An empirical investigation of mobile services cross-category promotions

Transcription

1 580 Int. J. Mobile Communications, Vol. 11, No. 6, 2013 An empirical investigation of mobile services cross-category promotions Shuiqing Yang School of Information, Zhejiang University of Finance and Economics, Hangzhou , China Yaobin Lu* School of Management, Huazhong University of Science and Technology, Wuhan , China *Corresponding author Sumeet Gupta Dept. of Operations and Systems, Indian Institute of Management Raipur, Raipur , India Abstract: A number of mobile services providers are promoting their new product by leveraging upon customers recognition of their existing product. However, the effectiveness of such leveraging is yet to be studied systematically, especially in an emerging mobile services context. The current study examines the factors that determine the effectiveness of cross-category promotions of mobile services. On the basis of the theory of brand extension, an adoption model which reflects customers attitude shift from parent mobile product to the promoted new mobile product was developed and empirically tested against data collected from 545 China Mobile s mobile instant messenger users. Structural equation analysis results indicate that consumers attitude towards parent mobile product influences their attitude towards the promoted new mobile product both directly as well as indirectly through perceived fit. Consumer trust also plays an important role in the process of customers evaluation of cross-category promotions of new mobile services. Keywords: mobile communications; mobile services; brand extension; sales promotions; cross-category; perceived fit; trust. Reference to this paper should be made as follows: Yang, S.Q., Lu, Y.B. and Gupta, S. (2013) An empirical investigation of mobile services cross-category promotions, Int. J. Mobile Communications, Vol. 11, No. 6, pp Biographical notes: Shuiqing Yang is an Assistant Professor at School of Information, Zhejiang University of Finance and Economics. His research focuses on electronic and mobile business, and technology adoption. Copyright 2013 Inderscience Enterprises Ltd.

2 An empirical investigation of mobile services cross-category promotions 581 His research has been published in Decision Support Systems, Information & management, Computers in Human Behaviour, International Journal of Human Computer Interaction and several other journals. Yaobin Lu is a Professor at School of Management, Huazhong University of Science and Technology. His research interests include technology implementation, individual adoption, customer trust, electronic commerce, and related topics. He has published in Information Systems Journal, Decision Support Systems, Information & Management, Information Systems Management, Electronic Commerce Research and Applications, International Journal of Information Management, Computers and Education and several other journals. Sumeet Gupta is an Associate Professor of Indian Institute of Management, Raipur. His research interests include supply chain, information systems and retailing. He has published in International Journals such as Decision Support Systems, International Journal of Electronic Commerce, European Journal of Operational Research, Omega and others. 1 Introduction Realising the emerging revenues-add potential of Mobile internet marketplaces, a number of mobile services providers are trying to launch new product by leveraging upon customers recognition of their existing product. For instance, after achieved widespread success with its I-mode in 1999, NTT DoCoMo launched mobile payment services in Similarly, Apple launched the App store to sell third-party mobile applications for its iphone and ipod touch in 2008, after its success in itunes store in These cross-category promotions strategies give firms an opportunity to generate additional revenue with minimal expenditure on sales promotions or product advertising associated with the new product introduction. However, the outcomes of these new product cross-category promotions were not consistent. Some report that cross-category promotions of new products do not only offer a new source of revenue, but also reinforce brand image and equity when managed well (e.g., Keller and Sood, 2003), while others say that despite benefiting from parent brand leverage seems tempting, the failure rate of such new products promotions is quite high (e.g., Dens and De Pelsmacker, 2010). This inconsistency can be problematic because it confuses our understanding of the mechanisms of cross-category promotions on customer s evaluation of the promoted new product, and subsequently inhibits us from predicting customer s acceptance. Therefore, it becomes imperative for us to understand the drivers of success cross-category promotions of new product. Despite previous studies provide rich insights in the sales promotions literature (Buil et al., 2011; Valette-Florence et al., 2011), most focus has been on the evaluation of product promotions in the same product category, not considering the impact of parent product on the evaluation of new product promotions in a different product category. Yet a few studies have recently discussed the cross-category effects of sales promotions on customer purchase behaviour (e.g., Henderson and Arora, 2010; Leeflang and Parreño-Selva, 2012; Leeflang et al., 2008), rare of them tests the cross-category promotions of new product in the context of mobile services. As a marketing channel,

