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Brand Extension

1. Brand extensions involve introducing a new product targeting new segments or categories under an established brand name to capitalize on consumer familiarity with the parent brand and facilitate acceptance of the new product. 2. There are two main types of brand extensions - line extensions which introduce a product within an existing category, and category extensions which enter a new product category. 3. While brand extensions can increase brand awareness and reduce consumer risk perception, there is a risk the new product could damage the image of the core brand if it disappoints customers or does not fit the current brand portfolio. Extensions are more likely to succeed if the new product has advantages over competitive brands in the new category.

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Avadh Shah
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33 views5 pages

Brand Extension

1. Brand extensions involve introducing a new product targeting new segments or categories under an established brand name to capitalize on consumer familiarity with the parent brand and facilitate acceptance of the new product. 2. There are two main types of brand extensions - line extensions which introduce a product within an existing category, and category extensions which enter a new product category. 3. While brand extensions can increase brand awareness and reduce consumer risk perception, there is a risk the new product could damage the image of the core brand if it disappoints customers or does not fit the current brand portfolio. Extensions are more likely to succeed if the new product has advantages over competitive brands in the new category.

Uploaded by

Avadh Shah
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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BRAN IXTINSION

Sobmitted by:
Avudh Shuh
o6o[q,









Introdoction

Brund exLensIons ure used Lo descrIbe LIe InLroducLIon oI u new producL LurgeLIng
new segmenLs or new cuLegorIes by un esLubIIsIed brund. Brunds seek Lo cupILuIIze
on LIe consumers` prIor knowIedge ubouL LIe brund In order Lo IucIIILuLe LIe
consumers` uccepLunce oI LIe new producL und Lo enIunce LIe purenL brund`s Imuge
or Lo cIunge or consoIIduLe ILs murkeL posILIon.
TIe purenL brund Ius Lo be uwure LIuL, wIen LIey gIve LIeIr IubeI und nume Lo u new
producL, consumers uLLucI, Lo some exLenL, LIeIr experIences und beIIeIs oI LIe new
producL Lo LIe brund. AccordIngIy, LIe InLroducLIon oI u new producL couId dImInIsI
brund equILy II IL someIow oIIends or dIsuppoInLs LIe orIgInuI cusLomer buse. AIso, IL
couId jeopurdIze LIe brund meunIng us IL wouId noL IIL LIe currenL producL porLIoIIo.
TIIs couId LIen Ieud Lo u decreuse In brund uwureness und u dIIuLIon oI LIe desIred
brund meunIng und Imuge.

ExumpIes ure:
!onds - CoId creum, ToIIeL soup SIumpoo, TooLI pusLe, MoIsLurIzIng IoLIon,
TuIc & uce wusI.
- TeIevIsIon, ReIrIgeruLors, CompuLer monILors, MIcrowuves, AIr
CondILIoners, WusIIng MucIInes & MobIIe pIones.















Types oI Brund Ixtension:
eneruIIy, Lwo dIIIerenL Lypes oI brund exLensIons cun be observed: Ine exLensIons
und cuLegory exLensIons. Ine exLensIons descrIbe LIe purenL brunds uLLempL Lo
InLroduce u producL wILIIn un uIreudy exIsLIng cuLegory. CuLegory exLensIons, In Lurn,
descrIbe LIe InLroducLIon oI u new producL cuLegory, dIIIerenL Irom LIe currenL
producL porLIoIIo.

1. Ine ExLensIons
!urenL brund Is used Lo brund u new producL LIuL LurgeLs u new murkeL segmenL
wILIIn u producL cuLegory currenLIy served by LIe purenL brund
ExumpIe: H&S dry scuIp sIumpoo
nvoIves mukIng enLrIes In brund`s exILIng producL cuLegory by usIng LIe sume brund
nume. TIese enLrIes cun come In LIe Iorm oI vuryIng producL sIzes, IIuvours, coIours,
und IngredIenLs und Iorms
z. CuLegory ExLensIons
!urenL brund Is used Lo enLer u dIIIerenL producL cuLegory Irom LIuL currenLIy served
by LIe purenL brund
ExumpIe: SwIss urmy wuLcIes, !orscIe bIcycIes

!roducL exLensIons ure versIons oI LIe sume purenL producL LIuL serve u segmenL oI
LIe LurgeL murkeL und Increuse LIe vurIeLy oI un oIIerIng. An exumpIe oI u producL
exLensIon Is Coke vs. DIeL Coke In sume producL cuLegory oI soIL drInks. TIIs LucLIc Is
underLuken due Lo LIe brund IoyuILy und brund uwureness LIey enjoy consumers ure
more IIkeIy Lo buy u new producL LIuL Ius u LrIed und LrusLed brund nume on IL. TIIs
meuns LIe murkeL Is cuLered Ior us LIey ure receIvIng u producL Irom u brund LIey
LrusL und Cocu CoIu Is cuLered Ior us LIey cun Increuse LIeIr producL porLIoIIo und
LIey Iuve u Iurger IoId over LIe murkeL In wIIcI LIey ure perIormIng In.









