Brand Extension is the use of an established brand name in new product categories. This new category to which the brand is extended can be related or unrelated to the existing product categories. Show
A renowned/successful brand helps an organization to launch products in new categories more easily. For instance, Nike’s brand core product is shoes. But it is now extended to sunglasses, soccer balls, basketballs, and golf equipments. An existing brand that gives rise to a brand extension is referred to as parent brand. If the customers of the new business have values and aspirations synchronizing/matching those of the core business, and if these values and aspirations are embodied in the brand, it is likely to be accepted by customers in the new business. Extending a brand outside its core product category can be beneficial in a sense that it helps evaluating product category opportunities, identifies resource requirements, lowers risk, and measures brand’s relevance and appeal. Brand extension may be successful or unsuccessful. Instances where brand extension has been a success are-
Instances where brand extension has been a failure are-
Advantages of Brand ExtensionBrand Extension has following advantages:
Disadvantages of Brand Extension
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View All Articles Authorship/Referencing - About the Author(s)The article is Written By “Prachi Juneja” and Reviewed By Management Study Guide Content Team. MSG Content Team comprises experienced Faculty Member, Professionals and Subject Matter Experts. We are a ISO 2001:2015 Certified Education Provider. To Know more, click on About Us. The use of this material is free for learning and education purpose. Please reference authorship of content used, including link(s) to ManagementStudyGuide.com and the content page url. Why is it important to make sure that a particular brand name is not the property of another company?A business needs to make sure its chosen brand name is not the property of another company, since it is illegal to use another company's brand name. The name should be appropriate for packaging and advertising. Because of space limitations in the media and on product labels, the brand name should not be too long.
What are the benefits of having a large brand name quizlet?Branding makes it easier to introduce new products. Branding helps create barrier against successful imitation by competitors. Branding makes it possible for Firms to charge higher prices.
Why is brand extension a popular marketing strategy?Why Is Brand Extension a Popular Marketing Strategy? According to Nielsen, brand extension (or brand stretching) has a likelihood of success five times that of new product launches. Extensions also leverage equity, increase efficiency, and enjoy faster consumer adoption.
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