3 582 S.Q. Yang et al. mobile services channels are inherently prone to information eavesdropping and are more uncertain than traditional offline and online channels (Lu et al., 2011). Thus, investigating the effects of cross-category promotions on new product introduction in the context of mobile services could significantly add its generalisability. In addition, as the studies reporting the effects of cross-category promotions are mainly based on econometric methods, these studies investigate the impact of cross-category promotions on overall sales, but do not identify the sources of this impact. To understanding the effectiveness of new products cross-category promotions, we need to explore the internal association between the parent product and the new product that determine consumer s evaluations of the new product promotions and subsequently use of the promoted product, especially in an emerging mobile services context. To fill the gap, this study examines the factors that determine the effectiveness of new product cross-category promotions in the context of mobile services by focusing on the attitude shift from parent product to the promoted new product. Drawing on the theory of brand extension and prior research related to sales promotions and consumer trust, this study investigates How does customers attitude towards the parent product influences their attitude towards the promoted new product in the mobile services context? How do perceived fit and consumer trust influences customers evaluation of the promoted new product in the mobile services context? The current study contributes to a better theoretical understanding of the customer evaluations of new mobile services cross-category promotions and offers practical insights to firms for managing such cross-category promotions. The rest of the paper is organised as follows. The literature review is presented in the next section. In Section 3, we put forward the conceptual model and research hypotheses, followed by a discussion on research material and methods in Section 4. Then, the results are presented in Section 5. Finally, this study closes with a discussion of findings and implications, as well as the limitations. 2 Literature review Sales promotions are important marketing tools designed to stimulate greater purchases for a limited period of time (Valette-Florence et al., 2011). In academia, the empirical investigations in the realm of sales promotions can be categorised into two streams: monetary promotions and non-monetary promotions (Buil et al., 2011). Monetary promotions, such as price discounts and coupons, are the most popular type of sales promotions in marketing. Non-monetary promotions, such as free gifts or sweepstakes, are also important type of sales promotions as to achieve different purpose of sales promotions (Yi and Yoo, 2011). Previous studies differentiate between these two types of sales promotions and found different impacts of the two types of promotions on customers attitude and behaviour towards the promoted new product (Buil et al., 2011). Buil et al. (2011) found that monetary promotions have a negative influence on perception and attitude towards the promoted new product, while the non-monetary promotions exert a positive impact on the attitude.

4 An empirical investigation of mobile services cross-category promotions 583 Unlike the consistent finding on the positive impact of non-monetary promotions on a brand attitude, empirical results on whether monetary promotions strengthen or hinder a brand attitude are mixed. Some researchers found that repeated monetary promotions have negative impact on brand attitude (Valette-Florence et al., 2011), while others obtained an opposite result (Davis et al., 1992). In a meta-analysis of sales promotions on customer brand preference, DelVecchio et al. (2006) reported that promotions can either increase or decrease a brand preference regarding the characteristic of the sales promotions and the type of the promoted new product. The current study conceptualises promotions as non-monetary promotions, such as free gifts or sweepstakes. Despite the progress made by the extant studies, most of them consider the effects of promotions only within a single product category (Leeflang et al., 2008). The exploration of cross-category promotions that consider the internal association between the parent product and the promoted new product is still quite limited, especially in an emerging mobile services context. This study therefore investigates the factors that determine the effectiveness of new mobile services cross-category promotions by focusing on the attitude shift from parent product to the promoted new product. 3 Conceptual model and research hypotheses The discussion on cross-category promotions of mobile services is developed based on the theory of brand extension and prior research related to sales promotions and consumer trust (see Figure 1). As shown in Figure 1, the research model depicts that customers attitude towards parent product positively affects their attitude towards promoted new product both directly and indirectly via perceived fit between parent product and new product. Consumer trust positively influences customers attitude and behavioural intention towards promoted new product. Consumer trust also has the moderating effect on the relationship between attitude towards parent product and attitude towards promoted new product. Next, we present the theoretical justifications behind the hypotheses depicted in Figure 1. Figure 1 Research model

