we conductedand discuss theoretical and managerialimplications of our findings.

CONCEPTUAL BACKGROUND

Corporate marketing activities are publiclyvisible programs and actions that compa-nies initiate and that are not identified witha single product or brand sold by the com-pany. Different mechanisms can explainhow corporate marketing activities affectevaluations of a new product or service.We begin by briefly reviewing research onhow consumers evaluate brand extensionsin general before turning to the topic ofcorporate brand extensions. We then con-sider how different types of corporate mar-keting can impact consumer evaluations ofcorporate brand extensions both in the pre-sence and absence of supporting productadvertising.

Brand extension research

Research on consumer responses to exten-sions of product brands9,10,11 suggests thattwo key factors influence consumer evalua-tions:

the types of associations that make upthe parent brand image

the relationship between the parentbrand and the extension product.

These factors affect consumer beliefsabout whether the new product fits as amember of the brand line.2,3,12 Priorresearch has distinguished between func-tional or product-related associations anduser or usage-based, non-product-relatedassociations.13,14,11,12 Broniarczyk andAlba,4 however, showed that any uniquebrand-specific association can constitutefit and lead to favorable evaluations ofthe extension. In sum, the record there-fore suggests that a variety of differentassociations for the parent brand can be

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transferred to an extension, assuming abasis of fit exists. However, prior researchhas not examined closely on the role ofcorporate-level associations in influencingextension evaluations.

Corporate brand extensions

When a company uses its corporate nameon a product extension, it evokes differentassociations. A corporate brand is morelikely to evoke associations for its ownmanagers and employees, for consumerswith past or present ties to the companyand its employees, and those more familiarwith corporate activities that reflect thesocial responsibility, values, and goals ofthe company. A corporate brand can alsobe associated with features of the compa-nys product brands eg, attributes, bene-fits, and attitudes especially if thecompanys product portfolio consists ofhighly-related products. In general, how-ever, a corporate brand is more likely topossess intangible attributes or organiza-tional characteristics that span productclasses.A corporate brand can therefore influ-

ence extension evaluations in diverse ways.Since a corporate brand represents themaker of the product or service, percep-tions of the company have the potential toprovide source credibility to any productor service that the company sponsors.Source credibility is known to affect howpeople respond to persuasive mes-sages.15,16,17 For instance, Goldberg andHartwick18 found that advertiser reputa-tion affected acceptance of advertisedclaims, especially when claims were moreextreme (see also Craig and McCann andMacKenzie and Lutz).19,20

More recently, Keller and Aaker8 exam-ined the impact of corporate credibility onconsumer evaluations of new products.They define corporate credibility as theextent to which consumers believe that acompany is willing and able to deliver pro-

ducts and services that satisfy customerneeds and wants. Their findings indicatethat successful brand extensions lead toenhanced perceptions of corporate credibil-ity and to improved evaluations of dissimi-lar brand extensions. Based on pastresearch,2 they identify three dimensions ofcorporate credibility:

(1) Corporate expertise is the extent towhich a company is thought able tocompetently make and sell its productsand services

(2) Corporate trustworthiness is the extent towhich a company is thought to behonest, dependable, and sensitive toconsumer needs

(3) Corporate likability is the extent towhich a company is thought likable,prestigious, and interesting.

In the next section, we examine how speci-fic corporate marketing activities impactconsumer evaluations of a corporate brandextension. We first consider the baselinecase where the consumer knows onlyabout the company introducing the exten-sion and where no information about thenew product has been advertised.

EFFECTS OF CORPORATE MARKETING

IN THE ABSENCE OF ADVERTISING

Three major types of corporate marketingimpact evaluations of a corporate brandextension:

activities that demonstrate productinnovation

environmental concern community involvement.

We examine here the impact of thoseactivities on five key measures of extensionevaluations:

the perceived credibility of thecompany

corporate fit

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product attribute beliefs perceived quality purchase likelihood.

The first three measures are known to beimportant mediators of extension evalua-tions; the latter two are typical outcomesof interest in a brand extension.

Corporate marketing that demonstrates

product innovation

Corporate marketing activity that demon-strates a companys innovativeness typicallyinvolves developing new and unique mar-keting programs with respect to product orservice improvements and new product orservice introductions. Being a productinnovator induces perceptions of the com-pany as modern and up-to-date, investingin research and development, and employ-ing the most advanced product featuresand manufacturing capabilities.Perceived innovativeness is a key compe-

titive weapon and priority for firms inmany countries. In Japan, many consumerproduct companies such as Kao, and moretechnically oriented companies such asCanon want to be perceived as innovative.In Europe, such companies as Michelin(Driving Tire Science) and Philips Elec-tronics (Lets Make Things Better) try todistinguish themselves through their abilityto innovate and successfully invent newproducts. Similarly, such US companies as3M (Innovation Working For You) andDuPont (Better Ideas for Better Living)try hard to foster and communicate theirinnovation capabilities.

Corporate credibility

Innovative companies draw heavily ontechnology, engineering, and other specia-lized skills. A company perceived as inno-vative should therefore have higherperceived corporate expertise. Consumersmay also have more respect, liking, andadmiration for a company that is compe-

tently doing new things and finding newsolutions, thereby enhancing perceptions ofcorporate trustworthiness and likability.

Fit and beliefs

Perceived corporate innovativeness shouldinduce consumers to believe the companymore capable of generating successful newproducts outside of its area of operation,with two consquences. First, the perceivedexpertise associated with an innovativecompany should enhance perceptions of fit.Aaker and Keller2 showed how fit is basedon the perceived applicability of the com-panys manufacturing skills and assets. Adissimilar extension may seem a better fitfor a company with an innovative reputa-tion. Secondly, corporate expertise shouldincrease the likelihood that consumers willinfer an extension product to be both well-designed and well-made. Consequently,consumers should form more favorablebeliefs about specific attributes of theextension.

