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. This is because a product mix is the total set of brands that are marketed by a business; therefore, it contains several product lines.
Consider the following brands and discuss the extendibility of brands
Brand extension refers to a marketing strategy in which a a business that is marketing a product with a robust image uses the same brand name in a different brand category. It is also known as brand stretching because organizations use it as a strategy to leverage and increase the organization’s brand equity. This helps in increasing awareness of the brand and at the same time increases the organization’s profitability from offerings in more than one product category. Brand extension is wholly dependent upon how strong consumer’s associations are to the brands goals and even values.
Harley-Davidson
Founded in 1905, the Harley-Davidson Motor Company was the only motorcycle manufacturer in the U.S after Indian Motorcycles closed down back in 1953. The American “Motorcycle culture” grew between the 1950’s and ‘60s. This was influenced by movies such as “wild ones” and “Easy Rider”, which helped equate the Harley-Davidson with a lifestyle of a motorcycle outlaw who were perceived as to...
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...not popular the masses, because the product is often seen as a quintessential Australian product.
Summary
During the early 1990’s, many new products used brand extension to create sales and introduce new brands into the market. Brand extension helps to mitigate budget constraints and costs used for launching a new product. This is because launching a new product not only needs a big budget but it is also time consuming. Brand extension is instrumental in the creation of awareness and the promotion of the product’s benefits. It helps reduce financial risk by using an established parent name to enhance consumers’ perceived perception of the brand due to brand equity. This paper examined a number of brands and its successes and failures in terms of brand extendibility, these brands include Harley-Davidson, Red Bull, Tommy Hilfiger, Victoria’s Secret and Vegemite.
Thus new products/line extensions will be based on Allround brand, each one with a unique target market, delivering different value proposition to the respective customer.
Sarkar, A. N., & Singh, J. (2005). New paradigm in evolving brand management strategy. Journal of Management Research, 5(2), 80-90. Retrieved from http://search.proquest.com/docview/237238894?accountid=28644
Brand extension failure: Colgate's Kitchen Entrees frozen dinners, Smith and Wesson bicycles, Frito-Lay Lemonade, Maxwell House Ready-To Drink Coffee and Clairol's “Touch of Yogurt” shampoo are great examples.
“Your branding strategy defines what you stand for, a promise you make, and the personality you convey” (“Brand Strategy”, 2015, para. 2). As well, it assists in the presentation of your product or service to stand out from the competition. According to Berkowitz (2011), there are five types of branding strategies: multiproduct, multibrand, reseller, co-branding, and mixed. The multiproduct branding strategy uses one name for all the various products within the company. For example, the hospital I work for includes its name in the off campus imaging centers, surgical outpatient centers, and free-standing emergency departments. As a result, customers are more inclined to associate the name with the good reputation, high standard of quality of care, and patient satisfaction of the brand. The multibrand strategy uses different brand names for each of its products. For example, Johnson & Johnson has various product lines which have their own brand name such as consumer health products, medical devices, and pharmaceutical products (http://www.jnj.com/). The purpose of this type of strategy is to attract and influence diverse market sections (Berkowitz, 2011). The reseller strategy is used when; one company purchases products from other companies and sells the products under their company name because they do not have the ability to manufacture the products themselves. Last, with
In order to create a successful brand extension, we have to heuristically decide how to raise the sale of our business and put the right strategies in the right time. As an illustration, Marks & Spencer, the retail sale of clothing, has been auspiciously broadened its new goodies and services such as the retail sale of food, furniture, and financial service. After extended, Marks & Spencer found out that the Financial services now account for 18 percent of the group's total operating profit. Withal, plenty people still believe that brand extension leads a business to a failure. It is not about the brand extension but it is about how we understand and manage
We propose a branding strategy which takes into account the brands capabilities and competencies, strategies of competition brands and the outlook of consumers experience in their respective societies. As an international brand there is the challenge of staying connected with local customers. We will overcome this by adapting marketing strategy to local needs using a variance of standardized marketing mix and an adapted marketing mix.
Gone are the days when supersizing brand portfolios and product line extension were the pioneer strategy to rule the domestic market and conquer the global ones. Brand rationalization has emerged as the “panacea” to overcome the ills of supersized portfolios- be it the FMCG, Mobile services, Electronics or Automotive sector. However, the implementation of Brand rationalization (reducing the portfolio size by deleting or merging brands) has its own challenges.
Brand Extensions: A company may use its existing brand name to launch new products in other categories. Brand extension refers to the expansion of the brand itself into new territories or markets. For instance, if a soft drink manufacturer unveils a line of juices or bottled water products under its company name, this would constitute an example of brand extension. Gap stores now feature its name on soap, lotion, shampoo, conditioner, shower gel, bath salts, and perfume spray.
Branding aims to establish a significant and differentiated presence in the market that attracts and retains loyal customers. Branding is important for customers because the customer knows that the company they are buying from if there were two phones at the same price and same product but one was apple and the other were a unknown company, people would buy the apple because it is apple and they have shown their products to be of high quality. Also people would buy from Tesco because their branding is that there groceries are cheap and of high quality. Apple have built their brand up and their position. When people buy an apple product, they know the product will be of a high quality, that is the message that apple are trying to convey. One of the ways they have done this is that they train staff to present a specific image, so when you go to an apple store you will see that the staff carry with them IPads and other apple devices. Tesco have built their brand and positon to have the finest own-labeled products. They have done this buy making more Tesco brands. Brand extension is a common method of launching a new product by using an existing brand name on a new product in a different category. Apple use brand extensions because apple have launched many products under the same brand ‘apple’. Tesco use
Brand extension means existing brand with new products and coke had not selected this strategy yet.
Product is the core of marketing, which including tangible goods like food or drinks or intangible services, as it is the major way to embody customers requirements; and, branding is directly associated with it. In fact, branding is all about decisio ns of products, like brand names or trademarks. Stork (2007) asserted that a brand is a unique business identity which represents the personality, quality or origin of products. And, such a product which added value by branding would appear in every activity of marketing, namely, branding is actually react on the whole marketing system directly and indirectly.
To begin with the benefits, product line extensions meet the different segments’ needs. Products in a certain line sometimes may not attract wide variety of different segments. In these situations, the company could decide to introduce a new product into the market to increase
This article studies the relationship between advertising and sales promotions and their impact on brand equity. A main priority for most companies is to establish and achieve a strong and powerful brand name. A company can build a strong brand name by creating the market for their customers want. By creating a strong brand name, a company will become more established. Brand equity is important to the producer, retailer and consumer. The consumer knowledge of the brand says how the producer will produce and market the product. The consumer knowledge of the brand name also determines the quantity the retailer will sale. Brand equity can have a positive or negative effect. A positive effect would be for everyone to recognize the name and purchase the product. The negative effect would be to have the product recalled. Brand equity is important because it can offer many advantages for a company. Brand equity can create a high demand for your product, reduce marketing cost and the company’s brand name will have high credibility.
Branding is used to refer to a wide body of literature as to how businesses can use their brands to achieve a competitive advantage, through building brand equity, launching brand extensions, managing global brands, and so forth.
Brand could be anything a name, sign, term, symbol or a design that differentiate a company’s product and services it from the competitors. Brands directly affect the consumer’s purchase behavior (Erdem, et al., 2002). Furthermore, Branding is a mean for differentiation which leads to get competitive advantage over customers, brand equity helps in building a brand (pappu, et al., 2005).