Brand Extension Case Study

substantial investments not only in creating a new brand concept but also in advertising the new product on the market, as well as supporting it during its life cycle. Some marketers doubt that a brand extension is the universal way of revitalizing a brand. It is instead believed that many managers choose to use this strategy because it is fashionable, with the risk of companies embracing the use of a brand extension before consuming all the resources for growth of the parent brand. Developing a new brand can be expensive, time consuming and obviously not always easily conducted nor well received. Moreover, it requires substantial investments not only in creating a new brand concept but also in advertising the new product on the market, as well as supporting it during its life cycle. Some marketers doubt that a brand extension is the universal way of revitalizing a brand. It is instead believed that many managers choose to use this strategy because it is fashionable, with the risk of companies embracing the use of a brand extension before consuming all the resources for growth of the parent brand. Product knowledge can help consumers to evaluate brands from a product-related aspect, while brand knowledge helps consumers to evaluate brands from a non-product-related facet. So ‘Product knowledge’ refers to information about product categories, either the most general category, or subcategories stored in a consumer’s memory, where as

Nielsen’s study of top brands in 46 FMCG categories and 82 brand extensions in food and non-food categories shows that in addition to promoting brand equity, brand extensions can grow incremental sales up to 38 percent and contribute as much as 30 percent to parent brand