商科report/research/essay/assignment/paper写作- Business Research

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Journal of Business Research 69 (2016) 5768–5774

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Journal of Business Research

Ingredient branding for a luxury brand: The role of brand and product ﬁt☆
Hakil Moon a,⁎, David E. Sprott b
a Eastern Michigan University, College of Business, Department of Marketing, 300 West Michigan Avenue, Ypsilanti, MI 48197, USA
b Washington State University, Carson College of Business, Department of Marketing, PO Box 644750, Pullman, WA 99164, USA
a r t i c l e

i n f o

a b s t r a c t

Many ﬁrms adopt an ingredient branding strategy when introducing new products, whereby a host brand integratesa branded ingredient. Research suggests that perceived ﬁt between the host and ingredient brands should inﬂuencethe success of such brand partnerships. Not all ﬁrms, however, may be able to ﬁnd appropriately ﬁtting brandedingredients, such as luxury brands which may ﬁnd it nearly impossible to partner with other luxury brands andtherefore need to consider non-luxury partners. The current research examines consumer responses to areal-world ingredient partnership between a luxury host brand (TAG Heuer) and non-luxury ingredients (Inteland Google), who have come together to produce a new product (a luxury smartwatch). Results of a study ﬁndthat ﬁt between the brand partners (based on both brand image and product category) positively inﬂuencespurchase intentions with consumer’s perceptions of a brand’s luxury nature moderating observed effects. Theresearch provides implications for product strategy and marketing of luxury brands.

Received 1 September 2015
Received in revised form 1 February 2016
Accepted 1 April 2016
Available online 6 June 2016
Keywords:
Luxury brand
Ingredient branding
Brand image ﬁt
Product category ﬁt
1. Introduction
A popular trend in the marketplace is the incorporation of a branded
ingredient within the product(s) of a different brand (e.g., Desai &
Keller, 2002), such an ingredient branding strategy serves as an impor-
tant marketing tactic for brands to enhance market competitiveness.
Firms integrate branded ingredients in a variety of product categories
ranging from durables (e.g., Ford’s consumer-facing electronic systems
are branded by Microsoft) to non-durables (e.g., Breyer’s ice cream
contains Reese’s Pieces candies). This strategy provides value to both
brands, in terms of relationship beneﬁts such as mutual cooperation and
knowledge sharing (Erevelles, Stevenson, Srinivasan, & Fukawa, 2008).
For example, a host brand (such as Ford) may enjoy an enhanced market
reputation, while the ingredient brand (Microsoft in this case) may
beneﬁt by reducing the probability of entering competition.
Academic research on ingredient branding has examined the deter-
minants of success for this strategy (e.g., Desai & Keller, 2002), as well as
subsequent spillover effects on the host and ingredient brands
(e.g., Rodrigue & Biswas, 2004). This research ﬁnds that the branded
ingredient can inﬂuence consumer attitudes toward the host brand
both positively and negatively (e.g., Balachander & Ghose, 2003; Votola
& Unnava, 2006). In contrast to its prevalence in practice, ingredient
branding has received relatively little attention in the literature (espe-
cially, compared to related topics such as brand extensions and brand
☆ The authors are grateful for the comments of anonymous reviewers.
⁎ Corresponding author.
E-mail addresses: hmoon3@emich.edu (H. Moon), dsprott@wsu.edu (D.E. Sprott).
http://dx.doi.org/10.1016/j.jbusres.2016.04.173
0148-2963/© 2016 Elsevier Inc. All rights reserved.

alliances). The current research addresses this situation by exploringhow perceived ﬁt between the host and branded ingredient can inﬂuenceconsumer reactions to ingredient branding partnerships—an issueuntested within the literature.

Research demonstrates ﬁt to be an important factor in the successof brand extensions and brand alliances. For example, research onconsumers’ responses to brand extensions ﬁnds that higher (lower)degrees of ﬁt between a parent brand and its extension positively(negatively) inﬂuences consumers’ attitudes toward the extension(e.g., Sattler, Völckner, Riediger, & Ringle, 2010; Sjödin, 2008). Ameta-analysis by Völckner and Sattler (2006) ﬁnd that ﬁt is themost inﬂuential factor in terms of brand extension success; an importantﬁnding given that 8 of 10 new products fail upon introduction. Fitcaptures the similarity between two brands (e.g., the parent brand andits extension) in one of two ways: Product ﬁt reﬂects the extent towhich consumers perceive the product categories of the two brands tobe compatible (e.g., the parent brand and its extension). On the otherhand, brand ﬁt is a consumer’s perception regarding the degree of consis-tency between the two brand images (Czellar, 2003; Simonin & Ruth,1998). The current research proposes that due to the unique collaborativenature of ingredient branding strategies, ﬁt (as studied in the brandalliance and extension literatures) is applicable to ingredient brandingand should be a factor that host brands consider when deciding whoto include as a branded ingredient.

