Brand Extension Success Factors

Brand Extension Success Factors

Length: 976 words (2.8 double-spaced pages)

Rating: Excellent

Open Document

Essay Preview

More ↓
Brand extension success factors

Problem definition and objectives

In a highly competitive environment, organizations are convinced that the launch of new products in order to stratify the need of consumers can lead to an increase the success of a company. The strategy of launching new products can be successful but it remains some risks. Indeed, the launching from 30 to 35 % of new products has failed. Because of some factors like the high level of advertisement costs and the increasing competition, it becomes more and more difficult to introduce new products on the market.
A strategy to reduce these risks that becomes more and more popular is to follow a brand extension. Indeed, this strategy gained grown since 1984. In the USA, until 1984, the share of extension products in total new product introductions in the fast-moving consumers goods segment was only 40% (Aaker & Keller 1990, p. 27), the share amounted to 90% in 1991 (Rangaswamy & Burke & Oliva 1993). During the two decade, more than 40 studies have been made all over the world in order to determine the conditions that make a successful brand extension but some aspect are unknown or unexplored.
In this work, our goal is to determine exactly what the factors of a successful brand extension are and how these factors are valorized regarding the consumer’s perceptions. In order to maximize our chances of efficiency, we will first focus on the theory and after we will ask different segment of the population to respond to a questionnaire about a brand that we choose previously: Virgin.
Tell that we will apply our theoretical approach to two brands, one which failed and another one which is a full success. The questionnaire will understand the impact of consumer’s behavior and expectation in a typical brand extension’s situation.
Then we have to describe a problematic like:
What are the factors that the group Virgin uses to lead its brand extension strategy successfully?
In other words,
In which sectors have Virgin succeed or failed in terms of extension strategy?

Theoretical grounds

Description of the brand extension’s concept

First, we will base our approach on a theoretical basis in order to explain the foundations of our work and our questionnaire.
The brand extension is a marketing strategy that uses the same brand name to different product, to product in different category or the same category. It is a risky strategy that has to aim to increase the sales or the brand equity.

How to Cite this Page

MLA Citation:
"Brand Extension Success Factors." 28 Mar 2020

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

Successful Brand Extensions Essay

- Introduction Brand extension refers to the successful use of an already successful brand name to launch a modified or new product in a new market or niche. The management of brands is a key element in product strategy in any given business, especially those that operate in highly competitive markets. Brands cannot be developed in isolation, in that they normally categorized within a business product group or product lines. In relation to a product mix, its width can be measured by the number of product lines that a business enterprise offers....   [tags: Brand Extension Essays]

Research Papers
926 words (2.6 pages)

Situation Analysis : 5c 's ' One Environmental Factor That Provides Opportunities For Allstar Allround Brand

- Situation Analysis: 5C’s One environmental factor that provides opportunities for Allstar Allround brand is recommendations from doctors and physicians. These recommendations can increase this company’s market share, net income, and brand awareness. Allround brand offers 4- Hr. Multi Liquid medication. One recommendation from doctors and physicians can turn into multiple recommendations which the company can profit from it. The company can profit from these recommendations because customers will go purchase our product....   [tags: Marketing, Target market, Common cold, Target]

Research Papers
1230 words (3.5 pages)

Company of Wal-Mart Essay example

- Wal-Mart Stores Inc. is the largest retail company in the United States and has been ranked number one on the Fortune 500 Index by Fortune Magazine. However despite the fact that the company is big, it has not survived or evaded the normal challenges that corporations go through, irrespective of whether private or public (David, 2012). For instance, the living wage bill of the United States resulted in Wal-Mat threatening to close down its stalls in the United States. Due to its resolution to cutting down on its employees, Wal-Mart has also been characterized by customer complaints as a result of empty shelves....   [tags: Success, Threats, Labor Relations]

Research Papers
1118 words (3.2 pages)

Marketing Pl Global Branding Strategy Essay

- Task 3: Global branding can allow for the brand extension to spread risk, reach stronger position, and get high profits return (Riezebos, 2003). However, it is hard to achieve ‘brands that travel well’ in another country (Macrae, 1991). Figure 3 shows international branding strategy, there are nine brand-related aspects that need the global brand to consider. Since the SMEs are flexible and the scale of SMEs is small, so SMEs especially need to pay attention to communication strategy, tone of voice, sales promotion, media strategy, and distribution strategy to quickly adapt to the local market....   [tags: Branding, Brand, Luxury good, Luxury vehicle]

Research Papers
1441 words (4.1 pages)

Impact of Brand Extensions on Brand Equity Essay

- Part One: Impact of Brand Extensions on Brand Equity In today’s competitive marketplace it is vital to have a strong brand name. When a company develops a strong brand name of a certain product category they start thinking about the brand extensions, which will help the firm to capture new and unexplored market segments. According to Kotler (2003) a brand extension occurs when a company uses its well-established core brand name to introduce new products in either similar or different product category....   [tags: competitive markets, marketing]

Research Papers
537 words (1.5 pages)