Evaluations

Positive perceptions of corporate credibil-ity, extension fit, and extension attributebeliefs should result in higher perceivedquality and purchase likelihood ratings fora corporate brand extension.We therefore propose the following

hypothesis:

H1: Corporate marketing activities thatdemonstrate a companys innovative-ness will increase consumer perceptionsof: corporate expertise, trustworthi-

ness, and likability fit of a corporate brand extension attribute beliefs about a corporate

brand extension quality of a corporate brand exten-

sion purchase likelihood of a corporate

brand extension.

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environmental concern

Companies indicate sensitivity to envir-onmental concerns through marketingprograms designed to protect or improvethe environment or to make more effec-tive use of scarce natural resources.Environmental concern reflects a growingsocial trend that is reflected in the atti-tudes and behavior of both consumersand corporations. Among consumers, 83per cent of Americans say they preferbuying environmentally safe products.22

Twenty-three per cent of Americans alsoreport making purchases based on envir-onmental considerations.23 Companieshave developed various green marketinginitiatives to capitalize on these trends.For instance, many leading firms (eg,GE, Disney, and Bechtel) have topgreen executives or departments thatchart environmental policy. Other firmshave built their corporate identitiesaround environmentally-friendly policies(eg, Body Shop, Ben & Jerrys, andPatagonia).

Corporate credibility

Companies perceived as environmentallyconcerned signal to consumers that thecompany is interested, not only in finan-cial matters and profits, but also inimproving the quality of life of the societyin which it operates. A probable implica-tion is that the company will be perceivedas more understanding of customer needs.Insofar as consumers believe that environ-mental concern is a worthwhile andsocially responsible corporate endeavor,these activities should result in enhancedperceptions of corporate trustworthinessand likability. Consumers may also feelthat many environmental problems requirefairly sophisticated technological solutions,suggesting that an environmentallyinvolved firm is also more likely to havespecialized expertise.

Fit, beliefs, and evaluations

Perceived environmental concern is unli-kely to improve consumer perceptions offit or increase the favorability of productattribute beliefs not related to the environ-ment. Nevertheless, insofar as consumerswant to support the environment, theymay be more inclined to evaluate a corpo-rate brand extension favorably if it comesfrom an environmentally concerned firm.Moreover, if a company is liked andtrusted, then consumers are likely to bemore comfortable and proud to buy itsproducts. An affect transfer could thereforeoperate.24,25

We therefore suggest the followinghypothesis:

H2: Corporate marketing that demon-strates a companys concern with theenvironment will increase consumerperceptions of: corporate likability, trustworthi-

ness, and expertise quality of a corporate brand

extension purchase likelihood for a corporate

brand extension.


community involvement

Companies often demonstrate communityinvolvement through marketing programsdesigned to contribute to the welfare ofthe community in which the firm is asso-ciated, as well as to society as a whole.McDonalds, Toyota, Levi-Strauss andmany others have active, visible ties tolocal communities in an effort to improvethe quality of life of local citizens. Manycompanies also participate in nationalefforts that convey a sense of socialresponsibility.26 For example, Master-Cards Make A Difference program tiescredit card usage to charitable donations.American Expresss Charge AgainstHunger campaign donates funds to feed

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the hungry based on card use. The BodyShop is active in numerous cause-relatedmarketing programs, and Ben & Jerrysdonates a percentage of its pre-tax profitsto various causes.

Credibility, fit, beliefs, and evaluations

We expect perceived community involve-ment to have similar effects as perceivedenvironmental concern. Insofar as consu-mers believe that companies should behavein socially responsible ways, they shouldfind those companies more trustworthyand likable. In turn, increased perceptionsof trustworthiness and likability shouldtranslate into more favorable ratings ofextension quality and purchase likelihood.We therefore suggest the following

hypothesis:

H3: Corporate marketing that demon-strates community involvement willincrease consumer perceptions of: corporate likability and trust-

worthiness quality of a corporate brand

extension purchase likelihood for a corporate

brand extension.

THE EFFECTS OF CORPORATE

MARKETING WITH PRODUCT

ADVERTISING

If a company heavily advertises its product,can corporate marketing activity still havean effect on extension evaluations? Weargue that the congruity or consistency ofthe advertised product positioning with thecorporate marketing activity will influencethe added value of corporate marketing. Inparticular, corporate marketing shouldprove beneficial if it reinforces and sup-ports the product positioning. Consumerexpectations are less likely to be violatedand make it easier to establish the productposition. Favorable product perceptions

and enhanced credibility in the new pro-duct context should then induce higherextension evaluations.Thus, corporate marketing that demon-

strates product innovation should help acorporate brand extension that is posi-tioned as innovative; corporate marketingthat demonstrates environmental concernshould help an extension that is posi-tioned as environmentally sensitive; andcorporate marketing that demonstratescommunity involvement should help anextension that is positioned as beneficialto the community.We therefore suggest the following

hypothesis:

H4: Corporate marketing will be moreeffective at enhancing evaluations of acorporate brand extension if productadvertising is congruent with informa-tion conveyed by corporate marketingactivities than if it is incongruent.

METHOD

Procedure

Two hundred and fifty-six upper-classundergraduate students from a majorpublic university in the western US partici-pated in this study as part of a courserequirement. Young adults aged 2025represent a key target for many marketersbecause they are just beginning to formbuying habits, and develop loyalty andpreferences. Participants were placed ingroups of 20 in large classrooms.a Theywere told that the purpose of the studywas to learn more about a new producttesting service that gathered consumerreactions to potential new products thatcompanies were considering introducing.With the service, participants were told,consumers would be given a brief com-pany description which summarized themain products of the company and somenoteworthy aspects of their business, fol-

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lowed by an ad describing a new productthat they were considering introducing.They were also told that, although theymight normally have more informationthan would be provided when they reallymade product purchase decisions, compa-nies wanted to learn what consumersthought even when they had little informa-tion. After examining the ad, subjectsresponded to a series of questions measur-ing their reactions to the company and itsnew product. The same procedure was fol-lowed for four different companies andtheir new product introductions.