While ﬁt between the host and ingredient brands is likely to be animportant factor for the selection of partners, not all ﬁrms may be ableto ﬁnd perfectly ﬁtting branded ingredients. An example is the producerof luxury brands (one of the most proﬁtable and fastest-growing brandsegments; Kim & Ko, 2012) who may ﬁnd partnering with other luxury

H. Moon, D.E. Sprott / Journal of Business Research 69 (2016) 5768–5774

manufacturers extremely difﬁcult. Indeed, given the relatively few luxury
brands within product categories (as reduced supply helps build the
symbolic image of the brand; Park, Jun, & Shocker, 1996), luxury brand
manufacturers may need to look to non-luxury brands as potential part-
ners. A recent marketplace example of this situation is TAG Heuer’s
brand partnership with Intel and Google to produce the world’s ﬁrst
luxury Android-based smartwatch (IntelPR, 2015). Of the various smart
devices, the smartwatch (which includes various functions ranging from
pulse detection to messaging via voice commands) is one of the strongest
growing product variants. TAG Heuer’s decision to partner in this category
perhaps comes as no surprise given the quickly growing market for wear-
able devices, which may top $32.2 billion by 2019 (up from $18.9 billion
in 2014; Kharif, 2015) and the need for technology beyond that of a
typical manufacturer of luxury watches. Although partnering with Intel
and Google is a reasonable decision for TAG Heuer, a possible disadvan-
tage of such a partnership is the potential lack of ﬁt between the luxury
branded watchmaker and the technology-oriented partner brands.
Thus, the current research delves into this situation by exploring how
the ﬁt between a luxury host brand and non-luxury branded ingredient
can inﬂuence consumers’ reactions to a new product.
The structure of this paper is as follows. In the next section, ingredi-
ent brand and relevant branding literatures are reviewed, followed by
the development of hypotheses regarding the effect of ingredient
brand ﬁt on consumers’ responses to a new luxury product. Building
on the TAG Heuer example, the method, data and results of a study
are reported that test focal hypotheses. Finally, managerial implications
and future research directions are outlined.
1. Conceptual framework and hypotheses
2.1. Luxury brands
The global market for luxury goods has grown over the past two
decades. Although the number of ﬁrms within this industry is small,
the industry has considerable potential due to its increasing sales
volume (Ko & Megehee, 2012). Total revenues of luxury goods in 2014
was $282 billion representing a 29% increase from 2013; this in the
face of weakening demand in China (the number 1 luxury goods buyer)
and economic weakness in Europe (the number 2 buyer; Reuters New
Agency, 2014). Marketing of luxury goods is complex and frequently
counter-intuitive compared to marketing of non-luxury goods (Tynan,
McKechnie, & Chhuon, 2010), prompting some to comment that “classical
marketing is the surest way to fail in the luxury business” (Kapferer &
Bastien, 2009, p. 2). For example, Albrecht, Backhaus, Gurzki, and
Woisetschläger (2013) argue that luxury brand extensions differ in
key aspects from the extensions of non-luxury brands. Similarly, Park,
Lawson, and Milberg (1989) argue that memory representations of
non-luxury brands are based on concrete attributes whereas associations
for luxury brands are more abstract, a difference that might lead to differ-
ent modes of cognitive processing.
Given the market importance of luxury brands, academics are begin-
ning to explore a variety of topics regarding these unique brands. Current
research on luxury brands has studied the nature and deﬁnition of luxury
goods (e.g., Vigneron & Johnson, 2004), the online presence of luxury
brand marketing (e.g., Kim & Ko, 2012), the perceived value of luxury
brands by consumers (e.g., Shukla & Purani, 2012), the management
of luxury brands (e.g., Albrecht et al., 2013), luxury consumer behavior
(e.g., Bian & Forsythe, 2012), and counterfeiting of luxury brands
(e.g., Randhawa, Calantone, & Voorhees, 2015). Despite the emerging
literature on luxury brands, little research has examined the role of
brand partnerships for luxury brands, even though real-world examples
of ingredient brand partnerships exist for luxury brands (e.g., the current-
ly available Apple and Hermes smart watch). In response, the current
research takes up this issue by examining the value of a brand ingredient
strategy for luxury brands.