Essay on A Brand Strategy Always Guarantees Success

- A Brand Strategy Always Guarantees Success This essay intends to define brand strategy and if a brand strategy is possible for all brands. It will also look into the ability and level to differentiate between different kinds of products and look into how a brand strategy can bring success. Furthermore the essay intends to shed light on whether or not these themes are transferable to all products and services. According to Trott (1998, p.365), ‘Brand strategy is the spearhead of the organisation's competitive intentions....   [tags: Marketing Branding Business Brand]

Research Papers
1870 words (5.3 pages)

Marketing : Brand Loyalty, And Factors That Influence Your Own Competitive Advantage

- With the market gradually enriched, competitive brands are steadily increasing, consumers can choose from different brand. Many companies use brand to create and cultivate their own competitive advantage. This has become one of the main strategies used by companies in the international marketing competition. Brand loyalty is when consumers make purchasing decisions, they too many times to express the preference for a brand. It decides the value and influence of the brand, and affects the establishment of market position....   [tags: Brand, Marketing, Brand loyalty, Brand management]

Research Papers
1537 words (4.4 pages)

Brand Extension Essays

- Product Brassington (2007) point out that product is not only the physical product, it also include brand, after-sales service, guarantees, installation and fitting which could help product to gain advantage in competitions. Kotler (2007)also point out that product is the goods which is easy for people to be attract, to contract, use and fulfil people’s desire. He also said that the product could be physical products, services, people and organizations. Product range A company could provide a single kind of product or various kinds of products to their client....   [tags: Marketing]

Research Papers
1661 words (4.7 pages)

The Chocolate Brand Essay

- 23% 77% 3.If national which one of below. (A)Amul……….....,(B)Cadbury………….,(C) Nestle………… Amul Cadbury Nestle 32% 48% 30% 4.How frequently you consume chocolate. (A)Daily……….,(B)Weekly…………, (C)Monthly…………..,(D)Occasionally………….. Daily Weekly Monthly Occasionally 22% 20% 18% 40% 5.On what basis you select the chocolate brand. (A)Brand…………,(B)Taste…………, (C)Price…………..,(D)Quality…………… Brand Taste Price Quality 22% 27% 18% 33% 6.Which type of chocolate you prefer....   [tags: Brand, Brand management, Consumer]

Research Papers
1468 words (4.2 pages)

Factors that Make a Difference in Marital Success Essay

- The most important quality of a married couple is love. Attitudes and responsibilities are some important factors for the development of a good marriage. Building a happy marriage is the result of conscious effort on the part of a husband and wife. A lifelong union, that people bound together by a bond of love, which is spiritual as well as physical, can be considered marriage. Marriage is socially recognized and approved union between individuals, who give to one another with the expectation of a secure and lasting personal relationship....   [tags: Marriage Success]

Research Papers
1932 words (5.5 pages)

Related Searches

In other words, “the use of established brand names to enter new product categories or classes” (Keller & Aaker 1992, p. 35)
There exist several examples of brand extension that works or not: BIC launch a perfume but it was a failure. Contrary, Virgin launches new products and new services with the same brand name: Virgin music, Virgin Cola,…

What are the key factors for succeeding in brand extension Strategy?

There are many factors for succeeding in a brand extension strategy. Those factors are often under-estimated by manufacturers who extend their brand just for savings reasons. Indeed creating a new brand for a launching product is an expensive step that could be avoided by stretching an existing brand. Other extends brand as many categories as possible in hope of just adding sales and improving brand image.
However, if this marketing strategy is efficiently applied it can have several positive consequences like create synergies, reinforce the brand image, and have a better approach on consumer’s needs.
The main idea to understand the success of a brand extension is to consider the consumer’s evaluation concerning the fit and the level of leverage between the brand extension and the core brand. Those two main factors describe two axes of consumer’s perceptions and expectations:
• “Fit”: The fit between the expectation brand and the care brand is probably the most important factor of a successful brand extension. It refers to the boundaries issue of the different product categories under the same brand. In other word, Fit is the stretch-ability of categories that consumer could accept for a brand.
• “Image”: The brand image is the factor that influences the consumer’s behavior regarding the new category of product under the evaluation of the core brand image. We’re talking here about the global perception of brand personality.
• “Credibility”: reflects the standing of the extended product in terms of price, quality, customers services,...
• “Leverage”: is the typical properties owned by a brand that gives a competitive advantage to the brand extension in its new category. We could also include in this section the “Transfer” factor which is the ability of a brand to transfer experience and skills to the brand extension.
If we consider that a brand extension has to be spread on these axes regarding consumer’s expectation, we can extract some statement from those definitions and construct some basic principles for a successfully brand extension.
First of all, a brand stretching has to be logical with consumer’s expectations. The extended product must fit with the brand’s categories of existing products.
Secondly, parent brands must own some distinctive properties that give a competitive advantage to the company. Those attributes are not necessary to be exclusive ones but have to be important in the new category.
Finally, the brand image has also a decisive impact on consumer’s perception of an extended product. People tend to identify themselves to the personality of a brand. If these characteristics are well shared between categories, it will provide the new product an existing notoriety.
All these factors we’ve summarize to explain a successful brand extension are independent and distinctive to each brand extension strategy. All manufacturers have different strategies to launch a new product. Some will benefit from special management skills and have a high leverage level when other will just change the recipe of their product and rely on the “Fit” and “Image” factor for their chance of succeeding.
Return to