1 / 10

Brand extensions

Brand extensions. Brand extension. A brand extension occurs when a firm uses an established brand name to introduce a new product. A Line Extension often adds a different flavor or ingredient variety, a different form or size. For example, Lay’s Classic salted and Lay’s Masala Magic

akeem-mooney
Download Presentation

Brand extensions

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Brand extensions

  2. Brand extension • A brand extension occurs when a firm uses an established brand name to introduce a new product. • A Line Extension often adds a different flavor or ingredient variety, a different form or size. For example, Lay’s Classic salted and Lay’s Masala Magic • A Category Extension means applying the parent brand to enter a different product category. For example, Titan Fastrack watches, sunglasses and bags

  3. When a new brand is combined with an existing brand, the extended new brand is called the sub-brand • While the main brand is called the Parent Brand • When the parent brand is already associated with many products, it is called family brand. • For example, in Asian paints Royale, Asian paints is the parent brand and Royale is the sub-brand

  4. Advantages of Extensions • Extensions can potentially provide the following benefits to facilitate new product acceptance: - Improve brand image (Lifebuoy Plus) • Reduce risk perceived by customers & distributors • Increase probability of gaining distribution & trial • Increase efficiency of promotional expenditures (H & S ) • Reduce costs of introductory and follow-up mktg programs • Avoid cost (and risk) of developing new names (HLL) • Allow for packaging and labeling efficiencies (Vicks, Dettol, Maggi) • Permit consumer variety seeking (Lux)

  5. Advantages of Extensions • Besides facilitating new product acceptance, extensions can also provide “feedback” benefits to the parent brand and the company as a whole • Enhance the parent brand image • Improve strength, favorability, and uniqueness of brand associations • Improve perceptions of company credibility • Convey broader brand meaning to consumers (Dettol) • Clarify core benefit proposition and business definition of the company • Bring new customers into the franchise and increase market coverage (Pantene) • Revitalize the brand (Lifebuoy) • Permit subsequent extensions

  6. Extensions have risks, too. Certainly, they can fail. Can confuse or frustrate consumers Can encounter retailer resistance Can succeed but Cannibalize sales of the parent brand Can succeed but diminish identification with one category Can fail and Hurt the image of the parent brand Can dilute brand meaning Forego the chance to develop a new brand name or market the parent brand differently (opportunity cost) Disadvantages of Extensions

  7. Extension Success and Failure Failure: • Rasna Spreadmaker • Dettol hand-wash liquid Success: • Dove shampoo

  8. Designing and Implementing Branding Strategies ‘Branding strategy is an important critical issue because it is the means by which the firm can help consumers understand its products and services and organise them in their minds.

  9. Brand-Product Matrix • Graphical representation of all the brands and products sold by a firm. • Brand line • Brand portfolio • A brand portfolio must be judged on its ability to collectively maximise brand equity.

  10. Products 1 2 3 4 A Brands B C Brand-Product Matrix • Must define . . . • Brand-Product Relationships (ROWS) • Line & Category Extensions • Product-Brand Relationships (COLUMNS) • Brand Portfolio

More Related