Brand extension mite
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Transcript of Brand extension mite
MODULE-6 MODULE-6 BRAND EXTENSION BRAND EXTENSION
What Is A “Brand”What Is A “Brand”A BRAND is symbolic embodiment
of all the information connected to a Company, Product or Service.
It serves to create associations and expectations from products made by a producer, in the mind of the consumer.
The key objective being “to create a Relationship of TRUST with its consumers”.
Brand StrategyBrand StrategyLine Extensions
Brand ExtensionsMulti-brandsNew Brands
Line ExtensionsBrand Extensions
Multi-brandsNew Brands
Brand SponsorBrand Sponsor
Manufacturer’s BrandPrivate Brand
Licensed BrandCo-branding
Manufacturer’s BrandPrivate Brand
Licensed BrandCo-branding
Brand Name SelectionBrand Name Selection
SelectionProtection
SelectionProtection
Major Brand Major Brand Decisions Decisions
Brand Brand StrategyStrategy
LineExtension
Multibrands
BrandExtension
NewBrands
Bra
nd
Nam
e
Existing New
Product Category
Existing
New
Brand StrategyBrand StrategyLine ExtensionLine Extension
◦ Existing brand names extended to new forms, sizes, and flavors of an existing product category.
Brand ExtensionBrand Extension◦ Existing brand names extended to new
product categories.Multi-brandsMulti-brands
◦ New brand names introduced in the same product category.
New BrandsNew Brands◦ New brand names in new product categories.
BRAND EXTENSIONSBRAND EXTENSIONSUsing an existing brand name to
promote a product in a different category, is Brand Extension.
The key difference between line and brand extension is the product category.
In line extension the Product Category remains constant whereas in brand extensions product category is a variable.
BRAND EXTENSIONSBRAND EXTENSIONSPonds - Cold cream, Toilet soap
Shampoo, Tooth paste, Moisturizing lotion, Talc & Face wash.
LG – Television, Refrigerators, Computer monitors, Microwaves, Air Conditioners, Washing Machines & Mobile phones.
Park Avenue – Shirts, Shaving cream, Jeans, Belts, Perfumes, Soap & Razor.
LINE EXTENSIONLINE EXTENSIONThe parent brand is used to brand
a new product that targets a new market segment with in a product category currently served by the parent brand.
A line extension often adds a different flavor or ingredient variety, a different form or size, or a different application for the brand.
Coke’s Line ExtensionCoke’s Line Extension
Head
&Shoulder’s
Extension
CATEGORY EXTENSIONCATEGORY EXTENSIONThe parent brand is used to enter
a different product category from that currently served by the parent brand.
ITC’s Category ITC’s Category ExtensionExtension
Why Brand Extensions?Why Brand Extensions?Leveraging brand equity/value by
introduction of logical & complementary new product categories
E.g HPProduct Innovation to surpass consumer
expectationsIt increases awareness of the brand nameIncreases profitability from offerings in
more than one product category.(widening the net to catch new consumers.)
It’s a great way to reinforce a brand, reach out to new customers, create a BUZZ
Why Brand Extension?Why Brand Extension?Cost of New launchesPromotional EfficiencyConsumer BenefitsFeedback effectsReturns
Advantages Of Brand Advantages Of Brand ExtensionsExtensions
Improve brand image Reduce risk perceived by Customers Permit consume variety-seeking
Advantages Of Brand Advantages Of Brand ExtensionsExtensionsClarify brand meaning
Brand Original Product
Extension Products
New Brand
Meaning
Weight Watchers
Fitness Centre
Low-calorie foods
Weight loss &
maintenance
Sunkist Oranges Vitamins, juices
Good health
Kellogg’s Cereal Nutri-grain bars,
Special K bars
Health snacking
Aunt Jemima
Pancake mixes
Syrups, frozen waffles
Breakfast foods
Advantages Of Brand Advantages Of Brand ExtensionsExtensions Increase the probability of gaining
distribution and trial Increase efficiency of promotional
expenditures Reduce costs of introductory & follow-
up marketing programs (save 40-80%) E.g. Apple iPods Avoid costs of developing a new brand Allow for packaging & labeling
efficiencies
Advantages Of Brand Advantages Of Brand ExtensionsExtensions
Enhance the parent brand image Bring new customers into brand
franchise and increase market coverage
Revitalize the brand Permit subsequent extensions
Disadvantages Of Brand Disadvantages Of Brand ExtensionsExtensions
Can fail & hurt parent brand image Xerox Computers-synonymous with
copiers & no one believed they could make computers
Can succeed but cannibalize sales of parent brand
Amul Butter-”reduced salt butter” is slowly eating up Amul normal
butter
Disadvantages Of Brand Disadvantages Of Brand ExtensionsExtensions Can succeed but diminish
identification with any one category
Can succeed but hurt the image of parent brand
Disadvantages Of Brand Disadvantages Of Brand ExtensionsExtensions Can confuse or frustrate consumers
Can encounter retailer resistance
Can dilute brand meaning Can cause the company to forgo the chance to develop a new brand
When are Brand When are Brand Extensions Appropriate?Extensions Appropriate?When Prior Brand equity existsConsumer must see some
“connection” between the proposed extension and the parent brand.
The proposed extension contributes to and reinforces the overall brand equity of the parent brand.
Conditions For Evaluating Conditions For Evaluating Consumer’s Brand Consumer’s Brand ExtensionExtension
Consumers have some awareness & positive associations about the parent brand
At least some of these positive associations will be evoked by the brand extension
Negative association are not transferred from the parent brand
Negative associations are not created by the brand extension
Evaluating Brand Evaluating Brand Extension OpportunitiesExtension Opportunities
Define actual & desired consumer knowledge
Identify possible extension candidates
Evaluate potential of the extension candidate
Evaluate potential candidate feedback effects
Consider possible competitive advantages & reactions
Design marketing campaign
Evaluate extension success & effects on parent brand equity