2.2. Ingredient branding

Ingredient branding in which key attributes of one brand are incorpo-rated with a host brand is a popular strategic marketing tool (Desai &Keller, 2002). Ingredient branding can be an essential growth driver forbrands due to increased product differentiation and greater marketshare (Swaminathan, Reddy, & Dommer, 2012). The association betweenthe host and ingredient brand can enhance ﬁrm performance, as ingredi-ent branding involves the transfer of knowledge and emotions betweenthe two brands. For example, the host can beneﬁt by overcoming weak-nesses it may have in a product category and broaden its appeal by asso-ciation with the branded ingredient (Park et al., 1996). The ingredientbrand may also beneﬁt from greater awareness by becoming part of thehost; well-known brands such Intel, Gore-Tex, and NutraSweet haveachieved prominence in part due to their being ingredient brands(Kotler & Pfoertsch, 2010). Further, both brands can reduce new productdevelopment costs by sharing knowledge required for new productdevelopment and launch.

Extant research on ingredient branding has examined a variety oftopics, including the determinants of ingredient branding success(Desai & Keller, 2002), spillover effects on the parent brand subsequentto an ingredient brand partnership (Simonin & Ruth, 1998), strategiccompetency of the branding strategy (Park et al., 1996), and the impactof these branding strategies in a B2B context (Erevelles et al., 2008).Given evidence provided by prior research, an ingredient banding strat-egy offers potential for brand managers to increase proﬁts and enhancethe images of their brands, along with providing products that createvalue for customers. However, in spite of this emerging literature oningredient branding, little research has examined the use this strategyfor luxury brands.

While research has yet to explore luxury ingredient branding, exam-ples of such partnerships are not uncommon in the market with luxurybrands serving as both the host and the ingredient. For example, Bentley(the luxury car manufacturer) offers Wilton carpet options as an ingre-dient brand in its automobiles, but also serves as an ingredient (in termsof custom designed seating) at the luxury Pankhurst London barber-shops. The logic of these partnerships is expressed well on the Bentleywebsite noting that: “Both Bentley and Pankhurst London share a com-mitment to peerless quality, contemporary style and modern luxurywhich combine to make the partnership one of true excellence(Bentley Motors, 2013).” Not all ingredient brand partners, however,are between two luxury brands. For example, Panasonic and Leicahave had a long-standing partnership, whereby Panasonic (a non-luxury brand) contributes digital technology to Leica (a luxury brand)and Leica contributes its lenses as an ingredient to Panasonic cameras.This synergistic relationship has allowed both companies to boost productcompetitiveness by combining strengths of each partner (i.e., Leica’soptical technology and Panasonic’s digital technology).Partnerships between a luxury brand and a non-luxury ingredientbrand (such as the partnership between Leica and Panasonic) are notsurprising, given the limited number of luxury brands in the marketplace;this is especially the case regarding technology where there are few, ifany, true luxury technology brands. As noted earlier, however, priorresearch indicates that ﬁt between an ingredient brand and its host iscritical to the success of the strategic partnership (Swaminathan et al.,2012). Given the lack of research on the topic and variance in ingredientbranding strategies among luxury brands, the current research exploresconsumers’ reactions to the use of non-luxury ingredients in the productof a luxury brand.

2.3. Brand image and product category ﬁt

The brand extension and brand alliance literatures report extensiveresearch on the concept of perceived ﬁt (e.g., Lafferty, Goldsmith, &Hult, 2004; Park, Milberg, & Lawson, 1991; Völckner & Sattler,2006). This research clearly suggests that perceived ﬁt is criticalH. Moon, D.E. Sprott / Journal of Business Research 69 (2016) 5768–5774

