Brand extension mite


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  • One of the few good slides i came across in the recent past.
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  • Dear Ashwini , I read carefully about brand extension and Line extension whole is very good but at a moment i need about Line extension only which is not seen there ,

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  • Major Branding Decisions This CTR corresponds to Figure 8-3 on p. 247 and relates to the material on pp. 247-252. Major Branding Decisions Brand Decision. At this stage, the company must decide whether or not to place a brand name on its product. Brands usually command higher profit margins than non-brands. Brand Name Selection . Desirable qualities for a brand name include: 1. It should suggest something about the product’s benefits. 2. It should be easy to pronounce and remember. 3. It should be distinctive. 4. It should translate easily into foreign languages. 5. It should be eligible for registration and legal protection. Brand Sponsor. Who sponsors the brand must also be decided. Manufacturer's or National brands are owned by the producer. Private brands are created and owned by a reseller. Mixed-brand strategies combine both approaches. Brand Strategy . This decision area consists of at least four choices, covered in greater detail on the following CTR.
  • Brand Strategy This CTR corresponds to Figure 8-4 on p. 251 and relates to the discussion on pp. 250-252. Brand Strategy Companies may implement at least four brand-name strategies, including: Line Extension. This strategy occurs when a company introduces additional items in a given product category under the same brand name. The vast majority of new product introductions are line extensions. Brand Extension. This strategy seeks to extend existing brand qualities to launch new products or modified products in a new category. Multibrand. This strategy develops two or more products in the same product category. P & G pioneered multibranding. New Brands . Here a company creates a new brand name when it enters a new product category for which none of the company’s current brand names are appropriate.
  • Brand extension mite