Design and manipulations

The basic design of the study was a four(corporate marketing activities) by four(product positionings) full factorial design.The design was replicated for hypotheticalcompanies marketing products in fourcategories:

(1) over-the-counter drugs (aspirin andaspirin-free pain relievers and coughand cold remedies)

(2) baked goods (cakes, biscuits, cookies,breads, cake mixes, biscuit mixes, andcookie mixes)

(3) personal care products (shampoos, condi-tioners and facial soaps and skin cremes)

(4) dairy products (milk, butter, ice cream,and yogurt).

All products sold by a company used thecompanys name, including the proposednew product. We used neutral companynames that conveyed no specific productinformation. Product categories werefamiliar to all participants.Company descriptions included an

opening paragraph describing the productscurrently offered by the company, fol-lowed by two paragraphs describing thecorporate marketing activity. Corporatemarketing was manipulated to signaleither product innovativeness, environ-

mental concern, or community involve-ment. A control for no corporatemarketing was also included. Figure 1presents the complete text of the manipu-lations for the company making Baronover-the-counter drugs.Product positioning was manipulated by

the content of the ad for the new product.The new product chosen was a corporatebrand extension that was not within theproduct categories currently served by thecompany, but not so dissimilar that therewas not a basis for fit. Specifically, a pre-test sample of 40 respondents from thesame subject population as the main studywere given the first paragraph descriptionof the products currently sold by the cor-poration (as described above) and asked torate the degree of fit for proposed newproducts on an 11-point scale (0 = Extre-mely Poor Fit, 10 = Extremely Good Fit).The new products chosen were perceivedas basically moderate in fit, with ratingsthat ranged from 4.65 to 7.38.New products were positioned by ad

copy, headline, and picture in one of fourways as innovative, environmentally-sensitive, beneficial to the community, or acontrol. The first two paragraphs wereconstant across all ad types and providedsome brief introductory comments. Thefollowing paragraphs, headline, and picturethen expanded on the particular image ofthe product. For example, the ad for inno-vative positioning, showed a picture of acalendar for the year 2000. Its headlinestated that the new product was the first ofthe 21st century, noted that technologicaladvances have created new standards, andthat the product contained a breakthroughingredient or was made by a newly-patented production process. The environ-mentally-sensitive positioning ad showed apicture of a tree. Its headline stated that theproduct was good for you and good forthe environment, noted that all packaginguses material that is either recyclable or

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biodegradable and was manufacturedwith a special production process thatdoesnt harm or pollute the environment.The community-benefit positioning adshowed a picture of a panda. Its headlineappealed to help yourself and your localzoo, and stated that 25 cents would bedonated to support the local zoo for every

box sold. Finally, the control ad showed apicture of a bulls-eye and provided neu-tral, descriptive information about the pro-duct and noted that it was now available inconsumers favorite supermarkets anddrugstores. Figure 2 presents the completetext of the ads for the Baron eye dropsextension.

Corporate Descriptions (Over-The-Counter Drugs Company) Figure 1

All companiesBaron Corp. makes a variety of over-the-counter drugs. Their main product sellers areBaron Aspirin and Aspirin-Free Pain Relievers and Baron Cough and Cold Remedies.

Corporate Marketing Demonstrating Product InnovationBaron Corp. is widely recognized as being the most innovative firm in the markets inwhich they compete. Their corporate philosophy is to introduce products withtechnological advances that provide superior product performance.Baron Corps strategy to achieve that goal is to exceed competitive expenditures on

product research and development. Baron out-spends the industry average on R & D inorder that they can: 1) better understand what consumers need and want and 2) designand manufacture innovative products that better satisfy those consumer needs and wants.

Corporate Marketing Demonstrating Environmental ConcernBaron Corp. has distinguished itself selling products that are environmentally friendlyand are good for consumers. Their corporate philosophy is to make and sell products thatset industry standards for minimizing the possibility of any negative side effects to theenvironment.Baron Corps products are manufactured in plants that have received national

recognition for the ways in which they help to protect the environment. All disposableelements used in their business and manufacturing operations are recycled. Allpackaging, which is minimized to conserve resources, reduce waste and save customersmoney, is also made out of recyclable and biodegradable material.

Corporate Marketing Demonstrating Community InvolvementBaron Corp. is known for their strong involvement with the community. Their corporatephilosophy is to improve the quality of life in the communities in which their products aremade and sold. Baron Corp. believes that they can contribute to consumer satisfaction,well-being, and welfare not only by their customers consumption of Baron products, butalso by their commitment to organizations and activities that improve the cultural andspiritual sides of consumers lives too.To achieve these goals, Baron Corp. has been involved in a variety of programs. They

are one of the biggest sponsors of local activities of the United Way. They have providedsizable donations to a number of Arts functions related to symphonies, ballets, operas,folk festivals, museums, art exhibits, etc. They have also been financial supporters of anumber of youth programs related to sports, career development, and drug rehabilitation.

Control Corporate Marketing ActivityBaron Corp. has manufacturing plants in several Western States and has theirheadquarters in Phoenix, Arizona. Baron Corp. has been in business for 25 years.

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Subjects saw four of the 16 possiblecombinations of corporate marketingactivity and product positioning as aresult of crossing the corporate marketingactivity and product positioning factors toform a Latin square design. Consequently,subjects saw each type of corporate mar-

keting activity and product positioningexactly once. Subjects were randomlyassigned to the four different exposuresequences produced by the Latin square.Additionally, the exposure sequences werecounterbalanced by product category andorder of presentation so that each combi-

Figure 2 Advertising Stimuli (Eye Drops Extension)

Innovative Positioning Ad

Introducing Baron, the First Eye Drops for the 21st CenturyIntroducing revolutionary new Baron eye Drops, the sensible way to take care of youreyes. Its the perfect way to refresh and protect your eyes! Baron Eye Drops providesunsurpassed comfort to your eyes. Technological advances have produced the mosteffective eye drops ever available. Baron contains oxhydogener, a new patentedingredient that lubricates more effectively than anything previously available. Whateveryour eye care needs, Barons breakthrough new ingredient will give you fast, soothingrelief. No other eye drop can promise the same effective performance. Innovative newBaron Eye Drops has just set the standard for eye drops for the 21st century.

