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ABSTRACT
The Research has been undertaken in order to reveal the unique strategies that the Virgin Group employed in its extensions, and to examine whether it is really successful through strategies and how far it can go in the future. To better answer this question six study objectives are derived. The three most important ones are : to show the whole extension history of the Virgin brand, its success and failures ;to demonstrate the unique strategies Virgin employed in its brand extensions; to discover the consumers attitude towards Virgin's extensions and how far Virgin can go. In order to answer these questions, this research contains a literature review, the field research, as well as analysis and conclusion. The literature review explains the concept and main issues of brands, brand equity, and brand extension. Then the methodology is started and justified, and the investigated company and its brand extension strategies are introduced. After that the results of the survey are presented. And the conclusion is drawn according to academic literature, primary data , and secondary data.
While successful brand extensions can reap benefits, management should not forget the risk of extension failure. History shows the potential of brand extension problems, which range from out right failure to partial failures. Instead of success, the failed extension might tarnish the image and reduce the market share of the parent product. Since the brand extension decision in fact a strategic one, it is important to think strategically beyond the first extension to future growth areas. Further more, it is also important to manage those extensions strategically. Virgin group was chosen as the subject of this study because it offers great potential for studying the issue of brand extension, perhaps the best known example of successful unrelated diversification. Virgin started out as a publisher and retailer of popular music. Its brand was built up on the qualities expressed by its products. The virgin brand is now so powerful that it can be applied to diverse fields including airline, cola, financial services and even commercial space shuttles in the future. The Virgin group has a unique strategy in extending and managing its brand. They have remarkable success and some failure as well . However , to date , its successes have outweighed its failures .
.Research Objectives
The research aims to generate the following detailed research objectives. 1 To define brand image and brand extension 2 To demonstrate the consequences of brand extension. 3 To clarify the brand extension strategies. 4 To show the whole extension history of virgin brand including its successes and failures.. 5 To demonstrate the unique strategies Virgin employed in its brand extensions..
6 To discover the consumers , attitude towards Virgin's extensions and how far Virgin can go. All these objectives will be addressed through academic literature review, analysis of existing organisation data, analysis of the organisation survey and interview, and combination of the results.
Research Structure
The following research content can be divided into four sections: literature review, research methodology, primary and secondary research, and conclusion. The first section is concerned with the literature review. Before expounding the concept of brand extension, the researcher initially demonstrates the definitions of brand extension as one of the strategies in brand management emerged when brands were regarded as intangible assets gaining more attention. Brand extensions are closely linked with brand equity. Successful brand extensions result from good understanding of brand equity. Successful brand extensions result from good understanding of brand equity. After that the researcher clarifies the definition of brand extension, the consequences of brand extension, criteria in brand extension decisions, and evaluations of brand extensions. In the second section the researcher illustrates the research methodology from three dimensions: research philosophy, research approach, and research strategy. Then the collection methods of primary data and secondary data and the limitation of the methodology will be addressed. The third section is about the primary and secondary research. Secondary data will be collected and illustrated as the basis of primary research. Primary data will be collected from a standardized questionnaire survey and the data would be analyzed.
Contribution to Research
The prior literatures on brand extensions at Virgin Group clearly illustrated the unique strategies Virgin group employed to extend their brand and weighed its success and failures. This topic has been researched and represented on the basis of biographies and case studies in brand extension theories. Most of the literature has expressed doubts regarding how far the Virgin group can go with its brand. The purpose of this research is to explore those doubts mentioned above and determine how justified they are. The researcher will conduct a survey from consumers point of view to obtain the answer. The findings will show the awareness of the virgin brand and its products/services, and the attitudes of consumers towards those extensions in Virgin. Of course, all these aspects are just starting points for further research. It was impractical for the present research to obtain a comprehensive overview of Virgins extensions in general, nor was it practical to consider all existing documents, initiatives and other related information.