when considering branding strategies that involve new products. For
example, research shows that the most important factor inﬂuencing
brand extension success is the ﬁt with a parent brand (Völckner &
Sattler, 2006). Much of this work builds from categorization theory,
whereby ﬁt inﬂuences information transfer from the parent brand
to its extension (in the case of brand extensions), with such transfer
more likely to occur with higher levels of ﬁt (e.g., Boush et al., 1987).
If the parent brand has strong, favorable, and unique associations in
memory, then consumers will evaluate a ﬁtting extension more
favorably, as opposed to a poorly ﬁtting one (Aaker & Keller, 1990).
Building on these ﬁndings, the current research assumes that ﬁt is
likely to play an important role in consumers’ response to ingredient
brand partnerships.
Ingredient brand research ﬁnds that the ingredient brand inﬂuences
consumer attitudes toward the host brand both positively and negatively
(e.g., Balachander & Ghose, 2003; Votola & Unnava, 2006), and vice versa.
The premise underlying the current research is that these basic effects will
be inﬂuenced by the perceived ﬁt of brands within the ingredient brand-
ing partnership. Despite the considerable research on ﬁt in the contexts of
brand extensions and alliances, little research has examined ﬁt within
ingredient brand partnerships (particularly those involving luxury and
non-luxury brands). One exemption is a recent paper that shows higher
degrees of perceived ﬁt between the host and ingredient brands positive-
ly inﬂuences a ﬁrm’s performance (e.g., Swaminathan et al., 2012). This
research, however, focuses on the impact of ﬁt in the context of a non-
luxury brand. As noted by Vickers and Renand (2003), luxury brands
differ from non-luxury brands due to their inherent features
(e.g., stronger symbolism and experiential beneﬁts), thus one can
reasonably expect different judgments of ﬁt regarding a luxury ingredient
brand partnership. In particular, this factor suggests that ﬁt between a
brand and an ingredient will inﬂuence consumer’s purchase intentions
for a new product offered by a luxury brand.
While the concept of ﬁt at ﬁrst glance may seem like a straightfor-
ward concept, an examination of the brand extension literature ﬁnds
that its application varies across research. In some papers, ﬁt involves
the product category (e.g., Bhat & Reddy, 2001), while others consider
ﬁt as related to a brand’s image (e.g., Choi, Liu, Liu, Mak, & To, 2010). It
may come as no surprise that much research does not address the
different conceptualizations of ﬁt (Aaker & Keller, 1990; Sattler et al.,
2010), even though some have argued the importance of considering
such differences (e.g., Czellar, 2003). In terms of the current research,
product category and brand image ﬁt are proposed to be differentially
important when consumers consider a product offered by a luxury
brand (e.g., TAG Heuer) that includes a non-luxury ingredient
(e.g., Google and Intel).
2.4. Hypotheses
Research shows that the ingredient brand can inﬂuence consum-
er evaluations of the host brand either negatively or positively
(e.g., Balachander & Ghose, 2003; Votola & Unnava, 2006). Based
on prior studies in other areas of branding, it is likely that consumers’
perceived ﬁt of brands in the partnership will also inﬂuence attitudes
toward the host brand. In support of this argument, Lafferty et al.
(2004) contend that brand name and product category ﬁts between
partners play an important role in consumer’s perception of the part-
nership. Also supportive is research by Swaminathan et al. (2012)
who found spillover effects of co-branded product trial on purchase
intention of both the host and ingredient brands when there is
high degree of ﬁt between the brands. In sum, both brand image ﬁt
and product category ﬁt are likely to inﬂuence consumers’ reactions to
the ingredient brand partnership, which, in turn, inﬂuences purchase
intentions of the new product offered by the partnership.
Fit is particularly important for brands where a match may be
questionable, such is the case with the luxury branded watchmaker
TAG Heuer who is now partnering with technology-oriented brands

of Google and Intel. The current research proposes that brand ﬁt (i.e., be-tween the brand images of TAG Heuer, Google and Intel) will positivelyinﬂuence consumers’ reactions to new products offered by the hostbrand. This expectation is consistent with the fact that TAG Heuer is aleading luxury brand watchmaker, while Google and Intel possess simi-larly strong brand images within the technology arena. Thus, at a generallevel, brand image ﬁt among TAG Heuer, Google and Intel (all leaderswithin their respective sectors) will have a positive impact on purchaseintentions of a new product offered by the partnership. In addition, prod-uct ﬁt between the host’s current product category and the new productwith an ingredient brand will positively inﬂuence brand attitudes due tocategory ﬁt between the two products. As demonstrated by Park et al.(1991), luxury brands are more extendible if the brand concept is consis-tently transferred, even if product-feature similarity is low. The precedingdiscussion supports the following hypotheses.

H1. Perceived brand image ﬁt between a luxury host brand and anon-luxury ingredient brand inﬂuences purchase intentions of thehost brand’s new product positively.

H2. Perceived product category ﬁt between a luxury host brand’s tradi-tional product category and the new product offered by the strategicbrand partnership inﬂuences purchase intentions of the host brand’snew product positively.

