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ISSN : 1229-8778
This research was conducted to investigate the effect of extension similarity, the price of extension product and perceived risk on extension evaluation and purchase intension. Main interest of this research was to clarify the role of perceived risk. That is, how perceived risk moderate the effect of extension similarity and the price of extension product. Extension similarity(2) X price(2) X perceived risk(2) between subjects factorial design was employed. Results supported research hypotheses. In case of high similarity and high perceived risk condition, high priced extension product was preferred to low priced extension product and purchase intension was significantly high. The results reveal that the price preference caused by perceived risk can be generalized to the situation of brand extension. Research limitations and implications of future research were discussed.
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