5 584 S.Q. Yang et al. 3.1 Perceived fit between parent product and promoted new product Brand extension refers to the leveraging upon the established brand name for entering a new and different product category or market (Aaker and Keller, 1990). The value of a brand to the firm is decided not only by its current market status, but also by its potential untapped markets in the future (Van Riel and Ouwersloot, 2005). Categorisation theory is frequently applied to understand the brand extension process. According to the categorisation theory, people attempt to classify the object within a certain category when they have to evaluate any new product (Dens and De Pelsmacker, 2010). If a new brand/product extension is viewed as belonging to the current category, attitude and beliefs associated with the category are transferred to this new extension. Brand extension theory has enjoyed a rich tradition of empirical research in both psychology and marketing contexts (Aaker and Keller, 1990; Dens and De Pelsmacker, 2010). A number of studies found that customers attitude towards the parent product has a positive influence on their attitude towards the new brand/product extension (Czellar, 2003; Dens and De Pelsmacker, 2010). Previous studies (e.g., Dens and De Pelsmacker, 2010; Franziska and Sattler, 2006) have reported that that perceived fit between the parent product and an extension product is the most important driver of brand extension success. Perceived fit is characterised by some of the shared associations between the extension product and the parent product. When perceived fit is high between the original and the extended brand, the new extension will be more easily matched with the parent category and the underlying mechanism of brand extension could be triggered (Keller, 1993). In other words, perceived fit between the parent product and a new product will positively affect attitude towards the new product. Hence, we hypothesise: Hypothesis 1: Attitude towards parent product will positively affect attitude towards promoted new product. Hypothesis 2: Perceived fit between the parent product and promoted new product will positively affect attitude towards the promoted new product. According to brand extension theory, customers overall brand evaluation is stored in memory and is retrieved when required (Keller, 1993). Customers attitude towards the parent product can affect the perceived fit via the retrieval of memory (Song et al., 2010). If customers attitude towards the parent product is positive, then they may expect the product provider to have more capability to launch a new product. Consequently, the perceived fit will be higher. In other words, attitude towards parent product will positively affect perceived fit between parent product and promoted new product. Hence, we hypothesise: Hypothesis 3: Attitude towards parent product will positively affect perceived fit between the parent product and promoted new product. In information systems literature, attitude has long been shown to affect behavioural intention (Ajzen, 1991). The positive association between attitude and behavioural intention has received substantial empirical support (Kim, 2009; Pavlou and Fygenson, 2006). In the context of this study, it is reasonable to expect that customers attitude towards a promoted new product will positively influence their intention to use the promoted new product. Therefore, we hypothesise that:

6 An empirical investigation of mobile services cross-category promotions 585 Hypothesis 4: Attitude towards promoted new product will positively affect behavioural intention towards promoted new product. 3.2 Consumer trust Trust is defined as a subjective belief that a trusted party will fulfil its obligations in accordance with expectations of the trusting party (Kim et al., 2009). Customer trust is crucial for the success of cross-category promotions of new product because trust reduces fears and worries associated with the usage of the new product. In our research context, mobile channels in which mobile services access and transaction are more vulnerable and uncertain than traditional offline and online channels, and therefore entail greater risk than those traditional channels (Lu et al., 2011). Thus, customer trust is more crucial for the success of cross-category promotions of the new mobile services. Previous studies also report that positive assessments of a specific product may get transferred to the brand and consequently affect a new extension product associated with that brand (Kuan and Bock, 2007; Stewart, 2003). In other words, consumer trust will result in a positive attitude that stimulates favourable behavioural intentions towards the provider and its products (Falk et al., 2007; Lai et al., 2012; Shin and Shin, 2011). Hence, we hypothesise: Hypothesis 5: Consumer trust will have a positive influence on attitude towards the promoted new product. Hypothesis 6: Consumer trust will have a positive influence on behavioural intention towards the promoted new product. Consumer trust will reduce risk and uncertainty associated with new product promoted by the vendor (Falk et al., 2007). Consequently, the influence of a customers attitude towards the parent product on the new product will be stronger if the customer trusts the vendor. In other words, consumer trust will positive moderate the relationship between attitude towards the parent product and attitude towards the promoted new product. Thus, Hypothesis 7: The positive relationship between attitude towards parent product and attitude towards promoted new product will be stronger for individuals with higher consumer trust. 4 Material and methods 4.1 Research setting The current study tested the proposed model and hypotheses by using China Mobile, the largest mobile network operator in China, as its test bed. China Mobile launched its mobile instant messenger service-fetion in Two years later, Fetion became one of the two most popular mobile instant messengers in China. Following its success in the mobile instant messenger market, China Mobile launched its 139 mobile virtual community in The reasons that we consider China Mobile s mobile instant messenger and 139 mobile virtual communities as the targets of our research are as follows. First, mobile instant messenger and mobile virtual community are the two most commonly used mobile applications in China. This ensures the availability of respondents and the practicability of our research. Secondly, mobile instant messenger and mobile

