1. BRAND EXTENSION

2. ADVANTAGES OF BRAND EXTENSION
a. Facilitates New Product Acceptance
 Reduces risk perceived by customers.
 Increases the probability of gaining distribution
& trial.
 Increases efficiency of promotional expenditures.
 Reduces cost of introductory & follow up mktg.
programs.
 Allows for packaging & labeling efficiencies.
 Permits consumer variety seeking.

3. b. Provides Feedback Benefits to the Parent
Brand & Company
 Clarifies Brand meaning.
 Enhances the parent Brand Image.
 Brings new customers & increase mkt. coverage.
 Revitalizes the Brand.
 Permits subsequent extensions.

4. DISADVANTAGES OF BRAND EXTENSIONS
 It can confuse or frustrate consumers.
 It can encounter retailer resistance.
 It can fail & hurt parent brand image.
 It can succeed but cannibalize sale of parent brand.
 It can succeed but hurt the image of the parent brand.
 It can dilute brand meaning.
 It can forgo the chance to develop a new brand.

5. Assumptions To Result in Favorable Consumer Evaluations
Of an Extension
 Consumers have some awareness of & positive Associations about the
parent brand in memory.
 At least some of these positive associations will be evoked by the brand
extension.
 -ve associations are not transferred from the parent brand.
 -ve associations are not created by the brand extension.

6. BRAND EXTENSION & BRAND EQUITY
CREATING EXTENSION EQUITY:
It depends primarily on three consumer – related factors:-
 How salient parent brand associations are in the minds of consumers
such as what information comes to mind about the parent brand,
when they think of the proposed extension & strength of associations.
 How favorable any inferred associations – whether good or bad.
 How unique any inferred associations ie in comparison to competing
brands.

7. CONTRIBUTING TO PARENT BRAND EQUITY:
It depends on consumer brand knowledge on:-
 How compelling the evidence is concerning the corresponding attribute
or benefit association for product performance or imagery.
 How relevant or diagnostic the extension evidence is concerning the
attribute or benefit for the parent brand or product performance or
imagery in other categories.
 How strongly existing attribute or benefit associations are held in
consumer memory for the parent brand.

8. WHAT IS CULT BRAND?
 These are special class of magnetic brands that command
super high customer loyalty & almost evangelical customers
or followers who are devoted to them.
 Successful brands embrace their customers by anticipating
basic & spiritual human needs.

9. DIFFERENCE BET. DESTRUCTIVE & BENIGN CULTS
 Destructive cults harm, hurt, manipulate & often brainwash
their members.
 Benign cults help fill the emotional needs& wants of their
follower in a positive way.
WHY CULT BRANDING WORKS?
 Cult brands aren’t just companies with products/ services to
sell.
 To many other followers, they are a living, breathing
surrogate family filled like minded individuals.
 They are a support group that just happens to sell products/
services.

10. WHAT MAKES A GREAT CULT BRAND?
There are seven rules:
Rule – 1
 Consumers want to be part of a group that is different.
Rule – 2
 Cult brand inventors show daring & determination.
Rule – 3
 Cult brands sell lifestyles.
Rule – 4
 Listen & create cult brand evangelists.
Rule – 5
 Cult brands always create customer communities.
Rule – 6
 Cult brands are inclusive.
Rule – 7
 Cult brands promote personal freedom & draw power from
from their enemies.