New study shows how innovation helps new brands stay ‘on brand’

Over the last several years, Roomba, a brand of robotic vacuum cleaners made by the company iRobot, has grown to control 20% of the vacuum market overall, gaining ground on long-time legacy brands like Hoover, Dyson and Black & Decker.

Its sleek design, small size and programmable features make it appealing for consumers, but it might go beyond that, too. According to a new study from Temple University, it is possible that the perception of Roomba as being an innovative product is what is ultimately drawing consumers in.

The new study from Joydeep Srivastava, the Robert L. Johnson Professor of Marketing at Temple’s Fox School of Business, compares established, legacy brands to new brands. Historically, research has shown that older brands have an advantage over new brands, but there is a caveat. Srivastava’s study finds that for product categories that are perceived as innovative, newer brands can gain ground on legacy brands.

“When you look at past research, the predominant view is that older brands have a major advantage over younger brands. The older brands are more trustworthy and have stood the test of time,” Srivastava said. “But in approaching this study, we were interested in seeing whether there are conditions under which people prefer younger brands? That’s where this project started.”

The new study, titled “The ‘Achilles Heel’ of Established Brands: The Effect of Brand Age on Consumers’ Brand Choice,” was recently published in the the Journal of Marketing Research. The scholarly journal article was co-authored by Temple Ph.D. alum Yaeeun Kim, FOX ’14, an assistant professor in the Department of Marketing and Supply Chain Management at California State University’s College of Business.

As part of their research, Kim and Srivastava reviewed sales data from Amazon and conducted seven experimental studies with nearly 2,000 participants. In conducting the studies, they had participants offer feedback on products from competing brands, one of which is a legacy brand while another is a newer brand.

Across a wide spectrum of categories, everything from home security cameras to anti-aging skincare products, they found that the newer brand brought with it a higher expectation of innovation compared to the legacy brand. This desire for innovation is what ultimately led several participants to prefer the younger brand.

According to Srivastava, the findings are key for legacy brands and how they should market themselves moving forward. As they look to keep their brand fresh, it is important that they continue to depict themselves as innovative.

“Think of a company like Hoover, for instance. This is a tried-and-true brand that has been around since the early 1900s,” Srivastava said. “But what do people think about when they think of Hoover? In comparison, what do they think about when they think of Roomba, which has been around only since 2002? If older brands want to compete, particularly in innovative product categories, it is important that they are being perceived as being innovative, which is one of the biggest takeaways here.”

The key thing for brands, according to Srivastava, is finding the right balance. Older brands have survived because of the strong reputation that they have developed over time, so brands should not do anything that would compromise that. Yet, it is imperative that they show that that they are willing to evolve and innovate at the same time.

“A good example of a brand that does this well is BMW,” Srivastava said. “BMW is an old brand, but they have been consistent with their roots and yet constantly innovate at the same time. They have all the elements of stability as well as excitement at the same time, which is really the place where every brand should hope to be.”