1.1 Introduction
In this chapter, various perspectives of brand extension theories have been reviewed as the basis of the further research. Firstly, the researcher clarifies the general concepts of brand equity. Then brand extension, one of the brand management strategies, is explained in details. The chapter ends with a summery of the literature review.
Many other brand definitions and descriptions focus on the methods used to achieve differentiation and/or emphasize the benefits the consumer derives from purchasing brands. These include definitions and descriptions that emphasize brands as an image in the consumer's minds, brand personality, brands as value systems, and brands as added value (Wood, 2000) It is possible to draw together many of the approaches to brand definition, An integrated definition can be achieved that highlights a brands purpose to its owner, and considers how this is achieved through consumer benefits. Added value is implicit to this definition (wood, 2000) that is: A brand is a mechanism for achieving competitive advantage for firms, through different (purpose). The attributes that differentiate a brand provide the customer with satisfaction and benefits for which they are willing to pay (Mechanism). According to Philip Kotler ( 1984) , A product is anything that can be offered to a market for attention , acquisition , use , or consumption that might satisfy a need or want. Thus a product may be a physical good, service, retail store, person, organization, place or idea. A Brand is a product , then , but one that adds other dimensions to differentiate it in some way from other products designed to satisfy the same need, These differences may be rational and tangible related to product performance of the brand - of more symbolic, emotional, and intangible related to what the brand represents ( Keller,1998)
creates barriers of entry that make it difficult for other firms to enter the market. Thus, to firms, brands represent enormously valuable pieces of legal property, capable of influencing consumer behavior, being bought and sold , and providing the security of sustained future revenues to their owners ( Bymer , 1991).
thing advertising agency people talk airily about when they failed to get a hard product message across' or to convert prospects' or to make sales', as they were supposed to be doing (Feldwick, 1996). Brand image' was associated with expressions like the soft sell' (Reeves, 1961) and the weak theory of advertising' (Jones, 1991), which gave it, for many, the air of a whimsical luxury that a businesslike advertiser could hardly afford (Feldwick, 1996). In the nineteen -eighties, the hardnosed business people began to notice that brands appeared to be changing hands for huge sums of money. As take-over fever spread, the difference between balance sheet valuations and the prices paid by predators was substantially attributed to the value of brands'. Suddenly, the brand stopped being an obscure metaphysical concept of dubious relevance. It was something that was worth money (Feldwick, 1996). This shift of perception was reflected in the way that the traditional expression brand image' was increasingly displaced by its solid financial equivalent, brand equity'. It is not clear who invented the expression, but few uses of it have been traced before the mid- eighties (Ambler and Styles, 1995). It achieved respectability when it was taken up by the prestigious Marketing Science Institute, which held a major seminar on the subject in 1988 and has been going strong ever since (Feldwick, 1996).
Financial perspective
The financial-market-value-based technique presented by Simon and Sullivan (1993) has been quoted in Motameni and Shahrokhi (1998) for estimating a firm's brand equity. The stock price is used as a basis to evaluate the value of the brand equities. Brand equity is defined as the incremental cash flows, which accrue to branded products over unbranded products (Simon and Sullivan, 1993). The estimation technique extracts the value of brand equity from the value of the firm's other assets. First, the macro approach assigns an objective value to a firm's brands and relates this value to the determinants of brand equity. Second, the micro approach isolates changes in brand equity at the individual brand level by measuring the response of brand equity to major marketing decisions (Motameni and Shahrokhi, 1998). Simon and Sullivan (1993) believe that financial markets do no ignore marketing factors and stock prices reflect marketing decisions.
Financial World uses one of the most publicised financial approaches in its annual listing of worldwide brand valuation (Cobb-Walgren et al,!995).They used a brand-earnings multiplier or weights to calculate brand equity, The brand weights are based on both historical data and individuals' judgments of other factors. The brand equity is the product of the multiplier and average of the past three years' profits (Motameni and Shahrokhi, 1998).