Instunces where brund extension hus been u soccess ure-
I. ipro wIIcI wus orIgInuIIy InLo compuLers Ius exLended InLo sIumpoo,
powder, und soup.
II. urs Is no Ionger u Iumous bur onIy, buL un Ice-creum, cIocoIuLe drInk und u
sIub oI cIocoIuLe.

Instunces where brund extension hus been u Iuilore ure-
I. n cuse oI new oke, Cocu CoIu Ius IorgoLLen wIuL LIe core brund wus meunL
Lo sLund Ior. L LIougIL LIuL LusLe wus LIe onIy IucLor LIuL consumer cured
ubouL. L wus wrong. TIe LIme und money spenL on reseurcI on new Cocu CoIu
couId noL evuIuuLe LIe deep emoLIonuI uLLucImenL Lo LIe orIgInuI Cocu- CoIu.
II. Rusnu Ld. - s umong LIe Iumous soIL drInk compunIes In ndIu. BuL wIen IL
LrIed Lo move uwuy Irom ILs nIcIe, IL Iusn`L Iud mucI success. WIen IL
experImenLed wILI IIzzy IruIL drInk Orunjolt, LIe brund bombed even
beIore IL couId Luke oII. OrunjoIL wus u IruIL drInk In wIIcI curbonuLes were
used us preservuLIve. L dIdn`L work ouL becuuse IL wus ouL oI syncIronIzuLIon
wILI reLuII prucLIces. OrunjoIL need Lo be reIrIgeruLed und IL uIso Iuced quuIILy
probIems. L Ius u sIeII IIIe oI LIree-Iour weeks, wIIIe oLIer soIL- drInks
ussured IIIe oI IIve monLIs.

AdvunLuges oI Brund ExLensIon
Brund ExLensIon Ius IoIIowIng udvunLuges:
O L mukes uccepLunce oI new producL eusy.
1. L Increuses brund Imuge.
z. TIe rIsk perceIved by LIe cusLomers reduces.
. TIe IIkeIIIood oI guInIng dIsLrIbuLIon und LrIuI Increuses. An esLubIIsIed
brund nume Increuses consumer InLeresL und wIIIIngness Lo Lry new producL
IuvIng LIe esLubIIsIed brund nume.
q. TIe eIIIcIency oI promoLIonuI expendILure Increuses. AdverLIsIng, seIIIng und
promoLIonuI cosLs ure reduced. TIere ure economIes oI scuIe us udverLIsIng Ior
core brund und ILs exLensIon reInIorces eucI oLIer.
. CosL oI deveIopIng new brund Is suved.
6. Consumers cun now seek Ior u vurIeLy.
;. TIere ure puckugIng und IubeIIng eIIIcIencIes.
8. TIe expense oI InLroducLory und IoIIow up murkeLIng progrums Is reduced.
O TIere ure Ieedbuck beneIILs Lo LIe purenL brund und LIe orgunIzuLIon.
1. TIe Imuge oI purenL brund Is enIunced.
z. L revIves LIe brund.



. L uIIows subsequenL exLensIon.
q. Brund meunIng Is cIurIIIed.
. L Increuses murkeL coveruge us IL brIngs new cusLomers InLo brund IruncIIse.
6. CusLomers ussocIuLe orIgInuIJcore brund Lo new producL, Ience LIey uIso Iuve
quuIILy ussocIuLIons.


DIsudvunLuges oI Brund ExLensIon
O Brund exLensIon In unreIuLed murkeLs muy Ieud Lo Ioss oI reIIubIIILy II u brund
nume Is exLended Loo Iur. An orgunIzuLIon musL reseurcI LIe producL
cuLegorIes In wIIcI LIe esLubIIsIed brund nume wIII work.
O TIere Is u rIsk LIuL LIe new producL muy generuLe ImpIIcuLIons LIuL dumuge
LIe Imuge oI LIe coreJorIgInuI brund.
O TIere ure cIunces oI Iess uwureness und LrIuI becuuse LIe munugemenL muy
noL provIde enougI InvesLmenL Ior LIe InLroducLIon oI new producL ussumIng
LIuL LIe spIn-oII eIIecLs Irom LIe orIgInuI brund nume wIII compensuLe.
O I LIe brund exLensIons Iuve no udvunLuge over compeLILIve brunds In LIe new
cuLegory, LIen IL wIII IuII.

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