Examining Brand Bundling As a New Product Introduction Strategy The Role of Self Congruity and Functional Congruity

Abstract

newline Today s markets have become hypercompetitive in almost every product category. In order to survive, marketers have to constantly devise ways and means of attracting customer attention and create a compelling reason to buy. One of the more popular and cost effective ways that marketers tend to pursue is product /brand bundling. A bundle is a combination of two or more products/brands put together and sold for one price. It is also observed that products are bundled together coinciding with the launch of new brands in the market. Such combinations help both the existing brand and the new brand. The new brand in the bundle draws upon the equity of the stronger existing brand. newlineBrands are bundled together with a view to convey greater perceived utility and functional benefits to the consumers. Prior research has mainly studied the functional benefits provided by product bundles, especially when new brands are tied to an existing popular brand and launched as one unit. However, in the context of brand extensions and co-branding literature, it has been observed that in addition to functional benefits, brands also provide symbolic benefits to the consumers and studying symbolic aspects in a bundling strategy is very essential. As a corollary, studying the role of symbolic as well as functional benefits becomes important in the bundling context too where two brands are tied together and sold as one unit. newlineTaking in to account the increasing importance of bundling and the benefits to consumers, this research attempts to analyze the role of symbolic and functional benefits on consumers bundle purchase intentions when bundling is used as a new product introduction strategy. The study also investigates how the congruence of symbolic and functional cues affects purchase intentions towards the bundle. newlineTo examine the objectives, nine hypotheses were framed.