Consumers consider luxury as an important factor among brands ina product category, thus, the concept of luxury should be a central driverof consumer preference and usage of such luxury products (Kapferer,1997). It is difﬁcult to develop a luxury brand image without developinga long-term commitment to high quality (Vigneron & Johnson, 2004),therefore it is reasonable for consumers to expect such brands to offersuperior product quality and performance compared to non-luxurybrands (Christodoulides, Michaelidou, & Li, 2009). Additionally, higherprices for luxury products may reinforce the image of luxury brandsbecause consumers perceive higher prices as an indication of greaterquality (Vigneron & Johnson, 2004).

Consumers’ perceptions of whether a particular brand is a luxury ornot are likely to vary. For example, TAG Heuer may be perceived as aluxury brand by some segments of the market, but not others. Differ-ence in such perceptions may occur for a variety of reasons, includingbut not limited to individual and cultural differences among seg-ments of consumers. These variations are potentially important inthe marketplace; as Lynn (1991) argues, perception of brand luxurycan enhance consumers’ brand preferences which in turn stimulatesgreater purchase intentions. In particular, the current research pro-poses that variation in perceptions of a brand’s luxuriousness willimpact how consumers respond to products offered by a luxuryhost brand alongside non-luxury ingredient brand partners. Giventhe symbolic nature of luxury goods and the importance of imagesignaling (Vickers & Renand, 2003), consumers will likely placegreater importance on a luxury brand’s image when considering anew product offered by a brand partnership, especially for thosewho perceive the brand as a luxury.

H3a. Consumer perceptions of whether a brand is a luxury or not mod-erate the effect of perceived brand image ﬁt on purchase intentions of anew product offered by brand partnership such that higher perceptionof brand luxury strengthens the positive inﬂuence on the consumer’spurchase intention.

H3b. Consumer perceptions of whether a brand is a luxury or not moder-ate the effect of perceived product category ﬁt on purchase intentions ofa new product offered by brand partnership such that higher perceptionof brand luxury strengthens the positive inﬂuence on the consumer’spurchase intention.

H. Moon, D.E. Sprott / Journal of Business Research 69 (2016) 5768–5774

1. Method
3.1. Pretest
A pretest assessed the psychometric quality of measures for each con-
struct (drawn from prior research) used in the main study via an online
survey. The pretest used a sample of Amazon MTurk workers (N = 74),
who were paid $1.00 as an incentive. While some have noted concerns
about the use of MTurk (Rouse, 2015), other research suggests that
studies based on MTurk samples are similar to those obtained using
more representative sampling techniques (Simons & Chabris, 2012).
In contrast to prior studies that often use a ﬁctitious brand, the cur-
rent research examines a real-world brand partnership. In particular,
participants were presented with a scenario and an advertisement to
describe the partnership between a luxury watch brand (i.e., the host
brand of TAG Heuer) and microprocessor brands (i.e., the ingredient
brands of Google and Intel), that will launch a new product (i.e., TAG
smartwatch). In particular, stimuli for the study (including new product
features of the smartwatch) are based on information offered by TAG
Heuer’s ofﬁcial website. After viewing the scenario and advertisement,
pretest participants rated their perceptions of the brand partnership.
Based on the pretest, some items were modiﬁed to improve validity
and reliability of certain scales for the main study.
3.2. Sample and data collection
For the main study, the sample included 199 consumers recruited
from MTurk (94 females, average age = 32.77) who evaluated the ingre-
dient brand partnership among TAG Heuer, Google, and Intel. Data were
collected via an online survey similar to that described in the pretest.
Although the study uses exactly the same procedures to gather data
in the main study, the sample was composed of different research
participants.
3.3. Measures
Consumers’ perceived brand image ﬁt between the host and the ingre-
dient brands is measured similar to earlier research (e.g., Aaker & Keller,
1990). In particular, participants indicated their agreement with the
following two statements on 7-point Likert-type items (anchored with
“strongly disagree” and “strongly agree”): “The brand images of TAG
Heuer, Google and Intel are complementary,” and “The brand images of
TAG Heuer, Google and Intel are consistent,” (α = 0.85). The average
score of these items represent brand image ﬁt. Product category ﬁt
between TAG Heuer’s traditional products and the new smartwatch is
measured with three statement on 7-point Likert-type items (anchored
with “strongly disagree” and “strongly agree”) adapted from previous
research (e.g., Fedorikhin, Park, & Thomson, 2008). The three items
are: “The smartwatch ﬁts very well with the product category of TAG
Heuer,” “The products of TAG Heuer and the smartwatch belong
together,” and “There is a similarity between the product category of
smartwatch and the products of TAG Heuer,” (α = 0.93). The average
score of these items assesses product category ﬁt.
Brand luxury perceptions are measured by asking participants to
indicate how they consider TAG Heuer as a luxury brand with following
7-point Likert-type item (1 = strongly disagree, 7 = strongly agree): “I
would consider TAG Heuer to be a luxury brand.” Purchase intentions
served as the key dependent variable and were measured with three
statements on 7-point Likert-type items adapted from Rodrigue and
Biswas (2004): “The new smartwatch is very appealing to me,” “I
would buy this smartwatch,” and “I would like to try to use this
smartwatch,” (α = 0.90; anchored with “strongly disagree” and
“strongly agree”). The average score of the three items represents
purchase intention.
The study includes a variety of control variables (including product
category involvement and brand familiarity), since these variables are