Environmental Positioning Ad

Baron Eye Drops are good for you and good for the environmentBaron Eye Drops are the new eye drops that are both good for you and good for theenvironment. Baron Eye Drops are the sensible way to take care of your eyes. Its theperfect way to refresh and protect your eyes! Baron Eye Drops are also made with thegood of the environment in mind. All of the packaging for Baron Eye Drops comes fromeither recyclable or biodegradable material. And it is manufactured with a specialproduction process that doesnt harm or pollute the environment. So when you use BaronEye drops, you are getting the best possible product both for you and for theenvironment.

Community Positioning Ad

Help yourself and your local zoo. Try Baron Eye DropsDo yourself a favor and try new Baron Eye Drops. Baron eye Drops are the sensible wayto take care of your eyes. Its the perfect way to refresh and protect your eyes! And forevery box of Baron Eye Drops sold, we will donate 25 cents to support your local zoo. Byhelping to preserve our natural heritage, we hope to make life a little better for everyone.When you buy Baron Eye Drops, not only do you get effective eye care for yourself, youalso help to improve the lives of the animals at your local zoo and increase theenjoyment gained by thousands of visitors. So help yourself and your local zoo. TryBaron Eye Drops.

Control Ad

Introducing Baron Eye DropsTry new Baron Eye Drops. Baron Eye Drops are the sensible way to take care of youreyes. Its the perfect way to refresh and protect your eyes! Baron Eye Drops are nowavailable in all of your favorite drugstores and supermarkets. So try new effective BaronEye Drops.

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nation of corporate marketing activityand product positioning were seen foreach product type and each position inthe exposure sequence (1st, 2nd, 3rd, or4th).To illustrate, subjects in the first expo-

sure sequence, product category, and adorder conditions evaluated:

a new sun block positioned as innova-tive from an innovation-orientedpersonal care products company(Profile)

a new rice positioned as environmen-tally sensitive from a community-oriented baked goods company (Medal-lion)

a new eye drops positioned as beneficialto the community from an over-the-counter pharmaceutical company withno specific corporate image (Baron)

a new salad dressing with no specificproduct positioning from an environ-mentally-oriented dairy productscompany (Monarch).

Measures

After examining the company descriptionand ad for the corporate brand extension,respondents completed various scales. First,they evaluated the new product on threeseven-point scales with respect to quality;three seven-point scales with measuring fit;and an eleven-point scale measuring pur-chase likelihood.Participants were then asked to rate

whether the new product matched ten dif-ferent descriptions. Four items assessedwhether consumers believed the new pro-duct possessed key attributes in the productclass,b and two items each assessed whetherthe product was seen as innovative, envir-onmentally sensitive, and beneficial to thecommunity.Finally, participants were asked to pro-

vide their reactions to the companymaking the product on seven-point scales

(higher numbers indicating greater levelsof agreement). Two items each were usedto measure company quality (has qualityproducts; has superior products), innovative-ness (innovative; has advanced products),environmental concern (good for the environ-ment; no negative side effects to the envir-onment), community involvement (good forthe local community; helpful to the localcommunity), expertise (expert; good atmanufacturing), trustworthiness (trust-worthy; concerned about customers), andlikability (likable; prestigious). Because allcomposites exhibited satisfactory reliability(coecient alphas exceeding .80), summaryscales were formed by averaging theappropriate items.Finally, three covariate measures of pro-

duct category involvement were collectedto capture the product category attitudesand behaviors of participants that couldpotentially affect their evaluations of thenew products. The measures assessed usagefrequency, knowledge, and perceived qualitydifferences among brands in each productcategory. These measures were combinedto form a scale of category involvement witha satisfactory coecient alpha reliabilityestimate of .72.

RESULTS

The hypotheses were tested by plannedcomparisons, with product category type,product category involvement, presenta-tion order, and data collection period (seeendnote a) as covariates.c Tables 1 and 2contain the means for all dependent vari-ables for the 16 cells. For ease of exposi-tion, planned contrasts are referenced bythe appropriate cell number.

Manipulation checks

Corporate marketing activity

The success of the corporate marketingmanipulation can be tested by comparing

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the effects of corporate marketing thatdemonstrate product innovation (PI),environmental concern (EC), and commu-nity involvement (CI) on the ratings for

the corresponding corporate image dimen-sions against the same ratings for the basecase (BC) where no corporate marketingactivity was reported, with no product

Table 1: Cell means of product ratings

Innovative Purchase Innovative- Environmentally CommunityCell (N) corporate Quality likelihood Fit Beliefs ness sensitive beneficial

1 (67) Innovative 5.38 6.22 5.02 5.26 5.24 4.37 4.43product

2 (70) Environmental 5.47 6.32 5.31 5.01 5.22 5.96 5.25product

3 (53) Community 5.33 5.98 5.22 5.15 4.65 5.12 5.15product

4 (69) Control 4.90 5.72 4.94 4.88 4.41 4.36 4.06

EnvironmentalCorporate




8 (69) Product 4.26 4.18 3.96 4.44 3.66 5.57 4.97control

CommunityCorporate




12 (67) Product 4.12 4.14 4.13 4.31 3.30 4.34 5.06control

ControlCorporate




16 (53) Control 3.91 3.86 4.12 4.33 3.34 4.02 3.65

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positioning information advertised in eachcase (ie, cells 4, 8, and 12 vs. cell 16). Thisanalysis reveals that the company engagedin corporate marketing activity related to

product innovation was seen as signifi-cantly more innovative (BC = 3.67, PI =5.51; p 5 .01), the company engaged incorporate marketing activity related to the

Table 2: Cell means of company ratings

Innovative Innovative- Environmentally Community

Cell (N) corporate Quality ness concerned involved Expert Trustworthy Attractive




4 (69) Control 5.57 5.51 4.43 4.45 5.46 5.29 5.09

EnvironmentalCorporate




8 (69) Product 4.75 4.69 5.77 5.25 5.00 5.21 4.78control

CommunityCorporate




12 (67) Product 4.51 4.19 4.82 5.90 4.50 5.40 4.92control

ControlCorporate




16 (53) Control 4.29 3.67 3.89 3.81 4.34 4.31 4.24

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environment was seen as significantly moreenvironmentally concerned (BC = 3.89;EC = 5.77; p 5 .01), and the companyengaged in corporate marketing activityrelated to the local community was seen assignificantly more community involved(BC = 3.81; EC = 5.90; p 5 .01) thanthe base case control.