Marketing perspective
Within the marketing literature, operationalisations of brand equity usually fall into two groups: those involving consumer perceptions and those involving consumer behaviour .Keller (1998) offered a perceptual definition of customer-based brand equity: the differential effect that brand knowledge has on consumer response to the marketing of that brand. A brand with positive customer-based brand equity might result in consumers being more accepting of a new brand extension, less sensitive to price increases and withdrawal of advertising support, or more willing to seek the brand in a new distribution channel. Customer-based brand equity occurs when the consumer has a high level of awareness and familiarity with the brand and holds some strong, favourable, and unique brand associations in memory (Keller, 1998). The latter consideration is critical. For branding strategies to be successful and brand equity to be created, consumers must be convinced that there are meaningful differences among brands in the product or service category. Brand awareness is created by increasing the familiarity of the brand through repeated exposure and strong associations with the appropriate product category or other relevant purchase or consumption cues (Alba and Hutchinson, 1987). Marketing programs that link strong, favourable, and unique association to the brand in memory create a positive brand image. The definition of customer-based brand equity does not distinguish between the source of brand associations and the manner in which they are formed; all that matters is the resulting favourability strength, and uniqueness of brand associations (Keller, 1998). Cobb-Walgren, Ruble and Donthu (1995) introduced Kamakura and Russell's approach relying more on consumer behaviour in their article. They used scanner data to come up with three measurements of brand equity. First is perceived value-was defined as the value of the brand that cannot be explained by price and promotion. Second is brand dominance-provided and objective value of the brand's ability to compete on price. Third is intangible value-was operationalised as the utility perceived for the brand minus objective utility measurements (Kumakura and Russell, 1993). Aaker (1991) is one of the few authors to incorporate both attitudinal and behavioral dimensions in his definition (Cobb-Walgren et al, 1995). He has provided the most comprehensive definition of brand equity to date: A set of assets (and liabilities) linked to a brand's name and symbol that adds to firm's customers. The major asset categories are (figure 1.1): brand name awareness, brand loyalty, perceived quality, brand associations (Aaker, 1996).
Competitive Advantage
Paul Feldwick (1996) has suggested that brand equity seems to be used in three quite distinct senses, and each of these three has several further nuances of meaning. These are:
a = the total value of a brand as a separable asset-when it is sold, or included on a balance sheet. b = a measure of the strength of consumers' attachment to a brand. c = a description of the associations and beliefs the consumer has about the brand. In his point of view, looking for an operational definition of brand equity just likes asking the wrong question. Brand equity is necessarily a vague concept. It is depending on the brand's individual circumstances- and depending, importantly, on the use to which the findings will be put (Feldwick, 1996). Although a number of different views of brand equity have been expressed, they all are generally consistent with the basic notion that brand equity represents the added value endowed to a product as a result of past investments in the marketing for the brand. They all acknowledge that there exist many different ways that value can be created for a brand; that equity provides a common denominator for interpreting marketing strategies and assessing the value of a brand; and that there exist many different ways that the value of a brand can be manifested or exploited to benefit the firm(Keller, 1998).
leverage a brand's existing equity in new categories (Shocker and Weitz, 1988). Research within this stream has found that brands with higher brand equity extend more successfully (Rangaswamy et al, 1993). Other research has looked at the reverse relationship: the impact of brand extensions on brand equity. The findings are that successful brand extensions can have a positive effect on the core brand, i.e. build brand equity (Dacin and Smith, 1994; Keller and Aaker, 1992). There seems therefore to be a reciprocal relationship between brand equity and brand extensions (Ambler and Styles, 1996).
products seem to allow downscale but not upscale extension. Conversely, prestige products allow upscale but not downscale extensions (Pitta and Katsanis, 1995).
undesirable attribute associations, damaging the brand's perceived quality, or altering existing brand associations. Because the extension can dramatically affect a key asset (the brand name), both in its original setting and in the new context, a wrong extension decision can be strategically damaging (Aaker, 1991). The worst potential result of an extension is that by introducing a new product as a brand extension, the firm forgoes the chance to create a new brand with its unique image and equity (Keller, 1998).
final step in evaluating brand extension opportunities involves assessing the extent to which an extension is able to achieve its own equity as well as contribute to the equity of the parent brand.
