In a society that encourages consumption, attributes such as exclusivity and social recognition are important in what is intended to be restricted to a certain exclusive segment. Luxury is something that is more desirable than necessary. This study develops and tests a model that analyses the brand loyalty–risk relationship in the luxury watch market.
To test the proposed research model, a sample of 306 international consumers and enthusiasts of luxury brand watches was collected. The data were analysed using structural equation modelling.
The results show that perceived quality has a negative indirect influence on brand risk and brand trust has a strong direct negative effect on brand risk. However, the findings also show that in the luxury market, the greater the affection for the brand, the greater the risk perceived by consumers.
The study was conducted in a single market, luxury watches and the sample includes both enthusiasts and consumers of the luxury brands.
Managers should be aware of the double-edged role of brand affect on brand risk. The quality of a brand and the trust in its promise decrease the risk to the consumer.
This pioneering study is one of the first to approach an underexplored topic as is the case of the risk associated with a brand in the context of the luxury goods market. Moreover, it relies on an international sample composed of consumers from several countries.