Product positioning

The success of the product positioningmanipulation is demonstrated by compar-ing the ratings of the innovative (IP),environmentally-sensitive (ES), and com-munity-beneficial (CB) positions on thecorresponding product image dimensionsto the same ratings for the base case (BP)where no product information was adver-tised, with no corporate image informationprovided in each case (ie, cells 13, 14, and15 vs. cell 16). This analysis reveals that theproduct positioned as innovative was seenas significantly more innovative (BP =3.34, IP = 4.77; p 5 .01), the productpositioned as environmentally sensitive wasseen as significantly more environmentallysensitive (BP = 4.02, ES = 5.60; p 5.01), and the product positioned as benefi-cial for the community was seen as signifi-cantly more beneficial for the community(BP = 3.65; CB= 5.35; p 5 .01) than thebase case control.

Effects of corporate marketing activity

without product advertising

H1, H2, and H3 suggested possible effectsof corporate marketing activities on per-

ceptions of a companys credibility andperceptions and evaluations of a corporatebrand extension when no product infor-mation had been advertised. The hypoth-eses were tested by contrastingparticipants ratings when corporate mar-keting activity existed to the base casewhere no information on corporate mar-keting activity was provided, when no adswere presented. These tests involved com-parisons between cells 4, 8, and 12 againstcell 16 in Table 1.

Effects of corporate marketing activity on

perceived corporate credibility

H1a, H2a, and H3a are all supported ascorporate marketing that demonstratesproduct innovation significantly enhancedperceptions of corporate expertise, trust-worthiness, and likability (p 5 .05); corpo-rate marketing that demonstratesenvironmental concern significantlyenhanced perceptions of corporate likabil-ity, trustworthiness, and expertise (p 5.05); and corporate marketing activity thatdemonstrates community involvement sig-nificantly enhanced perceptions of corpo-rate likability and trustworthiness (p 5.05) (see Table 3). Note, however, thatalthough corporate marketing activity thatdemonstrates environmental concern led tohigher ratings of perceived corporateexpertise, these perceptions of expertisewere still significantly lower than thoseobtained from corporate marketing activ-ities that demonstrate product innovation(p5 .05).

Table 3: Corporate marketing activity effects on corporate credibility dimensionsd

Corporate Corporate Corporate Corporatemarketing activity expertise likability trustworthiness

Innovative 1.12 0.85 0.98Environmental 0.66 0.54 0.90Community 0.16 0.68 1.09

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Effects of corporate marketing activity on

evaluations of a corporate brand

extension

Only corporate marketing activity relatedto product innovation led to greater per-ceptions of extension fit and more favor-able product attribute beliefs (p 5 .01),supporting H1b and H1c (see Table 4). Asexpected, corporate marketing activityrelated to environmental concern and com-munity involvement did not have suchproduct-related effects (F 5 1).All three types of corporate marketing

activities were hypothesized to affect theperceived quality and purchase likelihoodof the extension. Only corporate market-ing activity related to product innovation,however, had a substantial impact on per-ceived quality and purchase likelihood (p5 .01), consistent with H1d and H1e.Although corporate marketing activityrelated to environment concern had a sig-nificant (albeit modest) impact on per-ceived quality (p 5 .05), consistent withH2b, it did not significantly affect purchaselikelihood (p 4 .10), failing to supportH2c. Finally, corporate marketing activityrelated to community involvement did nothave a significant impact on either measure(p 4 .10), failing to support both H3b andH3c.

Effects of corporate marketing activity in

the presence of product advertising

H4 addressed the effects of corporate mar-keting activity on evaluations of a corpo-rate brand extension when productinformation was also being advertised for

the extension. H4 asserted that corporatemarketing activity would provide a greaterimprovement in evaluations for a corporatebrand extension when it was congruentwith the advertised product positioning, ascompared to when the corporate market-ing activity was unrelated to the productpositioning information. Thus, H4 can betested by comparing how much ratings fora corporate brand extension improvedwhen information on corporate marketingactivity was provided, as compared towhen it was absent, when the productpositioning for the extension was congru-ent (cells 1 vs. 13, 6 vs. 14, and 11 vs. 15)vs. when the product positioning was dif-ferent from the corporate marketing activ-ity (cells 5 and 9 vs. 13, 2 and 10 vs. 14, 3and 7 vs. 15).Table 5 shows the improvements in per-

ceived quality and purchase likelihood forthe corporate brand extension when pro-duct positioning information was eithercongruent or unrelated to corporate mar-keting activities. For example, a productadvertised as being innovative received ahigher quality rating (+0.81) if it camefrom a company associated with innovativeproducts rather than one having a neutralreputation. All forms of corporate market-ing significantly enhanced extension eva-luations when product positioning wasboth congruent and unrelated (p 5 .05),failing to support H4 with two minorexceptions. First, corporate marketing thatdemonstrates environmental concern didnot significantly improve purchase likeli-hood ratings when the product had been

Table 4: Corporate marketing activity effectse on extension evaluations

Corporate marketing Attribute Perceived Likelihood ofactivity Fit beliefs quality purchase

Innovative 0.82 0.55 0.99 1.86Environmental 0.16 0.11 0.35 0.32Community 0.01 0.02 0.21 0.28