likely to inﬂuence purchase intentions for the new product. As involve-ment with a product category may lead to greater interest in new productofferings (e.g., Albrecht et al., 2013), involvement was measured with 5items adapted from previous research (e.g., Goldsmith & Emmert,1991): “I would be interested in reading information about how watchproduct is made,” “I would be interested in reading the Consumer Reportsarticle about watch category,” “I have compared product characteristicsamong brands of watch products,” “I think there are a great deal of differ-ences among brands of watch product,” and “I have a most preferredbrand of watch product,” (α = 0.79; anchored with “strongly disagree”and “strongly agree”). Brand familiarity was also measured by askingrespondents to indicate how well they know TAG Heuer with the follow-ing Likert-type item (1 = strongly disagree, 7 = strongly agree): “I amfamiliar with the TAG Heuer before this study.”

Based on research of Zhou, Yim, and Tse (2005), a two-step procedurewas used to analyze construct validity. After running an exploratory factoranalyses for each construct, conﬁrmatory factor analyses were conductedfor the entire set of constructs. The conﬁrmatory factor analyses revealthat the best model includes three correlated factors. Because perceptionof brand luxury was assessed with a single item, it was not included in themeasurement model to test for convergent and discriminant validity(Kline, 2015). The three-factor model ﬁt the data well (χ2 (17) = 43.2,p b 0.001; CFI = 0.98; GFI = 0.95; RMSEA = 0.08), and all factor loadingswere substantial and signiﬁcant (p b 0.001). Convergent and discriminantvalidity were assessed using a method developed by Fornell and Larcker(1981). Supporting convergent validity, the AVE for each latent constructis greater than the suggested value of 0.50 (Fornell & Larcker, 1981).Results also provided support for discriminant validity. First, the cor-relation between the constructs is below 0.85 (Table 1), ruling outmulticollinearity (Bagozzi & Yi, 1988). Second, the AVE for each latentconstruct surpasses the squared correlation between the two constructs(Fornell & Larcker, 1981).

Results

Table 1 provides descriptive statistics along with correlations for thefocal measures. Hierarchical regression analyses test focal hypotheses;Table 2 provides regression results for the main and moderation effects.Data were mean centered before conducting moderator analysis to helpminimize multicollinearity. Variance inﬂation factors indicate that nomulticollinearity is present in the current study (average VIF: 1.83).Purchase intentions of the host brand’s new product were regressedon brand image and product category ﬁt (H1 and H2); two control vari-ables (i.e., product category involvement and brand familiarity) are alsoincluded in the model (both of which are positively associated with thedependent variable). For the moderation tests (H3a and H3b), interactionterms were included in an additional regression model. In Table 2, the ﬁrstcolumn shows main effects of brand and product ﬁt on purchase inten-tions of the host brand’s new product; the second column reports theinteractive effects of brand luxury perceptions on the relationshipbetween brand image (and product category) ﬁt on purchase intentions.H1 proposes a positive effect of the brand image ﬁt between thepartners on purchase intentions for the host brand’s new product.According to the regression results and in support of H1, brand imageﬁt has a signiﬁcant positive impact on purchase intentions (p b 0.01).Also, product category ﬁt (i.e., the ﬁt between the host brand’s productcategory and the new product) is proposed to positively inﬂuence pur-chase intentions of the new product in hypothesis 2. As Table 2 shows,the results indicate that product ﬁt had a positive impact on purchaseintentions of the host brand’s new product (p b 0.01); this ﬁnding sup-ports H2. In summary, the study provides strong evidence for the positivemain effects of brand and product ﬁt on the purchase intentions.Regression analysis estimated interactions between brand image(and product category) ﬁt and brand luxury perceptions on purchase in-tentions. H3a and H3b predict that brand luxury perceptions positivelymoderate the effects of brand and product ﬁt on purchase intentions.H. Moon, D.E. Sprott / Journal of Business Research 69 (2016) 5768–5774

Table 1
Descriptive statistics and correlation matrix.
1. Product ﬁt
1. Brand ﬁt
1. Purchase intention
1. Perception of brand luxury
1. TAG brand familiarity
1. Product category involvement
⁎⁎⁎ p b 0.01.

