TITLE:
Does Environmental Innovation Produce License: A Customer-Based Brand Equity Perspective?
AUTHORS:
Qiong Yao, Heng Fang
KEYWORDS:
Environmental Innovation, License Effect, Customer-Based Brand Equity, Atypical Marketing Strategy
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.8 No.1,
January
19,
2018
ABSTRACT: Firms
often look for ways to improve the return on investment that they earn from
costly environmental innovation. Drawing from customer-based brand equity
perspective, this article investigates license effect, a previously unexplored benefit
associated with brands’ environmental innovation. License effect refers that
high level of environmental
innovation grants brands the
license to employ atypical marketing strategy without penalty (in the form of
impaired attitudes). We confirm the existence of license effect at product
attribute level and brand level in study 1 and 2. Study 3 further investigated
whether license effect was contingent on important contextual factors. Our results reveal that license
takes effect on price strategy at both product attribute level and brand level.
Moreover, license effect disappears in recycle phase. We conclude that license
comes into effect only when customers construe atypical marketing strategies as
behaviors that associated with personal benefit. By introducing license effect,
we bridge innovation literature and customer-based brand equity theory to
explore firms’ benefit from consumers’ evaluations. Furthermore, our findings
remind managers of a new approach to improve return from environmental
innovation investment.