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positioned as beneficial to the community(p 4 .10). Corporate marketing thatdemonstrates community involvement alsodid not significantly improve purchaselikelihood when the product had beenpositioned as innovative (p 4 .10). Notethat across all product positionings, corpo-rate marketing that demonstrates productinnovation significantly improved exten-sion evaluations (p 5 .05) compared tocorporate marketing that demonstratedenviornmental concern or communityinvolvement.To examine the factors affecting exten-

sion attitudes, Table 6 shows the improve-ments in perceived fit and attribute beliefsfor the corporate brand extension when

product positioning information was eithercongruent or unrelated with corporatemarketing activity. As with extension atti-tudes, and again contrary to H4, corporatemarketing activity worked as well whenthe corporate brand extension was posi-tioned on another dimension as it didwhen the advertised product positioningreinforced the corporate marketing activ-ity. Consistent with the results for exten-sion purchase likelihood, the onlyexceptions to this pattern were that corpo-rate marketing demonstrating environmen-tal concern did not significantly improvefit or attribute beliefs when the producthad been positioned as beneficial to thecommunity (p 4 .10). Similarly corporate

Table 5: Corporate marketing activity effects on extension evaluations: The impact ofadvertised product positioningsf

Innovative Environmental Communitycorporate corporate corporatemarketing marketing marketingactivity activity activity

Productpositioning Quality Likelihood Quality Likelihood Quality Likelihood

Innovative 0.81 1.31 0.68 0.93 0.52 0.43Environment 1.10 1.61 0.60 0.88 0.54 1.25Community 1.22 1.31 0.44 0.46 0.55 1.10

Table 6: Corporate marketing activity effects on extension evaluations (cont.): The impactof advertised product positionings

Innovative Environmental Communitycorporate corporate corporatemarketing marketing marketingactivity activity activity

Product positioning Fit Beliefs Fit Beliefs Fit Beliefs

Innovative 1.06 0.47 0.68 0.51 0.47 0.30Environment 1.35 0.66 0.62 0.36 0.94 0.50Community 0.97 0.72 0.10 0.18 0.53 0.21

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marketing demonstrating communityinvolvement did not significantly improveattribute beliefs when the product had beenpositioned as innovative (p 4 .10). Addi-tionally, corporate marketing that demon-strates community involvement did notsignificantly improve fit or attribute beliefswhen the product was positioned as benefi-cial to the community (p 4 .10).

Mediating effects on extension attitudes

We developed H1-H4 based partly onassumptions concerning how corporatemarketing activity would affect differentcorporate credibility dimensions, perceivedfit, and attribute beliefs for a corporatebrand extension and how these factors, inturn, would affect extension attitudes. Toprovide further insight into these mediat-ing effects on extension attitudes, we per-formed two additional analyses. First,regression analyses were conducted basedon participants responses from all 16 cells,with mediating factors as independent vari-ables and perceived quality or purchaselikelihood as dependent variables. Theresults of both analyses were consistent andshowed that corporate expertise, corporatelikability, extension fit, and extension attri-bute beliefs all were significantly related toextension attitudes (p 5 .05).Secondly, the mediating factors were

added as covariates into the plannedcomparison model for those cells wherecorporate marketing activity had a large,significant effect on perceived quality andpurchase likelihood, ie, for corporatemarketing demonstrating product innova-tiveness. With the mediating factors pre-sent, the planned contrast for thecorporate marketing factor became statis-tically insignificant (p 4 .20). By far thestrongest predictors in these analyseswere extension fit and extension attributebeliefs, although corporate credibility,especially corporate expertise, also playedan important role in mediating the effects

of corporate marketing activity on exten-sion evaluations.These supplementary analyses lend cre-

dence to the conceptual model and theoriz-ing about how corporate marketingactivity affects perceptions of corporatecredibility, extension fit, and attributebeliefs to influence extension evaluations.

DISCUSSION

The experimental results are summarizedin Figure 3. Most importantly, the resultssuggest that corporate marketing activitycan provide a direct marketing benefit byimproving perceptions and evaluations ofa corporate brand extension. One keyadvantage of engaging in corporate mar-keting activity, creating a corporateimage, and employing a corporate brand-ing strategy is that it can facilitate theacceptance of new products. The natureand extent of that impact, however,depends on the type of corporate market-ing activity (see Figure 4).Corporate marketing activity that

demonstrates product innovation provides themost valuable enhancements to a corporatebrand extension. Specifically, it led to themost favorable perceptions of corporateexpertise and, most importantly, was theonly type of corporate marketing activityto enhance the perceived fit of the exten-sion and the evaluation of its attributebeliefs. Given the important mediating roleof these factors, it is not surprising that itwas the only type of corporate marketingactivity to increase ratings substantially ofboth perceived quality and purchase likeli-hood.Corporate marketing activity that

demonstrates environmental concern alsoprovided a number of benefits. In parti-cular, it enhanced perceptions of corpo-rate trustworthiness and likability. It hadno impact, however, on either perceivedfit or favorability of attribute beliefs forthe extension. Consequently, it had only

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a fairly modest impact on the perceivedquality of the corporate brand extension,substantially lower than that for corporatemarketing demonstrating product innova-tion, and had no significant effect on pur-chase likelihood.Corporate marketing activity that

demonstrates community involvement hadmore limited effects than the other twotypes of corporate marketing. As expected,it enhanced perceptions of corporate trust-worthiness and likability, but did not affectperceptions of corporate expertise, exten-sion fit, or extension attribute beliefs. Con-sequently, it did not increase ratings ofperceived quality or purchase likelihoodfor the extension.

