The "Dark Side" of Brand Alliances: How the Exit of Alliance Members Affects Consumer Perceptions

The main objective of this study is to increase understanding of the effectiveness of brands in a dynamic environment such as airline alliances. Therefore, the effects on consumer perceptions that occur when an alliance member quits an alliance, in comparison with the impact of a new brand joining an alliance are examined. The study tested its hypotheses in an online study using a Web survey design. Results indicate a significant positive (negative) main effect of an announcement of a strong brand's network entry (exit). This finding is important for airline brand management. Since some conflicts among network partners or strategy shifts are likely to occur over time, the airline should be aware that the decision to withdraw from an alliance has negative effects on the consumers' perceptions of the airline brand.