Abstract:
Today most of the organizations in FMCG sector have interest on fallowing the brand
extension strategy to increase the sales of product lines the FMCG sector in Sri Lanka,
both local and multinational FMCG sector companies operate, follow the market
penetration and with brand extension strategy in a broader perspective .Brand extension
strategy is widely used because of the fact that strongly positioned brand could build and
communicate the brand values sucesfuly.Then the customers are motivated to do trial
purchasing and averse the risk of new product. However there is no empirical evidence to
understand consumer evaluation of brand extension.
The purpose of the study was to investigate the perceived quality, perceived fit and the
perceived difficulty of the consumers associated with how they behave with a brand. The
study was based on both primary and secondary data. Primary data were collected
through a survey conducted in Colombo and suburbs. The sample size was 150 customers
who were profiled with the environment of Colombo and suburbs. Data were collected
using a self administrated questionnaire with multi item scales to measure those
constructs.
The study revealed that both perceived quality and perceived fit have direct positive
effect on consumer evaluation of brand extention.Futher it found that when the extension
is fit with the original brand, it has a grater chance to trial the product resulted in brand
extension strategy. And also, the study identified that there is a significant effect of the
brand experience towards the degree of involvement of the customers for the new product
lines. Finally it further revealed the effect of the repetition A TL adv~rtising and consumer
sales promotion play a outstanding promotional role to inspire the consumers for brand
extension strategy.
