The role of corporate image and extension similarity in service brand extensions

In this article we examine the role of corporate image in extending service brands to new and traditional markets in the telecommunications sector. Wi th regards to corporate image, service brand extensions are primarily assoc iated with innovation-related attributes, such as order of entry (i.e., pio neers versus followers). Increasingly, firms are extending their services t o markets that are beyond the markets that they traditionally have been act ive in. The results of an experimental study show that consumers evaluate s ervice extensions by providers with an innovative late mover image more fav ourably that service extensions by companies with a pioneer image in terms of perceived corporate credibility and expected service quality. With regar ds to these evaluation criteria, it was also found that consumers prefer se rvice brand extensions to related rather than unrelated markets. In additio n we find that the relative distance between service providers with an inno vative late mover image and pioneers is larger in related markets. (C) 2000 Elsevier Science B.V. All rights reserved. PsycINFO classification: 3900 J EL classification: M31.