After collecting data by means of a survey, Aaker and Keller (1990) performed an ordinary least squares (OLS) multivariate regression. The issue of fit has also been explored by Park et al. (1991). Their research supported the notion that, in evaluating brand extensions, consumers consider the perceived degree of fit between the extension and the brand. This fit relates to product feature similarity and brand concept consistency. The most positive evaluations of brand extensions are given to those that have a high degree of fit on both dimension of the brand to base the extension on. Mc William (1993) found that despite large amounts of consumer research, these key dimensions might not be discovered until after the launch and subsequent failure of the extension. The concept of fit may in fact be used more often by managers after launch as a post-relationalisation of success or failure (Barwise, 1993). Recent research has suggested that consumer acceptance can still be obtained without a close fit. For instance, Broniarczyk and Alba (1994) found that brand specific associations that are relevant to a new category could be leveraged even if the new category is quite different from the original. Thus, opportunities to exploit a brand's value are not limited to similar extension categories. Further, Dacin and Smith (1994) found that quality can be more important than fit. As such, their results also suggest that extendibility is not necessarily bounded by fit. They conclude that a brand can be gradually extended into more diverse categories as long as a high degree of quality is maintained across extensions. As this happens, fit becomes less important and the brand becomes more extendible.
1.8 Summary
The term of brand lies at the heart of marketing theory and practice. It is usually considered within the marketing strategy as part of the product and service policy (Hollensen, 2001). The emergence of brand equity concept has raised the importance of the brand in marketing strategy and provided focus for managerial interest and research activity. However, the concept has been defined a number of different ways for a number of different purpose, resulting in some confusion and even frustration with the term (Keller, 1998). The notion of brand equity is introduced in literature review in order to illustrate its linkage with brand extension. These two concepts have been coincided: a brand's equity has an impact on the success of brand extensions (Rangaswamy et al., 1993; Shocker and Weitz, 1998). And brand extensions in turn have an impact on a brand's equity (Dacin and Smith, 1994; Keller and Aaker, 1992). The understanding of a brand's equity is crucial for successful brand extensions. Because brand extensions have only recently become so prevalent, to some extent, rules guiding brand extension strategy are still emerging. The basic assumption with brand extension is that consumers have some awareness of and positive associations about the parent brand in memory and at least some of these positive associations will be evoked by the brand extension. Brand extensions offer many potential benefits but also can pose many problems. Brand extension strategies need to be carefully considered by using managerial judgment and consumer research.
Virgin started out in the 1968 with a student magazine and small mail order record company. At that time, the company called Slipped Disc Records . Richard Branson, the founder of virgin Group, picked up the doodling of his graphic designer on the floor casually. That is the way in which the famous virgin logo came to be. The first business to bear the virgin name was virgin music. From a small mail order operation, virgin music grew to become the largest independent UK record company. As virgin music became increasingly successful, it started to diversify. Now it is so powerful that it can be applied to fields as different as airlines , trains , Finance ,soft drinks , music , mobile phones , holidays , cars , wines , publishing , bridal wear , Each of these product / services divisions operates autonomously , and between them they have created over 200 companies world wide , employing over 25 , 000 people. Their total revenues around the world exceeded Sterling pounds 3 billion ( us $ 5 billion ) ( virgin . com) . To be exact , virgin's structure is more like an Asian empire , in which divisions making different products operate as separately traded companies, owning stakes in each other and sharing a name and an ethos ( Branson , 1998) . Figure 2.1 shows the developments of the virgin group from its foundation to now.
