DOI: 10.36347/sjebm.2018.v05i01.006

Pages: 41-56

Brand extension is a marketing tool that involves using of a well-established or known brand name to introduce a new set of product either in a line or category extension. The fact that hotels are increasing and expanding makes competition more intensely among them. These allow hotels to examine ways of differentiating themselves from their competitors and in the same way allow them to have a competitive advantage in the market. The research problem is to analyze if the brand extension strategy adopted in selected hotel chains in Northern Cyprus affects the buying patterns of customers and if it also influences brand loyalty and brand equity on customer hotel brand identification. The sample of the study involves those tourist visiting Northern Cyprus hotels. Non-probability convenience sampling technique is used to collect data that was used as a survey instrument. The data was analyzed using SPSS version 20 based on the questionnaires. The use of tables, percentages, frequencies, bar charts and mean were used to sum up the demographics of respondents. To test the relationship between the hypotheses, the measurement technique that was used is Pearson Correlation and ANOVA. The research findings indicate the brand extension practiced by selected hotels in North Cyprus affects the buying decisions of customers. Customers having a positive attitude towards the parent brand of a hotel transfer this attitude to the extension, through previous knowledge and service quality which influences their purchase decision. The perceived fit and similarity between the hotel brand and its extension helps customers to view the brands as the same concerning the service quality and also increasing the value of the major hotel brand. This motivates customers to patronize the hotel brand. Customer brand loyalty leads to hotel brand equity at the long run........