7 586 S.Q. Yang et al. virtual community belong to different categories. Thus, mobile virtual community can be treated as new product categories for the mobile instant messenger. Thirdly, China Mobile launched its mobile virtual community 3 years after the introduction of its mobile instant messenger. This could ensure the temporal order of cross-category promotions of mobile virtual community. Therefore, China Mobile s mobile instant messenger and its mobile virtual community are appropriate targets to investigate the cross-category promotions of mobile services. 4.2 Sample The data for this study were collected from two service halls of China Mobile branches in a city located in central China. The reasons for using this convenience sample are that we can reach a large number of mobile phone users at these places and can obtain a large sample size very quickly. Subjects were randomly intercepted in the service halls and asked whether they had experience using China Mobile s Fetion via wireless internet. Subjects with the experience were requested to fill the questionnaire based on their usage experience. Since China Mobile frequently promotes its extension products (e.g., 139 mobile virtual communities) by using the client application of its mobile instant messenger, participants could fill the questionnaire regarding their opinion on China Mobile s 139 mobile virtual communities. As an incentive for filling the survey, each participant was given a five Ren Min Bi (RMB) worth of gift as a reward. A total of 800 questionnaires were distributed in two weeks. After discarding questionnaires with incomplete or invalid responses, we were left with 545 valid responses. Thus, the effective response rate was 68.1% (see Table 1). Table 1 Sample demographics Item Frequency (N = 545) Percentage Gender Male Female Age < ~ > Education level High school or below Two-year college Four-year college Graduate school or above Occupation Student Corporation Government Education

8 An empirical investigation of mobile services cross-category promotions 587 Table 1 Sample demographics (continued) Item Frequency (N = 545) Percentage Occupation Self-employed Others Average time (per day) spent on China Mobile s mobile instant messenger Half a hour or below >0.5 h and 1 h >1 h and 3 h Over 3 h Measurement To ensure the validity of the instrument, we used existing validated scales in our survey instrument. The questionnaire used seven-point Likert scales, with response choices ranging from one (strongly disagree) to seven (strongly agree). We adapted items of attitude towards parent product from Wixom and Todd (2005). Three items measuring attitude towards promoted new product were adapted from Zhang et al. (2008). The items measuring perceived fit were adapted from Song et al. (2010). We adapted items of consumer trust from Falk et al. (2007) and items of behavioural intention towards promoted new product from Moon and Kim (2001). As the original items are English, a back-translation procedure was conducted to ensure the translation validity. Three professors from information system domain were invited for suggestions on the instrument. On the basis of their feedback, some necessary changes were made to make the survey instrument clearer and understandable. A pilot test was also conducted to validate the instrument. The final items in each scale are listed in Appendix A. 5 Results 5.1 Reliability and validity Following the standard two-step structure equation modelling analysis procedure, the current study first tested the measurement model to examine the reliability and validity. Then we estimated the structural model to test our hypotheses. The factorial validity of the scales was examined using principal components factor analysis and confirmatory factor analysis (CFA). As shown in Table 2, six factors with eigenvalues above one were extracted and they altogether explained % of the variance. All indicators loaded on the expected factors and were all higher than 0.70, while loading on other factors were all lower than 0.50, suggesting good validity of the instruments.