like people to feel most of their needs in life can be filled by Virgin. The Absolutely critical thing is we must never let them down ( Paul , 1997) Branson has acknowledged time and time again that most vital asset Virgin has is the reputation of its brand. Put the Virgin name on any product that does not come up to scratch and the whole company is brought in to dispute. Our customers trust us , he says simply. The Branson philosophy, then, is : look after your brand and it will last. For all his unquestioned emphasis on the integrity of the virgin name , one of Branson's personal characteristics - that has become a strand of what Virgin stands for -is a certain restlessness. He has an insatiable desire to take risks and explore new areas .Yet it is vital to do so without damaging the good name of the company. This creates something of a dilemma. It is one that Branson is well aware of ( Dearlove and Crainer , 1999). The most extreme example of Branson's restless characteristic was the launch of Virgin Atlantic Airways. In fact it was not Branson but a barrister named Randolph Fields who had got this idea firstly. However, the barrister did not have enough funding to establish an airline. At that time, Branson's most loyal lieutenants were flatly opposed to this idea, because nobody in the Virgin Group knew the first thing about airlines. But Branson could see that there was money to be made in flying the Atlantic. At the time, the existing airlines were either badly managed or could not keep up with customer demand. And Randolph Fields offered a well researched and supported proposal. Excluding those, the most important attraction was that virgin could afford to carry modest losses for a while, since they would help to reduce the tax bill on the fat profits that the record label was making. By dint of extreme effort from a team of a dozen of so people, the airline was up and flying within four months of the day which Branson first started discussing the idea with Fields (Jackson, 1995).
Branson embarks on a strategy he calls Branded Value Capital' that he allowed him to launch a hodgepodge of business with minimal investment. Essentially, Branson manages the business and puts up the virgin name , usually in exchange for a controlling interest , while his wealthy partners put up most of the cash ( Flynn et al., 1998). They provide a large slice of the capitaland take much of the risk - while the flamboyant Branson delivers the media buzz that generates sales. This strategy reduces Branson's exposure to financial catastrophe and helps Branson expand his brand around the world. Says Philip Bresford, who oversees the Britain's Richest 500 list for the Sunday Times: Branson is very, very shrewd. He lets other people pay for Virgin's expansion ( Usher,1996). But some TIME reporters thought that the freewheeling expansion could also make it hard for him to ensure the quality of all the products that bear the Virgin logo. Of course, money is not the only reason that Branson sells his company shares. He wants to turn Greater China, Southeast Asia, and Australia into Virgin territory. He made an alliance with Singapore Airlines, and then Singapore Airlines can help Virgin Atlantic Airways in offering a much wider choice of destinations in Asia with the best service on the ground , in the air , and at very competitive prices ( Virgin.com). His relationship with Patrick gets access to the skills and business flows of Patrick in freight. The Virgin Blue's terminals and / or maintenance operations could be acquired by Patrick outside the partnership. it could also extend the leverage Virgin Blue has over the dominant Quantas. It makes Virgin Blue's expansion both easier and more certain from domestic Australian routes to New Zealand, Papua New Guinea , and Bali ( Bertholameusz, 2002). As Branson said ,'I want to make Virgin the number one brand in the world , instead of around 10th , which is where it is now'( Kane ,2002)
* Good value for money; * A challenge to existing alternatives; and * A sense of fun or cheekiness ( Dearlove and Crainer, 1999) To get a sense of what this means commercially, consider that although Virgin management is inundated with requests for joint ventures and 90% of the projects it considers are profitable, none get the green light until they satisfy at least four out of these five values. Sense of fun cheekiness' and challenge to existing alternatives' is the underdog role Branson plays so well. Quality, value for money, and innovation are now regarded as must have and no longer as differentiators. Companies such as Virgin do incorporate these values, however, to remind themselves of what the brand stands for and what they believe in ( Temporal, 2002) . The launch of each new Virgin product and service come with a promise to deliver these values and the company's skill has been in spotting opportunities and leveraging the brand in to other areas ( Knobil, 1998)
consumers that the researcher would meet. The small sample data does not represent the population of all British consumers. The researcher physically meets the respondents and asks questions face to face using the interviewer administrated questionnaires. Although the questionnaire is connected to quantitative data and a deductive approach, the inductive approach is still the most appropriate.