Corporate marketing effects with product

advertising

The impact of corporate marketing did notappreciably differ depending on the type of

product positioning for the extension, andimproved extension evaluations in almostall cases. There are two noteworthy aspectsto this finding. First, all three types of cor-porate marketing affected consumer eva-luations of a corporate brand extensionwhen the extension had also been adver-tised. Thus, even though corporate market-ing demonstrating environmental concernand community involvement did notimprove extension attitudes when no pro-duct information had been advertisedabout the extension, these activities didhave an effect when more relevant, pro-duct-related information was made avail-able. Product information concerning theinnovativeness or environmental sensitivityof the extension appeared to be necessaryto provide sucient expertise or credibilityin the new business context. Consistentwith this conjecture, in all cases but one,better extension evaluations were linked to

Figure 3 Summary of experimental manipulations

Corporate marketing activity was manipulated by providing background information on afirm with the following emphasis:

(1) Product innovation: Reputation as innovative and its philosophy of introducingtechnologically advanced products.

(2) Environmental concern: Policy to sell environmentally friendly products andmanufacture products in an environmentally safe fashion.

(3) Community involvement: Corporate philosophy to improve the quality of life in localcommunities through various activities and programs.

(4) Control: Location and years in business.

Product positioning strategies; for these extensions were manipulated by providingadvertising information that emphasized:

(1) Innovative: Technological advances in the ingredients of the product or productionprocess.

(2) Environmentally sensitive: Environmental advantages of the product packaging andproduction process.

(3) Beneficial to the community: Corporate donations to the local zoo on the basis ofproduct sales.

(4) Control: Neutral, descriptive product information.

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greater perceptions of fit and more favorableattribute beliefs. The only exception was forcorporate marketing activity demonstratingcommunity involvement: it improvedextension attitudes when the extension waspositioned as beneficial to the communityeven though extension fit and attributebeliefs were not affected.The second important aspect to this find-

ing is that corporate marketing signifi-cantly improved extension evaluationswhen congruent, as well as unrelated, pro-duct information positioning the extensionwas advertised. The lack of congruenceand reinforcement may have been compen-sated by the fact that product positioning

information suggested credible informationabout attribute dimensions which wereweak or otherwise missing from the corpo-rate image.Finally, we note how similar were the

effects of corporate marketing on exten-sion evaluations whether or not productpositioning information had been adver-tised. In both cases, corporate marketingdemonstrating product innovation pro-vided more favorable evaluations of theextension than corporate marketingdemonstrating either environmental con-cern or community involvement. Corpo-rate marketing demonstrating productinnovation and the resulting perception of

Summary of hypothesis tests Figure 4

EmpiricalSupporta Hypotheses

H1: Corporate marketing activity related to product innovation willincrease perceptions of:

Y,Y,Y a) Corporate expertise, trustworthiness, and likability,Y b) Fit of a corporate brand extension,Y c) Attribute beliefs about a corporate brand extension,Y d) Quality of a corporate brand extension, andY e) Purchase likelihood for a corporate brand extension.

H2: Corporate marketing activity related to concern with theenvironment will increase perceptions of:

Y,Y,Y a) Corporate likability, trustworthiness, and expertise,Y b) Quality of a corporate brand extension, andN c) Purchase likelihood for a corporate brand extension.

H3: Corporate marketing activity related to community involvement willincrease perceptions of:

Y,Y a) Corporate likability and trustworthiness,N b) Quality of a corporate brand extension, andN c) Purchase likelihood for a corporate brand extension.

N H4: Corporate marketing activity will be more effective at enhancingthe evaluations of a corporate brand extension if the productpositioning information for the extension is congruent with theinformation conveyed by the corporate marketing activity than if itis unrelated.

a Y designates statistically significant support (p5 .05); N designates a failure to obtainstatistically significant support (p4 .10)

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corporate expertise appeared to make asubstantial difference in consumer judg-ments about the ability of the companyto introduce the extension.

IMPLICATIONS

We suggest five major implications fromthe findings of this experimental study.First, by showing that corporate marketingrelated to product innovation enhancesperceptions of corporate credibility andextension fit, and thus more favorableextension evaluations, this study extendsthe findings of Keller and Aaker8 thatshowed similar benefits for brands withreputations for high quality products. Thestudy also reinforces the findings of Brownand Dacin27 who showed how corporateability and corporate social responsibilityassociations can influence consumer beliefsand attitudes toward a corporate brandextension.Secondly, this study extends Keller and

Aakers8 findings by providing a moredetailed account of the relative effects ofparticular dimensions of corporate credibil-ity, namely corporate expertise, trust-worthiness, and likability. Corporateexpertise appeared to play a more influen-tial role in evaluations of a corporate brandextension than either corporate trust-worthiness or likability. The fact thatexpertise was a key predictor of extensionevaluations is also consistent with the find-ing in Aaker and Keller8 that one impor-tant predictor of extension success is theability of a firms manufacturing skills andassets to transfer from one product contextto another.Thirdly, the findings suggest the merits

of leveraging a strong brand to introduce anew product. One advantage of using abrand extension strategy to name a newproduct is that a less concerted advertisingeffort may be necessary.28 To the extentthat brand extensions are able to leverageexisting parent brand associations in consu-

mer memory, a company should find iteasier to achieve a brand image with anextension branding strategy instead ofgiving a new product a new brand name.The fact that corporate marketing activityimpacted consumer evaluations of a corpo-rate brand extension in the absence of anyproduct-specific advertising is furtherempirical support for the benefit of adopt-ing a brand extension strategy.Fourth, the fact that corporate marketing

activity significantly influenced extensionevaluations even when the extension wasadvertised on the basis of another imagedimension points to another advantage ofcorporate branding strategies. With a cor-porate branding strategy, associations cre-ated through corporate marketing permitfreedom in introductory advertising cam-paigns to communicate other productinformation about the extension. That is,because corporate image associations aremore likely to transfer to an extension onthe basis of the branding strategy, an intro-ductory advertising campaign for a corpo-rate brand extension can concentrate onother dimensions of the extension productand communicate new information aboutits unique attributes or benefits. As a result,advertising can be more impactful becauseit can provide complementary rather thanredundant information.Finally, the findings also raise important

issues about strategic emphasis. Many com-panies face tradeoffs in their brand strate-gies specifically, whether to reinforce astrong association, strengthen a weak asso-ciation, or create a new association. Insome cases, existing associations may be sostrong that they would not be responsiveto marketing actions, and companies maybe better off emphasizing other informa-tion to fortify a weak or supply a missingassociation. This research also points to thepower of innovative corporate image asso-ciations. Such associations, by affecting per-ceptions of corporate credibility and fit,

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can boost a new product that is offeredunder the corporate brand name even ifthat product is beyond the companys cur-rent product scope.