9 588 S.Q. Yang et al. Table 2 Loadings and cross loading Factor UIP TUS ATM FIT ATP UIP UIP UIP TUS TUS TUS ATM ATM ATM FIT FIT FIT ATP ATP ATP Eigen-values Variance % Cumulative ATM = Attitude toward parent product; FIT = Perceived fit; ATP = Attitude toward promoted new product; TUS = Consumer trust; UIP = Behavioural intention toward promoted new product. We also conducted the CFA to assess the factorial validity. As shown in Table 3, the standardised item loading, Cronbach s alpha, and average variance extracted (AVE) of each factor are larger than the recommended criteria which indicate a good reliability and convergent validity of the scale. Table 3 Psychometric features of the measurement model Factor Item Std. loading t-value Cronbach s alpha CR AVE Attitude toward parent ATM product (ATM) ATM ATM Perceived fit (FIT) FIT FIT FIT Attitude toward ATP promoted new product ATP (ATP) ATP

10 An empirical investigation of mobile services cross-category promotions 589 Table 3 Psychometric features of the measurement model (continued) Factor Item Std. loading t-value Cronbach s alpha CR AVE Consumer trust (TUS) TUS TUS TUS Behavioural intention UIP toward promoted new UIP product (UIP) UIP To examine the discriminant validity, the square root of the AVE of each construct and its correlation coefficients with other constructs were compared. Table 4 shows that the square roots of the AVEs were larger than their corresponding correlation coefficients. Thus, the discriminant validity of the constructs is established. Table 4 Factor correlation coefficients and square roots of the AVE* Factor TUS ATM FIT ATP UIP TUS ATM FIT ATP UIP ATM = Attitude toward parent product; FIT = Perceived fit; ATP = Attitude toward promoted new product; TUS = Consumer trust; UIP = Behavioural intention toward promoted new product. *The square root of the AVE is on the diagonal. These values should exceed the inter-construct correlations for adequate discriminant validity. To assess the potential of common method bias in our study, we performed Harman s one-factor test. The results indicate that no single factor accounts for most of the covariance in the variables. In addition, following the procedure used by Podsakoff et al. (2003), we further examine the common method bias by adding a common method factor in the original measurement model. As shown in Table 5, the small magnitude and insignificance of the common method variance demonstrate that the common method bias was not likely to be a serious concern for our study. 5.2 Structural model LISREL 8.72 was adopted to estimate the structural model and test model hypotheses. The actual and recommended values of the model fit indices are listed in Table 6. The actual values of all the model fit indices were better than the recommended values, indicating a good fit between the model and the data (Gefen et al., 2000).

11 590 S.Q. Yang et al. Table 5 Common method bias analysis Construct Indicator Substantive factor loading (R1) R12 Method factor loading (R2) Attitude toward parent ATM *** * product (ATM) ATM *** * ATM *** Perceived fit (FIT) FIT *** * FIT *** FIT *** * Attitude toward ATP *** promoted new product ATP *** ** (ATP) ATP *** ** Consumer trust (TUS) TUS *** TUS *** TUS *** Behavioural intention UIP *** toward promoted new UIP *** product (UIP) UIP *** Average *p < 0.05; **p < 0.01; ***p < Table 6 Fit induces and recommended values (N = 545) Fit index x 2 /df RMSEA GFI AGFI CFI NFI Recommended value <5 <0.08 >0.90 >0.80 >0.90 >0.90 Model value RMSEA = root mean square error of approximation; GFI = goodness of fit index; AGFI = adjusted goodness of fit index; CFI = comparative fit index; NFI = normed fit index. Figure 2 shows the path coefficients and squared multiple correlations (SMC) of the endogenous variables. As shown in Figure 2, all proposed hypotheses were supported. The path from attitude towards parent product to attitude towards promoted new product was found to be significant at P < 0.001, thus supporting Hypothesis 1. As hypothesised, the relationship between perceived fit and attitude towards promoted new product, and the relationship between attitude towards parent product and perceived fit were both significant at P < 0.001, thus supporting Hypothesis 2 and 3. The path from attitude towards promoted new product to behavioural intention towards promoted new product was significant at P < 0.001, thus supporting Hypothesis 4. Two hypothesised paths from consumer trust to attitude towards promoted new product and behavioural intention towards promoted new product were both significant at P < 0.001, thus supporting Hypothesis 5 and 6. The moderating effect of consumer trust on relationship between attitude towards parent product and attitude towards promoted new product was found to R22