The researcher based on the following factors selects people; 1 The researcher should select the people who r not in a hurry , because they may be more willing to answer the questions 2 Since the researcher is attempting to compare the attitudes between three age groups, there should be roughly equal respondents in each group. 3 Since the researcher is attempting to compare the attitudes of males and females, the proportion of the two should be roughly equal. The researcher intercepts the selected person and states the intent to perform an interview. If the selected person agrees to participate then the researcher reads out each question and records the response. Sixty eight people were persuaded by researcher to answer questions.
necessary for analysis, and also some data are not update. The data from company documents are mostly written from a subjective point of view of members of the organisation, which means that data may not objective. There still exists the possibility that when conducting the primary research, some respondents may encounter problems understanding or answering even though the questionnaire has been pilot tested. This survey just shows the opinion of a small number of consumers that the researcher meets with and this small sample data does not represent the population of all British consumers
Several descriptive statistics were used to analyse the data. Frequency tables and model categories were used to present and describe the data in such a way as to answer certain question types e.g. determining the most frequently occurring item. Bar charts were added to demonstrate the data more clearly. After a preliminary analysis of the seven questions using frequencies the relationship between each of the questions is analysed using Chi-square tests. The Chi-square test for independence is used to determine if two categorical variables are related. It compares the frequency of cases found in the various categories of one variable across the different categories of another variable (Pallant, 2001). If two categorical variables are significantly related, the Sig. value needs to be .05 or smaller
cornerstone of Richard Branson's branded venture capital strategy. A high level of loyalty to Virgin brand enables Richard Branson to sell most or even whole of his stakes easily. According to the answer given to question 5, the degree of agreement or disagreement with five factors related to Virgin brand is indicted Appendix B4).
* High quality
57.4% respondents agree strongly or agree somewhat that the Virgin brand represents high quality, the remaining 42.6% respondents neither agree nor disagree with this item. There is no negative attitude towards this item.
* Innovation
There is a 17.6% response disagreeing somewhat this item. While 41.2% of respondents neither agree nor disagree. This is equal to the sum of agree strongly and agree somewhat responses.
* Challenging
There is significant 22.1% disagree somewhat response and a 51.5% neither agree nor disagree response indicating that the respondents do not believe the Virgin brand represents challenging to them.
* Fun
44.1% respondents agree strongly or agree somewhat that the Virgin brand represents fun, while 51.1% respondents neither agree nor disagree with this item. There is still 4.4% disagree somewhat responses. The last two general questions deal with the age and gender of respondents. Among sixty-eight respondents, 32.4% respondents are under25 years old, 44.1% respondents are between 25 and 45 years old, and 23.5% respondents are over 45 years old. The proportion of male respondents to female respondents is roughly equal with 51.5% males and 48.5% females participating (Appendix B5).
4.3.2 Associations
The associations between age group and Virgin products/services awareness Results Without significant Differences
As is shown in appendix C, five Asymp. Sig.( 2-sided) values are larger than .05. the value are .118, .334, .236, .165, and .801 in turn. The results of these five associations indicate no significantly differences. According to figure 4.2, all three age groups have a high awareness level of the following products/services under Virgin name: Airline, Holiday, Music, and Trains. However, all three age groups have a low awareness level of Health Club under Virgin name.
