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Brand Extensions Ppt 0111

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Brand extension-advantages and disadvantages …

Brand extension-advantages and disadvantages
line and category extension

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  • 1. NEW PRODUCTS AND BRAND EXTENSIONS
    By
    NavneetAgrawal
  • 2. Overview
    New Product & Brand Extension
    Advantages
    Disadvantages
    How Consumers Evaluate Extensions?
  • 3. the FASCINATING world of brands
  • 4. 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”.
  • 5. New Product & Brand Extensions
  • 6. New Product –Branding Decisions
    • A new brand – individually chosen for the new product.
    • 7. An existing brand name applied in some way.
    • 8. A combination of a new brand with an existing brand.
  • BRAND EXTENSIONS
    A Brand Extension occurs when a firm uses an established brand name to introduce a new product (approaches 2 or 3)
    When a new brand is combined with an existing brand (approach 3), the brand extension can also be a sub-brand.
  • 9. BRAND EXTENSIONS
    An existing brand that gives birth to a brand extension is the parent brand.
    If the parent brand is already associated with multiple products through brand extensions, then it may also be called a family brand.
  • 10. Types of Brand
    Extension
  • 11. LINE EXTENSION
    The 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.
  • 12. Coke’s Line Extension
  • 13. Head
    &
    Shoulder’s
    Extension
  • 14. CATEGORY EXTENSION
    The parent brand is used to enter a different product category from that currently served by the parent brand.
  • 15. ITC’s Category Extension
  • 16. Why Brand Extensions?
    • Leveraging brand equity/value by introduction of logical & complementary new product categories
    • 17. E.g HP
    • 18. Product Innovation to surpass consumer expectations
    • 19. It increases awareness of the brand name
    • 20. Increases profitability from offerings in more than one product category.(widening the net to catch new consumers.)
    • 21. It’s a great way to reinforce a brand, reach out to new customers, create a BUZZ
  • Advantages of
    Brand extensions
  • 22. Advantages Of Brand Extensions
    • Improve brand image
    • 23. Reduce risk perceived by
    Customers
    • Permit consume variety-seeking
  • Advantages Of Brand Extensions
    Clarify brand meaning
  • 24. Advantages Of Brand Extensions
    • Increase the probability of gaining distribution and trial
    • 25. Increase efficiency of promotional expenditures
    • 26. Reduce costs of introductory & follow-up marketing programs (save 40-80%)
    • 27. E.g. Apple iPods
    • 28. Avoid costs of developing a new brand
    • 29. Allow for packaging & labeling efficiencies
  • Advantages Of Brand Extensions
    • Enhance the parent brand image
    • 30. Bring new customers into brand franchise and increase market coverage
    • 31. Revitalize the brand
    • 32. Permit subsequent extensions
  • disAdvantages of
    Brand extensions
  • 33. Disadvantages Of Brand Extensions
    • Can fail & hurt parent brand image
    • 34. Xerox Computers-synonymous with copiers & no one believed they could make computers
    • 35. Can succeed but cannibalize sales of parent brand
    • 36. Amul Butter-”reduced salt butter”
    is slowly eating up Amul normal butter
  • 37. Disadvantages Of Brand Extensions
    • Can succeed but diminish identification with any one category
    • 38. Can succeed but hurt the image of parent brand
  • Disadvantages Of Brand Extensions
    • Can confuse or frustrate consumers
    • 39. Can encounter retailer resistance
    • 40. Can dilute brand meaning
    • 41. Can cause the company to forgo the chance to develop a new brand
  • When are Brand Extensions Appropriate?
    When Prior Brand equity exists
    Consumer 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.
  • 42. How Consumers
    Evaluate Extensions
  • 43. Conditions For Evaluating Consumer’s Brand Extension
    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
  • 44. 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
    Evaluating Brand Extension Opportunities
  • 45. Thank You