Thus, in effect weakened the strength of the brand advantage. Other experts however maintain that the concept of brand extension is very critical to a company's growth strategy. This is true, first, because you have a built-in audience who is pre-sold on your brand, but second because the sales channels that you created for the base brand can now be used for the brand extension, which is much more efficient — including cost-efficient — than establishing new channels. Brand Extension Explained A brand extension is where a pre-existing brand creates a new product or creates a sub-brand to sell a new product. In addition, a brand extension is significantly more likely to get media attention than an unknown brand is, including reviews, at no cost to the brand. There are economies of scale as advertising for core brand and its extension reinforces each other. You can help correct errors and omissions.
The strong brand makes it less necessary to create imagery and awareness. By using the same packaging designs, logos and advertising themes that feature on your existing products, you can ensure that customers and prospects recognize the brand values of the new products without having to run major advertising or marketing campaigns. General contact details of provider:. Concept and are ideal to assess whether there is interest in your ideas. On the other hand the company should be careful against diluting the image of the parent brand, adding negative associations, cannibalization, increased consumer expectations and the possibility of increased costs.
A: There are many reasons to add new products-or line extensions-to your company's product mix. This helps to increase customer loyalty and grow revenue per customer. Disadvantages of Brand Extension : 1. They may need different levels of product quality or performance to meet their own operational needs. Ask your sales representatives or contact customers directly to find out if your current product range meets their needs and to identify opportunities to extend your product line. The brand extension of such misconduct, not only the effectiveness, but it will also affect the original strong consumer brands in the eyes of the specific psychological orientation.
© 2006 — 2019 The Blake Project. If you do your homework and proceed with an analytical eye, your line extension will increase sales, help you reach new markets and build market share overall for your growing business. Provision of an energy source for a given brand Should a certain brand image be weak, the use of brand extension may give it anew lifeline. Will crown a strong brand name in other products, if different products in quality, level on the difference between the poor, which makes the strong brand name products and brand extensions have an impact, not only damaged the extension of brand name products, but also implicate the strong brand. You don't have to own a large business to benefit from this kind of expansion. A brand differentiate these products from those of competitors. A discussion of the key points is presented and then a final conclusion to hammer out the reason for the need to implement the strategy Brand extension, which entails the use of a given brand name which is established in a given product class in entering another product class is noted to be hugely beneficial to several organizations Tauber,1988.
Extending a product line involves adding new features to existing products, rather than developing completely new products. Adding features that your competitors offer may enable you to deal with prospects that you cannot currently supply with existing products. Keller 2003 pointed out that the concept of brand extension is clearly defined whenever a given firm employs an established brand name in the introduction of a totally new product. Those few that have succeeded with broad based extensions have a benefit thread running through their products that customers of the respective categories want. For example, a popular brand of car wax recently put out a product for removing film build-up from car headlight covers.
Journal of Business Research, 53, 111-22 Chen, K. It didnt work out because it was out of synchronization with retail practices. Additionally, the relationship of the given brand with its customers in regard to customer loyalty is most likely to be strengthened. Runs counter to consumer sentiment. Hershey could not have efficiently entered the peanut butter category without the Reeses brand.
This gives Gillette a wide product mix. Excerpt from Essay : Brand Extension The disadvantages of employing extension strategy This work compeers and contrasts the merits and demerits of implementing brand extension a s a by various firms. Despite all the advantages of employing brand extension as strategy, Taylor 2004 indicated that one in two brand extension initiatives often fail. Defensive strategy A brand extension can effectively prevent competitors from acquiring or even exploiting a sizeable market share and foothold in a given market and can prove to be worth while as a growth strategy Aaker,2004. There are more advantages and disadvantages, but those are the core of both for me. Some critics denounce the concept of brand extension vigorously since they feel that it makes companies to lose focus as well as makes their customers confused. Introduce products that reflect the brands distinctive benefit, attribute or feature.
Virgin offered value in differentiated services like their airline. A brand mark is the visual representation of the brand like a symbol,design,distinctive coloring or lettering. Introduce the same product in a different form2. Know Your Product's Life Cycle Every product you introduce has a life cycle of its own-some long and others quite short. It is worth noting that an accident caused by a… References Aaker, D.
If the improper use of the brand extension, the original strong brand image represented by the information was weakening. A brand is short is an identifier of the seller or the maker. An established brand name increases consumer interest and willingness to try new product having the established brand name. Perceptual Fit: The consumer must perceive the new item to be constant with the parent brand. Oranjolt was a fruit drink in which carbonates were used as preservative. Cost reduction When compared to the process and cost of launching a totally new brand, the brand extension strategy is generally less costly since the new product generally employs a similar name as the brand which is already known. The purpose is to drive the attention of the management to what they can achieve while entering more categories with the same brand and which are the main risks they have to try to prevent or overcome and how they can do so.