name have been perceived by most consumers, which means Virgin brand are truly flexible enough to cover those products and services under this name. As discussed before, Virgin Group has a unique strategy on its brand extension. It flits from one industry to another and put the Virgin name on all of the products and services. Then it sells all or part of shares of the shares to exploit the new area. This strategy is called branded venture capital and has allowed Virgin Group to launch a hodgepodge of business with minimal investment. Some researchers criticised that this strategy is likely to damage the Virgin brand, since Virgin Group cannot ensure the quality of all the products that wear the Virgin logo. However, the results of this research show that the products and services, which are not managed by Virgin Group, still have high satisfaction level from consumers (e.g. airline, cinema, megastore, music and radio AM). The Virgin Group still can obtain benefits from this strategy. Brand extensions can be classified as either vertical or horizontal extensions (Pitta and Katsanis, 1995).The Virgin Group accomplishes its extensions in a horizontal way combining two varieties: line extensions and franchise extensions. Most of them are franchise extensions using Virgin brand name to enter product category new to the company (Tauber, 1981). For example, from record company to airline, holiday, cola, mobile, train and financial services. The example for line extensions is from Virgin Atlantic Airways to Virgin Blue. The Virgin Group has extended its brand successfully with most products and services accepted by consumers. It does happen that some consumers have dissatisfactory experiences with products or services under Virgin brand name. However, most of those consumers expressed that they will continue to buy/receive the products/services they have been dissatisfied with. And these dissatisfying experience will not influence their attitudes to Virgin brand. This research finding proved that unsuccessful horizontal extensions are less likely to damage the core brand since horizontal extensions are often in different-and more distant-product categories (Pitta and Katsanis, 1995). This finding also means that Virgin brand name has a highly loyal consumer base. As a result this base can be expected to aid new extensions under Virgin name. Well- planned and implemented extensions offer a number of advantages to companies. With a brand extension, the cost of developing a new brand, introductory and follow-up marketing programs can be reduced (Keller, 1998).Furthermore, it should be easier to add a link from a brand already existing in memory to a new product than it is to have to first establish the brand in memory and then also link the new product to it (Aaker and Carmon, 1992). The powerful Virgin brand helped Virgin Group expand its business with minimal investment successfully. The research findings reveal that the extensions under Virgin brand name, such as airline, cinema, cosmetics, megastore and radio AM are the same acceptable as the initial product-music. These successful extensions also enhance the image of Virgin brand name. When evaluating brand extensions, the issue of fit is paid more attention. Some researchers supported the notion that consumers consider the perceived degree of fit between the extension and the brand (Aaker and Keller, 1990; Park et al., 1991).Recent researchers have suggested that consumer acceptance can still be obtained without a close fit (Broniarczyk and Alba, 1994; Dacin and Smith, 1994). According to the findings of this research, the issue of fit is important in evaluating brand extensions. The Virgin Group has a large number of unrelated products and services extended under the same Virgin name. However, those unrelated extensions all fit the
associations of Virgin brand name. From that approach, these unrelated extensions are linked closely with the core brand-Virgin. The Virgin brand was initially aimed at younger people. Nowadays, the Virgin Group wants to attract elder people without losing the kids. The researcher compared the differences among three age groups. The results reveal that Virgin still appeal more to younger people rather than elder people. Younger people know about and accept more Virgin products and services especially for cinema, cosmetics, megastore, mobile, publishing and radio AM. Younger people agree more strongly with what Virgin brand standing for. Among five associations of Virgin brand, innovation, challenging and fun are that younger people strongly agreed with. Overall, Virgin is a very powerful brand name. And the Virgin Group has successfully extended this brand name during the last 35 years. With the powerful brand and loyal consumers, the Virgin Group still can use its unique strategy to extend into new areas. The Virgin Group should always be mindful that they should only put Virgin name on products and services that fit their very exacting criteria-high quality, innovation, good value for money, challenging and fun.
* The founder of Virgin Group, Richard Branson, plays an important role in Virgin's extensions. His personal image is closely linked with Virgin brand name. The Virgin Group must take one question into consideration, what will Virgin be without Branson?