12 An empirical investigation of mobile services cross-category promotions 591 be significant, thus supporting Hypothesis 7. The model explained 63.9% of variance of behavioural intention towards promoted new product. Figure 2 Results of the model test **p < 0.01, ***p < Following the procedures suggested by Baron and Kenny (1986), we examined the mediating effects of perceived fit a on the effect of attitude towards parent product and attitude towards promoted new product. As shown in Table 7, the impact of attitude towards parent product on attitude towards promoted new product was partially medicated by perceived fit between the two products. Table 7 The results of mediating effects IV M DV IV DV IV M IV IV + M DV ATM FIT ATP 0.535*** 0.646*** 0.246*** 0.427*** ATM = Attitude toward parent product; FIT = Perceived fit; ATP = Attitude toward promoted new product ***p < M 6 Discussion and conclusion 6.1 Interpretation of results On the basis of the theory of brand extension and prior research to sales promotions and consumer trust, this study empirically examined the factors that affect customers evaluation of cross-category promotions of mobile services. The results of structural equation modelling analysis highlight several interesting findings.

13 592 S.Q. Yang et al. First, the results of the present study reveal that consumers attitude towards parent product positively and directly affect their attitude towards the cross-category promoted new product. In consistent with the finding of Song et al. (2010), this study suggests that it is possible for mobile services providers to enter into additional new marketing by leveraging consumers favourable attitude towards their existing product or brand. Enhancing consumers attitude towards a parent product may not only have a positive effect on their existing product, but also have a positive cross-category impact on the promotions of the firm s newly launched products. Secondly, the results also indicate that perceived fit has an important mediating effect on the relationship between attitude towards parent product and attitude towards promoted new product. This finding is consistent with the results of previous studies which demonstrate that the fitness between the parent product and the extension product is critical in determining the success of brand extension (DelVecchio and Smith, 2005; Newman et al., 2004). Our results extend the applicability of brand extension theory in the mobile services context, and suggest that perceived fit remains a key factor that determines the effectiveness of cross-category promotions of new mobile services. Finally, this study found that consumers trust not only directly affects their attitude and behavioural intention towards the promoted new product, but also indirectly influences the impacts of attitude towards the parent product on attitude towards the promoted new product. This suggests that consumer trust also plays an important role in the process of cross-category promotions of new mobile services. Consumers with high level trust will easily form a positive attitude and intention towards the promoted new product. More importantly, the impact of attitude towards the parent product on attitude towards the promoted new product is stronger for consumers with a high level trust when compared with those who low level trust. 6.2 Theoretical and practical implications From a theoretical perspective, this study contributes by extending the research of sales promotions and product acceptance to a dynamic cross-category promotions environment. The current study explores the mechanism of cross-category promotions of new mobile services by including perceived fit as the key factor that determines the effectiveness of cross-category promotions. Thus, the current study applied the theory of brand extension into a cross-category promotion of new mobile services context, and validated perceived fit as an important factor that affected effectiveness of such promotions. Therefore, this study contributes to a better theoretical understanding of cross-category promotions of new product in an emerging mobile services context. In addition, although the concept of customer trust has been considered important in the process of sales promotions, the fact remains that much of the scholarly effort has been limited to product promotions in the same product category (Hu et al., 2003). The present study investigates the effects of customer trust on the cross-category promotions of mobile services in the multiple products contexts. From a managerial perspective, this research offers some interesting implications that may guide the success of cross-category promotions of mobile services. First, mobile services providers should pay close attention to the fitness between the parent product