Mean

5.1

5.0

4.6

5.4

4.0

3.8

1.2

1.3

1.6

1.3

2.1

1.3

1.00

0.64⁎⁎⁎

0.44⁎⁎⁎

0.38⁎⁎⁎

0.19⁎⁎⁎

0.09

1.00

0.51⁎⁎⁎

0.19⁎⁎⁎

0.01

0.23⁎⁎⁎

1.00

0.27⁎⁎⁎

0.25⁎⁎⁎

0.46⁎⁎⁎

1.00

0.50⁎⁎⁎

0.22⁎⁎⁎

1.00

0.28⁎⁎⁎

1.00- The results support hypothesis H3a, showing a positive moderating effect

of brand luxury perceptions on the relationship between brand image ﬁt
and purchase intentions (p b 0.05; panel A in Fig. 1). A negative effect
exists regarding brand luxury perceptions moderation of the relationship
between product category ﬁt and purchase intentions (p b 0.05; panel B
in Fig. 1); the ﬁnding does not support H3b.
1. Conclusion and implications
The current research examines consumers’ responses to an ingredient
brand strategy for a luxury brand who has decided to partner with non-
luxury ingredient brands. In particular, the current study explores the
role of ﬁt between the host brand (in this case, TAG Heuer) and its
branded ingredients (namely, Google and Intel) on consumers’ reac-
tions to a new product offered by the host brand (i.e., TAG smartwatch).
Results of the study show that both brand image and product category
ﬁt positively inﬂuence purchase intentions of the host brand’s new
product, but that these effects were moderated by consumers’ luxury
perceptions of the host brand.
Clearly, the brands of TAG Heuer (a luxury watch manufacturer),
Google, and Intel (technology-oriented brands) are dissimilar based
on a number of dimensions. The results of the current research, however,
show that a partnership between such disparate brands can be successful
(in terms of increased purchase intentions for a host brand’s new
product) when consumers perceive good ﬁt among the brand partners.
These ﬁndings suggest that managers of luxury brands who adopt such
an ingredient strategy should consider (and perhaps document with
research) how the brand image of an ingredient partner aligns with
their own brand’s image. Product category ﬁt has a positive effect on
purchase intentions for the host brand’s product, such that greater
perceived ﬁt between the host’s traditional product category and the
new product (offered with ingredient brands) leads to increased purchase
intentions for the new product. Thus, it is also important for luxury brands
to consider how a new product offered by a brand partnership ﬁts the
ﬁrm’s original product offerings. While the current research identiﬁes
Table 2
Regression results.
IVs
Product category involvement
TAG brand familiarity
Brand ﬁt
Product ﬁt
Perception of brand luxury
Brand ﬁt ∗ brand luxury
Product ﬁt ∗ brand luxury
R2
F
⁎ p b 0.10.
⁎⁎ p b 0.05.
⁎⁎⁎ p b 0.01.

Purchase Intention

Estimate

0.40⁎⁎⁎

0.08⁎

0.39⁎⁎⁎

0.24⁎⁎⁎

0.41

34.20⁎⁎⁎

5.58

1.86

4.10

2.50

5.43

1.70

3.92

2.53

0.20

2.01

−1.99

Estimate

0.39⁎⁎⁎

0.08⁎

0.37⁎⁎⁎

0.25⁎⁎⁎

0.02

0.13⁎⁎

−0.12⁎⁎

0.43

20.46⁎⁎⁎

possible upsides for luxury brands to partner with non-luxury ingredi-ents, prior research clearly suggests that poorly ﬁtting brand partnerscan have negative outcomes. For example, research demonstrates thatlower (vs. higher) ﬁt between a parent brand and its extension negativelyinﬂuences consumers’ attitudes toward the extension (e.g., Sattler et al.,2010; Sjödin, 2008). Thus, it is possible that under certain circumstancespoor ﬁt between a luxury host and non-luxury ingredients may harmthe luxury brand’s images and long term market success. While additionalresearch is required to understand when this may be the case, it isprudent for luxury producers to consider ﬁt when pursuing ingredientpartnerships in terms of brand image ﬁt and/or ﬁt with the new productproduced by the partnership.