    2. 3. What Is A “Brand” <ul><li>A BRAND is symbolic embodiment of all the information connected to a Company, Product or Service. </li></ul><ul><li>It serves to create associations and expectations from products made by a producer, in the mind of the consumer. </li></ul><ul><li>The key objective being “to create a Relationship of TRUST with its consumers”. </li></ul>
    3. 4. Major Brand Decisions Brand Strategy Line Extensions Brand Extensions Multi-brands New Brands Brand Sponsor Manufacturer’s Brand Private Brand Licensed Brand Co-branding Brand Name Selection Selection Protection
    4. 5. Brand Strategy Line Extension Multibrands Brand Extension New Brands Brand Name Existing New Product Category Existing New
    5. 6. Brand Strategy <ul><li>Line Extension </li></ul><ul><ul><li>Existing brand names extended to new forms, sizes, and flavors of an existing product category. </li></ul></ul><ul><li>Brand Extension </li></ul><ul><ul><li>Existing brand names extended to new product categories. </li></ul></ul><ul><li>Multi-brands </li></ul><ul><ul><li>New brand names introduced in the same product category. </li></ul></ul><ul><li>New Brands </li></ul><ul><ul><li>New brand names in new product categories. </li></ul></ul>
    6. 7. BRAND EXTENSIONS <ul><li>Using an existing brand name to promote a product in a different category, is Brand Extension. </li></ul><ul><li>The key difference between line and brand extension is the product category. </li></ul><ul><li>In line extension the Product Category remains constant whereas in brand extensions product category is a variable. </li></ul>
    7. 8. BRAND EXTENSIONS <ul><li>Ponds - Cold cream, Toilet soap Shampoo, Tooth paste, Moisturizing lotion, Talc & Face wash. </li></ul><ul><li>LG – Television, Refrigerators, Computer monitors, Microwaves, Air Conditioners, Washing Machines & Mobile phones. </li></ul><ul><li>Park Avenue – Shirts, Shaving cream, Jeans, Belts, Perfumes, Soap & Razor. </li></ul>
    8. 10. LINE EXTENSION <ul><li>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. </li></ul><ul><li>A line extension often adds a different flavor or ingredient variety, a different form or size, or a different application for the brand. </li></ul>
    9. 11. Coke’s Line Extension
    10. 12. <ul><li>Head </li></ul><ul><li>& </li></ul><ul><li>Shoulder’s </li></ul><ul><li>Extension </li></ul>
    11. 13. CATEGORY EXTENSION <ul><li>The parent brand is used to enter a different product category from that currently served by the parent brand. </li></ul>
    12. 14. ITC’s Category Extension
    13. 15. Why Brand Extensions? <ul><li>Leveraging brand equity/value by introduction of logical & complementary new product categories </li></ul><ul><li>E.g HP </li></ul><ul><li>Product Innovation to surpass consumer expectations </li></ul><ul><li>It increases awareness of the brand name </li></ul><ul><li>Increases profitability from offerings in more than one product category.(widening the net to catch new consumers.) </li></ul><ul><li>It’s a great way to reinforce a brand, reach out to new customers, create a BUZZ </li></ul>
    14. 16. Why Brand Extension? <ul><li>Cost of New launches </li></ul><ul><li>Promotional Efficiency </li></ul><ul><li>Consumer Benefits </li></ul><ul><li>Feedback effects </li></ul><ul><li>Returns </li></ul>
    15. 18. Advantages Of Brand Extensions <ul><li>Improve brand image </li></ul><ul><li>Reduce risk perceived by </li></ul><ul><li>Customers </li></ul><ul><li>Permit consume variety-seeking </li></ul>
    16. 19. Advantages Of Brand Extensions <ul><li>Clarify brand meaning </li></ul>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
    17. 20. Advantages Of Brand Extensions <ul><li>Increase the probability of gaining distribution and trial </li></ul><ul><li>Increase efficiency of promotional expenditures </li></ul><ul><li>Reduce costs of introductory & follow-up marketing programs (save 40-80%) </li></ul><ul><li>E.g. Apple iPods </li></ul><ul><li>Avoid costs of developing a new brand </li></ul><ul><li>Allow for packaging & labeling efficiencies </li></ul>
    18. 21. Advantages Of Brand Extensions <ul><li>Enhance the parent brand image </li></ul><ul><li>Bring new customers into brand franchise and increase market coverage </li></ul><ul><li>Revitalize the brand </li></ul><ul><li>Permit subsequent extensions </li></ul>
    19. 23. Disadvantages Of Brand Extensions <ul><li>Can fail & hurt parent brand image </li></ul><ul><li>Xerox Computers -synonymous with copiers & no one believed they could make computers </li></ul><ul><li>Can succeed but cannibalize sales of parent brand </li></ul><ul><li>Amul Butter -”reduced salt butter” </li></ul><ul><li>is slowly eating up Amul normal butter </li></ul>
    20. 24. Disadvantages Of Brand Extensions <ul><li>Can succeed but diminish identification with any one category </li></ul><ul><li>Can succeed but hurt the image of parent brand </li></ul>
    21. 25. Disadvantages Of Brand Extensions <ul><li>Can confuse or frustrate consumers </li></ul><ul><li>Can encounter retailer resistance </li></ul><ul><li>Can dilute brand meaning </li></ul><ul><li>Can cause the company to forgo the chance to develop a new brand </li></ul>
    22. 26. When are Brand Extensions Appropriate? <ul><li>When Prior Brand equity exists </li></ul><ul><li>Consumer must see some “connection” between the proposed extension and the parent brand. </li></ul><ul><li>The proposed extension contributes to and reinforces the overall brand equity of the parent brand. </li></ul>
    23. 28. Conditions For Evaluating Consumer’s Brand Extension <ul><li>Consumers have some awareness & positive associations about the parent brand </li></ul><ul><li>At least some of these positive associations will be evoked by the brand extension </li></ul><ul><li>Negative association are not transferred from the parent brand </li></ul><ul><li>Negative associations are not created by the brand extension </li></ul>
    24. 29. Evaluating Brand Extension 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