Companies frequently use luxury or green as a brand extension strategy. The present research suggests that the success of the luxury or green brand extension depends on the parent brand’s core attribute-whether the parent brand is primarily luxury or green. In two experiments involving real brands (BMW, Prius, Chanel, Patagonia) across multiple product categories (automobile and bag), we investigated consumers’ evaluation of luxury green extension products (i.e., multi-attribute products with luxury and green attributes) whose parent brand is luxury (e.g., BMW) or green (e.g., Prius). Study 1 showed that luxury green products with luxury roots (i.e., parent brand is luxury) are evaluated more favorably than those with green roots (i.e., parent brand is green). Study 2 investigated the mechanism of perceived fit. Whereas luxury green product with luxury roots was perceived to have a high level of fit, the luxury green product with green roots was perceived to have a lower level of fit. Our findings encourage the luxury parent brand to extend green whereas discourage the green parent brand to extend luxury.

• Jooyoung Park(Peking University HSBC Business School, People’s Republic of China)
• Jacob C. Lee(Ulsan National Institute of Science and Technology, Republic of Korea)