LIMITATIONS AND FUTURE RESEARCH

DIRECTIONS

The findings from this experiment werebased on consumer responses after readinga description of a well-defined, hypotheti-cal corporation and examining an ad on aforced-exposure basis for a new product itwas planning to introduce. In reality, con-sumers knowledge of, and impressionsabout, a company form and evolve as aresult of countless exposures to and experi-ences with the products, communications,and reported actions of a company.Although certain associations with a com-pany may be stronger as a result, otherscould be weaker, and, in general, the cor-porate image arising from corporate mar-keting activity may not be as well-definedas was the case here. Because certain asso-ciations making up the corporate imagesmay not be as accessible as in the experi-mental setting, the effects of corporatemarketing activity on corporate brandextension evaluations that were observedmay be exaggerated when compared withmore realistic stimuli and exposureconditions.In this light, the lack of ecacy of

corporate marketing demonstrating envir-onmental concern and community invol-vement is noteworthy. It may be thatthese types of activities have moreimpact on consumer decisions withrespect to existing products and brandsthan with new products or brand exten-sions. Certainly much corporate invest-ment in these areas is based on theexpectation that there will be a transferof affect or goodwill inducing consu-mers to do business with companies theymost like and admire. Nevertheless, asnumerous commercial studies indicate,29

positive feelings towards environmen-tally-friendly corporate actions do notnecessarily translate into more favorableproduct decisions.The circumstances by which perceptions

of corporate trustworthiness and likabilityactually influence consumer decisions mustbe identified in terms of the types of pro-ducts, consumers, and situations. For exam-ple, are the effects of corporate marketingactivity designed to benefit the environ-ment or community more likely to bemanifested under decision settings charac-terized by lower involvement than waspresent in this study? Certainly the elabora-tion-likelihood model30 would predict thatlikability and other such source perceptionsshould play a more important role in deci-sion-making as a peripheral cue when con-sumers lack the motivation or ability tomake brand evaluations. These and otherpossible moderating factors should beinvestigated in more detail.In a broader sense, this study suggests

that there are important research issuesthat remain in inter-relating corporatemarketing activities, corporate images,and corporate brand extensions. In gen-eral, marketing managers need guidelinesto help them understand how to define acorporate branding strategy that outlineswhen and how to use their corporatebrand name. Managers also need guide-lines for how to build and establish a cor-porate image and effectively managecorporate brands to improve the successand profitability of their marketing pro-grams. A more thorough examination ofthe process by which corporate marketingactivities exert their influence on consu-mers could help suggest conditions underwhich corporate image effects are moreor less likely to operate. This study pro-vides preliminary evidence for the med-iating role of various corporate credibilitydimensions and perceptions of the fit andattribute beliefs of the extension. Never-

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theless, the effects of these and othermediating factors should be explored inmore detail to better assess the causalmechanisms involved. Moreover, theeffects of corporate images on other typesof consumer decisions also should beexplored.Finally, to enhance the external validity

of the study, it would be useful to replicatethe study findings using a set of real corpo-rate brands. Since this study involved onlya limited number of product classes and astudent sample, it would be useful to sys-tematically explore these issues using abroader set of products classes and marketsegments.

ENDNOTES(a) Subjects came from two different

course offerings, separated in time byabout six months. Both data collectionefforts involved random assignment tothe 16 cells. Although there was noreason to suspect any possible contami-nating effects from the interveningtime, a check of the equality of the twosamples was conducted. Specifically,ANOVA analyses for all dependentvariables reported in the paper wereconducted with all main and interactioneffects of the corporate image andproduct positioning factors and adummy variable for data collectionperiod as independent variables. Therewere no statistically significant maineffect or interaction terms for datacollection period. Thus, the time lagbetween the two data collection periodsdid not appear to contaminate theresults in any important way. Never-theless, a dummy variable for datacollection period was added as acovariate to all planned comparisonanalyses reported below.

(b) The attribute beliefs were effective,convenient, soothing, and fast actingfor Baron eye drops; effective, conve-

nient, gentle, and strong protection forProfile sunblock; fresh tasting, conve-nient, delicious, and easy to prepare forMedallion rice; and good tasting,convenient, delicious, and easy toprepare for Monarch salad dressing,rated on a seven point scale (1 = Notat all, 7 = Very).

(c) All planned comparisons involvedbetween subject comparisons becausethey always contrasted two cells with atleast common corporate marketingactivity or product positioning (and theLatin square design meant that subjectssaw each type of corporate marketingactivity and product positioning onlyonce). Consequently, two-sided testswere employed that used the pooledmean square error from the overallANOVA analysis (with 1 and 1002d.f.), consistent with the guidelines byKeppel (pp. 428432).31 The onlysignificant covariate in the analysesbeside data collection period (seeendnote a) was product category invol-vement which, in general, was posi-tively associated with more favorableperceptions and evaluations.

(d) To illustrate how Table 2 was calcu-lated, the first entry, 1.12, results fromsubtracting the corporate expertisemean for the control corporate imageand control product positioning (cell16), 4.34, from the innovative corpo-rate image and control product posi-tioning (cell 4), 5.46.

(e) To illustrate how Table 3 was calcu-lated, the first entry, 0.82, results fromsubtracting the perceived extension fitmean for the control corporate imageand control product positioning (cell16), 4.12, from the innovative corpo-rate image and control product posi-tioning (cell 4), 4.94.

(f) To illustrate how Table 4 was calcu-lated, the first entry, 0.81, results fromsubtracting the perceived quality mean

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for the control corporate image andinnovative product positioning (cell13), 4.57, from the innovative corpo-rate image and innovative productpositioning (cell 1), 5.38.

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