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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.The strategy behind a brand extension is to use the company’s already established brand equity to help it launch its newest product. The company relies on the brand loyalty of its current customers, which it hopes will make them more receptive to new offerings from the same brand.A brand name can fail to help an extension or, worse, can create subtle (or sometimes not so subtle) associations that hurt the extension. Worse still, the extension can succeed, or at least survive, and damage the original brand by weakening existing associations or adding new, undesirable ones.
Table of Contents
Is brand extension a good strategy?
The strategy behind a brand extension is to use the company’s already established brand equity to help it launch its newest product. The company relies on the brand loyalty of its current customers, which it hopes will make them more receptive to new offerings from the same brand.
Why are brand extensions bad?
A brand name can fail to help an extension or, worse, can create subtle (or sometimes not so subtle) associations that hurt the extension. Worse still, the extension can succeed, or at least survive, and damage the original brand by weakening existing associations or adding new, undesirable ones.
What Is A Brand Extension Strategy? (+ Good And Bad Examples)
Images related to the topicWhat Is A Brand Extension Strategy? (+ Good And Bad Examples)
What are the benefits of brand extension?
They can help the product be easily accepted. They can also improve the overall brand image. Consumers’ perceived risk can go down with brand extensions. Since the company has established the brand name as trustworthy and popular, they can also increase the interest of consumers and make them consider a new product.
What are the benefits of brand extensions V S line extension?
Benefits of Extending a Brand
Line extensions and brand extensions both allow companies to promote new products with reduced promotional costs because the new lines or brands benefit from being part of an established name.
Which of the following are disadvantages of brand extensions?
- Brand extension in unrelated markets may lead to loss of reliability if a brand name is extended too far. …
- There is a risk that the new product may generate implications that damage the image of the core/original brand.
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.
Are brand extensions an important brand growth strategy?
A robust brand extension strategy is essential to prosper and maintain relevance in today’s hyper-competitive marketplace. In some ways, brand extension represents the most efficient and logical way to achieve profitable brand growth, yet many companies struggle with how far to stretch.
See some more details on the topic Is brand extension good or bad? here:
Brand Extensions: The Good, the Bad, and the Ugly
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Brand extension: Good or bad? | Business Standard News
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What is Brand Extension? Examples + Benefits of this Strategy
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What is brand extension example?
A brand extension (some times called a category extension) is when a brand is known for one type of product starts selling a different type of product. Some example of brand extension are: Apple: from personal computers into MP3 players. Callaway: from golf clubs into footwear, apparel and golf accessories.
Why brand extensions are an attractive growth strategy for companies?
A brand extension helps a company gain new customers and have loyal customers buy more products and services. By using your brand’s equity, your company is aiming to build more onto the foundation of this business. For an example of how the right brand extensions can expand a company, McDonald’s is a good case study.
What is a brand extension? Explanation Examples
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Why the line extension is important?
Why are brand line extensions important? Brand line extensions reduce risk associated with new product development. Due to the established success of the parent brand, consumers will have instant recognition of the product name and will be more likely to try the new line extension.
What are the risks inherent in brand extensions and expanding product lines?
- Expanded line without any clear cut role leads to confused customers and confused retailers. …
- Brand loyalty is weakened. …
- Variants are copied with an intention to neutralize competition. …
- The relationship between the marketer and trade partners gets strained.
In what ways can brand extensions improve the odds of new product success?
By setting up positive expectations, extensions reduce risk. Because of the potentially increased consumer demand resulting from introducing a new product as an extension it also may be easier to convince retailers to stock and promote a brand extension.
What are the suitable condition for brand extension?
Make the brand extension a logical fit
The new product must be a logical fit to the brand, compatible, expected and follow the current brand story. The link between the new product and the parent brand should be easily tracked. The biggest brand extension pitfalls fall into this category.
Does the brand image favor a brand extension?
Brand image can be defined as the perceptions about a brand as reflected by the brand associations held in consumer memory [16]. Brand image is important for brand equity and high brand equity lead to successful brand extension [15].
What are the types of brand extension?
- Product extension. …
- Line extension. …
- Customer franchise extension. …
- Company expertise extension. …
- Brand distinction extension. …
- Transfer of component extension. …
- Leveraging a lifestyle extension.
What is meant by brand extension?
Brand extension or brand stretching is a marketing strategy in which a firm marketing a product with a well-developed image uses the same brand name in a different product category. The new product is called a spin-off.
Line Extension vs Brand extension
Images related to the topicLine Extension vs Brand extension
How do I choose a brand extension?
- Survey your brand equity. …
- Set your goals. …
- Review your resources. …
- Look into wider consumer or market trends. …
- Research your competitors. …
- Engage with your existing customers. …
- Narrow down your options. …
- Get to know your new target market.
What is the main business use of an extension strategy?
An extension strategy is a practice used to increase the market share for a given product or service and thus keep it in the maturity phase of the marketing product lifecycle rather than going into decline. Extension strategies include rebranding, price discounting and seeking new markets.
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