Importantly, the current study found that the effects of brand imageand product category ﬁt on purchase intentions were moderated by thedegree of consumers’ perception of brand luxury. As predicted, brandFig. 1. Moderating effects of brand luxury perceptions. Panel A. Brand ﬁt with perceptionof brand luxury on purchase intention. Panel B. Product ﬁt with perception of brand luxuryon purchase intention.

H. Moon, D.E. Sprott / Journal of Business Research 69 (2016) 5768–5774

image ﬁt is of greater importance for those who consider the brand to be
a luxury, compared to those who do not perceive the brand as such.
Although the hypothesis regarding the moderating effects of product
category ﬁt (H3b) is not supported, the signiﬁcant negative modera-
tion effect of brand luxury perceptions regarding product category ﬁt
is interesting. This ﬁnding indicates that product category information is
less important for those who perceive the brand to be a luxury. These con-
sumers may be more readily able to integrate information regarding how
a partnership with Google and Intel makes sense for TAG Heuer. These
ﬁndings regarding consumers’ perceptions of brand luxury deserve addi-
tional research attention, given that such luxury perceptions are likely in-
ﬂuenced by a number of factors.
Supply and demand patterns for luxury brands have dynamically
changed in recent years due to increased global competition and coun-
terfeit luxury goods (Randhawa et al., 2015). Thus, luxury brands may
need to adopt more ﬁne-grained branding strategies in order to survive
in this dynamic marketplace. One such approach is ingredient branding
whereby a host brand works with branded ingredients to enhance host
brand products. For example, if the host brand does not have sufﬁcient
technological expertise to produce a new product, the host can draw
from the strengths of the ingredient brand to augment expertise
required to manufacture the new product. The current research tackles
this issue and suggests the importance of ﬁt between the brand partners.
As noted earlier, too few luxury brand partners are likely to exist to form
high ﬁtting brand partnerships, thus, luxury brands may need to ﬁnd non-
luxury brand partners (such as the smartwatch partnerships between
Apple and Hermes and TAG Heuer, Google and Intel). In such situations,
the luxury brand should consider ﬁt with the ingredient brands so that
the brand image of the parent is not harmed.
This research contributes to the literature in the following ways. No
known research to date has examined the impact of ﬁt between a host
and ingredient brand within a luxury brand partnership. Thus, the
current research contributes to extant ingredient branding research.
Furthermore, no research has examined these various issues within a
real market-based case (i.e., the new smartwatch by TAG Heuer, Google,
and Intel). Given this research gap, an important contribution of this
study is understanding the importance of ﬁt between the host and the
ingredients in luxury brand partnership on purchase intentions of a
new product offered by the strategic partnerships.
Despite efforts to create a market-based test regarding the effects of
brand image and product category ﬁt on responses to a host brand’s
new product, this study has some limitations. These limitations, as
well as suggestions for future research, are outlined next. First, while
the study shows moderating effects of consumers’ brand luxury percep-
tions, the appreciation of luxury brands is likely to vary across individuals
and social contexts. For example, the perception of luxury is socially con-
structed and thus responses to products as the one studied in the current
research may differ in a different culture. Thus, future research should
consider different socio-demographic characteristics and individual dif-
ference variables (e.g., materialism or consumers innovativeness) that
may affect the relationship between brand image and product category
ﬁt and the host brand’s purchase intentions. Second, the current research
uses only two variables to control for alternate explanations. Future
research could usefully consider additional control variables that may
inﬂuence responses to a new product offered via luxury ingredient brand-
ing partnerships. For example, given the critical role of price in luxury
branding, future research could usefully consider the inﬂuence of price
level (e.g., the new product’s introductory price or price range) on percep-
tions of and purchase intentions toward the new product. Third, the new
TAG Heuer smartwatch was not on the market when the study was
conducted. For future research, consider re-conducting the existing
study after the product’s launch to compare those results with the current
study. Fourth, the study examines the real-world partnership of TAG
Heuer, Google, and Intel within the context of a smartwatch. While
there is no reason to expect product category effects, it may be that
consumers have different decision-making processes within different

product categories. Also, their perception to consider a speciﬁc brand asa luxury brand may differ. Thus, future research should examine or usedifferent product categories as means to test the generalizability of thecurrent ﬁndings. Despite the aforementioned limitations, the currentresearch makes a contribution to the luxury brand research literature bybeing the ﬁrst to examine how and under what conditions ﬁt affectspurchase intentions of the luxury host brand’s new product offered byan ingredient branding partnership.

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