Examining the Influence of Social Media Marketing on Consumer Evaluation of Brand Extensions in the FMCG Industry

Abstract

Social media adoption is increasing rapidly and FMCG companies have changed their marketing strategies to consumer engagement through real time, interactive and personalized communication.  Brand extension has, at once, emerged as a very popular growth strategy which allows to utilize existing brand equity for the introduction of new products. Although research on social media marketing and consumer behaviour is extensive, not much research has been undertaken to study how social media marketing helps develop consumer evaluation of brand extensions in the FMCG sector. In order to address this gap, the current study examines how entertainment, interaction, informativeness, customisation and electronic word-of-mouth influence consumer evaluation of brand extensions. In this case, brand trust is examined as a mediator. Based on brand extension theory, social influence theory and relationship marketing theory, the study adopts a quantitative research design and collects data from FMCG (Fast Moving Consumer Goods) consumers using a structured questionnaire. Direct effects link the IV to the DV, and the mediator is important, while indirect effects link the IV and the DV. The findings are likely to show how an effective social media marketing strategy will enhance the trust of consumers in the parent brand, which will lead to stronger positive evaluations and acceptance of brand extensions. This research studying the integration of social media marketing dimensions with brand extensions contributes to comprehensive research in the digital marketing area. Thereby, this newly developed framework will help understand consumer reaction to brand extension strategies. The study also provides managers with implications that can be implemented in the real world. Specifically, managers should focus on social media initiatives that help build trust for a better success rate of brand extensions in highly competitive consumer markets.