2. Which of the following products are you aware of? ( Please Tick )
1. Airline _________ . 2. Cinema _________ 3. Cola _________ 4. Cosmetics _________
5. Financial Services _________ 6. Health Club _________ 7. Holiday _________ 8. Megastore _________ 9. Mobile _________ 10. Music _________ 11. Publishing _________ 12. Radio AM _________ 13. Trains _________
3. Please tick your level of satisfaction with the Virgin products/services that you have personally experienced.(please tick)
Product Very satisfied Satisfied Neither satisfied not dissatisfied Dissatisfied very Dissatisfied Airline Cinema Cola Cosmetics Financial Services Health Club Holiday
4. If you have indicated that you have been dissatisfied or very dissatisfied with one or more products what will the consequences be?(please tick)
* I will continue to buy/receive the products/services which I have been dissatisfied of very dissatisfied with. I will continue to buy / receive other products / services with the Virgin brand name._______________ * I will not continue to buy /receive the products/services which I have been dissatisfied or very dissatisfied. But I will continue to buy /receive other products services with the Virgin brand name. _______________ * I will not continue to buy/ receive the products/services which I have been dissatisfied or very dissatisfied with . And I will hesitate about buying /receiving other products /services with the virgin brand_____________ * I will not continue to buy /receive the product s/services which I have been dissatisfied of very dissatisfied with .and I will not buy /receive other products services with the Virgin Brand name.______________ * I will never buy/receive any products services with the Virgin brand name._____________
5. How strongly do you agree that the Virgin brand represents the following factors?
Agree Strongly Agree Somewhat Neither Agree Nor Disagree Disagree Somewhat
Disagree Strongly High Quality Innovation Good Value for money Challenges Fun
7. Your Gender?
Male_______ Female________ Thank you for your participation!!!!!
Appendix B
B1 Brand Awareness B2 Virgin Products Level of satisfaction B3 Consequences of Dissatisfying Experiences Frequency Percent
Valid Percent Will Hesitate about others 3 4.4 9.4 Will Just buy others 9 13.2 28.1 Will still buy 20 29.4 62.5 Total 32 47.1 100 B4 High Quality Frequency Percent Valid Percent Cumulative Percent
Neither agree nor disagree 29 42.6 42.6 42.6 Agree some what 27 39.7 39.7 82.4 Agree Strongly 12 17.6 17.6 100 Total 68 100 100 Innovation Frequency Percent Valid Percent
Cumulative Percent Disagree Somewhat 12 17.6 17.6 17.6 Neither agree nor disagree 28 41.2 41.2 58.8 Agree some what 18 26.5 26.5 85.3 Agree Strongly 10 14.7 14.7 100 Total 68
100 100 Good value for money Frequency Percent Valid Percent Cumulative Percent Disagree Somewhat 2 2.9 2.9 2.9 Neither agree nor disagree 24 35.3 35.3 38.2 Agree some what 34 50 50 88.2 Agree Strongly
8 11.8 11.8 100 Total 68 100 100 Challenging Frequency Percent Valid Percent Cumulative Percent Disagree Somewhat 15 22.1 22.1 22.1 Neither agree nor disagree 35 51.5 51.5 73.5
Agree some what 14 20.6 20.6 94.1 Agree Strongly 4 5.9 5.9 100 Total 68 100 100 Fun Frequency Percent Valid Percent Cumulative Percent Disagree Somewhat 3 4.4 4.4
4.4 Neither agree nor disagree 35 51.5 51.5 55.9 Agree some what 20 29.4 29.4 85.3 Agree Strongly 10 14.7 14.7 100 Total 68 100 100 B5 Age Group Frequency
Percent Valid Percent Cumulative Percent Under 25 22 32.4 32.4 32.4 25-45 30 44.1 44.1 76.5 Over 45 16 23.5 23.5 100 Total 68 100 100 Gender
Frequency Percent Valid Percent Cumulative Percent Male 35 51.5 51.5 51.5 Female 33 48.5 48.5 100 Total 68 100 100
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