Brand extension forms an important part of marketing strategy for many companies. Brand extension reduces the risk of launching a new brand in the marketplace by leveraging on familiarity and consumer acceptance of an established brand. This study empirically examines the significance of ‘perceived fit’ in deciding ‘Consumer Acceptability of Brand Extension’ (CAOBE) in relation to ‘Kist’ brand, through the measurement of ‘product category fit’ and ‘brand level fit’ that cover the fit construct. Data has been collected from a convenience sample of 200 ‘Kist’ brand consumers through a closed-ended questionnaire in Manmunai North Divisional Secretariat Area, Batticaloa, Sri Lanka. The data has been analyzed and evaluated through univariate and bivariate techniques. Regression analysis has been used for testing the hypothesis. The results reveal that the target consumers perceive high level of fit between the parent brand and its extensions, and that the extensions achieve a high level of consumer acceptance. Regression analysis also indicates the successful role of consumer perceived fit in deciding brand extension success.

Over the decades, brand extension has been a part of the core marketing strategy for a large number of companies. Extending brands enables firms to better tap into their substantial brand equity investment (Court et al., 1999). In Sri Lanka too, several Fast- Moving Consumer Goods (FMCG) companies have engaged in brand extensions in the recent past. While new products are introduced through brand extensions, their success is uncertain, as indicated by Aaker and Keller (1990), who point out that not all brand extensions are successful. Any wrong decision and extension into the wrong category could create a negative image that may be costly to neutralize.

For instance, De Chernatony et al. (2003) reported that failure rates of brand extensions in many FMCG categories are approximately 80%. Therefore, identifying the factors affecting brand extension success has captured the attention of researchers so as to reduce the failure rates of brand extensions. In order to determine whether a brand extension will succeed, it is crucial to understand how well the extensions are accepted by consumers.

Brand Management Journal, ‘Consumer Acceptability of Brand Extension’ (CAOBE), The Consumer Perceived Fit, Brand Extension, Fast- Moving Consumer Goods (FMCG), Acceptability.