THE EFFECT OF CONSUMERS' PERCEIVED SOCIAL MOBILITY ON BRAND UPWARD EXTENSION EVALUATION

Abstract

This research documents how consumer’s perceived social mobility (PSM, consumers’ beliefs about whether the society enables them to move up/down the social ladder) affects their evaluation of a brand’s upward extension. Study 1 documents that consumers who are high in PSM give brand upward extension higher evaluation than consumers who are low in PSM. Study 2 tries to establish causality by manipulating consumers’ perceived social mobility. Study 3 studies whether consumers use their perceived social mobility to evaluate brand upward extension only when brands are perceived as having human characteristics. The framework adds to the social mobility literature by uncovering how such social perception can influence consumer perception of brands. The findings have direct implications for brand managers attempting to extend the brands upward to a more premium line.