14 An empirical investigation of mobile services cross-category promotions 593 and the promoted new product if they wish to promote a new product by leveraging upon consumers recognition of their existing product. The adoption of the promoted new product will be more spontaneous when customers perceive that the fitness between the promoted and the parent product is high. Moreover, building and maintaining consumer trust is critical for helping mobile services providers promotions strategies to become more accepted and successful, especially in the contexts of the multiple products cross-category promotions. Consumer trust cannot only directly influence his or her attitude and behaviour towards the promoted new product, but also indirectly influence the relationship between attitude towards the parent product and attitude towards the promoted new product. Mobile services providers should look for opportunities to foster consumer trust. Building and maintaining consumer trust not only benefits the existing parent product, but also the new extended products. 6.3 Limitations and further research Although our findings offer meaningful implication for cross-category promotions of mobile services, the current study has some limitations. First, the data in this study were collected from customers in a single company in China. While focusing on a particular company can minimise unexplained variance in our model estimation, it also could hinder the generalisability of our results. Future research can therefore further test and validate our findings in the more diversity settings. Secondly, the possibility of ignoring salient factors in explaining customers evaluation of cross-category promotions of mobile services may be a potential problem of this study. For instance, the concept of customer satisfaction and loyalty were not included in our model (e.g., Wu et al., 2010). Although the use of customer trust in current study could act as a proxy of customer satisfaction and loyalty, these constructs may have different impact on customers evaluation of cross-category promotions of mobile services. Future research can examine the influence of customer satisfaction and loyalty on cross-category promotions of mobile services. Finally, to faithfully capture the dynamic process of cross-category promotions of mobile services, an ideal empirical design would be a longitudinal analysis of the extension process. But such temporal analyses are restricted by the cross-sectional nature of survey-based studies. Future research can use a longitudinal design to examine the cross-category promotions of new mobile services. Acknowledgement This work was supported by the grants from the NSFC/RGC ( ), the Specialised Research Fund for the Doctoral Program of Higher Education (No ), and the grant from the Humanity and Social Science Youth foundation of Ministry of Education (13YJC630203). This work was also supported by the Modern Information Management Research Center at HUST.

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17 596 S.Q. Yang et al. Appendix A: Measurement scales Attitude toward parent product (adapted from Wixom and Todd (2005)) ATM1: Using Fetion (China Mobile s mobile Instance Messenger) is very enjoyable. ATM2: My attitude toward using Fetion (China Mobile s mobile Instance Messenger) is very favourable. ATM3: Overall, using Fetion (China Mobile s mobile Instance Messenger) is a pleasant experience. Attitude toward promoted new product (adapted from Zhang et al. (2008)) ATP1: I think the promoted new product (China Mobile s 139 mobile virtual communities) is desirable. ATP2: In general, I am positive about the promoted new product (China Mobile s 139 mobile virtual communities). ATP3: In general, the promoted new product (China Mobile s 139 mobile virtual communities) is good. Perceived fit (adapted from Song et al. (2010)) FIT1: Global similarity between the Fetion (China Mobile s mobile Instance Messenger) and the China Mobile s 139 virtual communities. FIT2: Would the people, facilities, and skills used in making the Fetion (China Mobile s mobile Instance Messenger) be helpful if China Mobile to provide the 139 mobile virtual communities. FIT3: Extent to which Fetion (China Mobile s mobile Instance Messenger) specific associations are relevant in the China Mobile s 139 mobile virtual communities. Consumer trust (adapted from Falk et al. (2007)) TUS1: Based on my experience with China Mobile in the past, I know it is honest. TUS2: Based on my experience with China Mobile in the past, I know it cares about customers. TUS3: Based on my experience with China Mobile in the past, I know it is predictable. Behavioural intention toward promoted new product (adapted from Moon and Kim (2001)) UIP1: I will use the promoted new product (China Mobile s 139 mobile virtual communities) on a regular basis in the future. UIP2: I will frequently use the promoted new product (China Mobile s 139 mobile virtual communities) in the future. UIP3: I will strongly recommend others to use the promoted new product (China Mobile s 139 mobile virtual communities).