Incumbent Brand on Purchase Intention of Disruptive Innovations: A Study on the Effects of Brand Image and Sub-Brand Strategy for Electric Motorcycles

Abstract: The purpose of this study is to investigate the relationship between the brand image of an incumbent manufacturer and the purchase intention for a brand extension characterized by a disruptive innovation, and to assess the effects of a sub-brand strategy. This study involves inferential survey research with a conclusive and descriptive nature. Data has been collected through a cross-sectional design with a non-probabilistic sampling, with a sample consisting of 150 respondents among motorcycle enthusiasts, and has been analyzed through Confirmatory Factor Analysis and Regression Analysis. A significant effect over purchase intention for a disruptive innovation was observed in relation to the functional component of the parent brand image and the employment of a sub-brand strategy. Conversely, we did not observe a positive effect of the hedonic component of the parent brand image over purchase intention. In terms of managerial implications, this research suggests that positive functional brand associations can be effectively transferred to a disruptive extension, increasing the purchase intention. Hence, managers should assess the nature of the perceived brand image before launching the extension. Moreover, the development of a sub-brand can further increase the acceptance of the extension and the resulting purchase intention.