2. LINE EXTENSIONS
The product line is now far more representative of
customers’ varying quantity needs.
It suggests the presence of usage segmentation.
Customers differs in terms of their usage quantities.
The brand has to fill the whole spectrum with products as
per the needs of various segments.
3. Example
Bisleri is the pioneering brand in the mineral water category.
Originally, Bisleri used to come in a one litre bottle.
But recently, Bisleri has exhibited a spate of innovations.
The brand launched bottles of different sizes and quantities.
The Bisleri portfolio now includes one litre, 1.2 litre, 1.5
litre and 5 litre bottles.
5. Colour Pantene Pantene Pantene Etc.,
White Black Pink
Flavours Rasna Rasna Rasa Rose ,
Orange Mango etc
Ingredient Colgate Colgate Colgate
gel Herbal Salt etc.,
7. According to Gautam Singhania, Chairman and
Managing Director, Raymond India: "Raymond aims
to acquire a dominant position in the apparel sector in
the country.
We believe that venturing into exclusive stores for our
apparel brands will make our brands stronger and give
the right impetus to our growth plans.
We have enhanced our offerings under all our apparel
brands to provide a complete wardrobe solution."
8. "Men today want different solutions for different occasions
- formalwear, relaxed work wear, evening wear, club wear,
traditional wear, travel wear as well as sportswear.
Our brands Park Avenue, Parx and Manzoni, have different
categories to cater to this need.
Thus, all our brands offer a solution to changing men's
fashion needs at different price points," says Shreyas Joshi,
President, Raymond Apparel.
9. Why Line Extensions?
In most of the product categories including fast moving
consumer goods, consumer durables and services, line
extension has been the name of the game.
It is an expansionist move.
The firms seem to seek growth more vigorously.
10. Nine prominent reasons………
Customer Segmentation
Customer need for variety
Pricing Breadth
Capacity Utilization
Quick gains
Competitive Reasons
Trade Demands
Counter Competition
Image Benefits
11. Line Extension Risks
There are several dangers associated with line extensions.
Line Confusion - Marketers sometimes add products to
their line without sound logic and reasoning, without any
clear role and goal. This may confuse the customers and the
retailers and will affect the brand’s owner company in the
long run.
12. Line Extension Risks…
Encourage Variety seeking – Brand loyalty is every
marketers dream. By line extension, customers practice and
become the habitant of variety seeking. Hence it influence
brand switching behaviours. The loyalty is thus weakened.
13. Line Extension Risks…
Success Myopia – An idea may be a grand enough to be
converted into a full-fledged independent brand. But the
lure of extension seems to be so strong that the ideas are
brought into the market as line extensions. This implies loss
of a winning asset in the long-term.
14. Line Extension Risks…
Strained relations - When the lines expand, marketers
tend to pressurize their trade partners such as wholesalers
and retailers to carry the complete line in accordance with
their wishes. The pressure appears to be applied more
intensely at the retail level. The marketers seek adequate
shelf space, promotion and information. But at the retailers
end, it brings confusion and chaos.
The result is the strained relations between the marketer
and the retailer.
15. Line Extension Trap
Why do firms jump on to line extension bandwagon?
When customers prefer a brand, they would be just as
willing to buy a different product carrying the same name.
What appears to be logical to the managers performing these
adventures tends to be illogical in the perception of
customers.
This is the reason why line extensions do not create mega
successes.
16. Line Extension Trap…….
Line extensions do not work because they tend to go against
the fundamental aspect of positioning.
The core brand holds a strong position inside the prospect’s
mind.
Line extensions tend to educate customers that product and
brand are two different things.
It is a fallacy that a brand is just a name that can be put on any
product.
This is a great mistake. It undermines and destroys the brand
in a prospect’s mind.
17. BRAND EXTENSIONS
Using an existing brand name to promote a product in a
different category, is Brand Extension.
The key difference between line and brand extension is the
product category.
In line extension the pdt. Category remains constant whereas
in brand extensions product category is a variable.
19. Why Brand Extension?
Cost of New launches
Promotional Efficiency
Consumer Benefits
Feedback effects
Returns
20. Types of Extensions
Product form extension – A product launched in a different
form usually means line extension, but if a different product
form constitutes an entirely different product category.
Example:
Amul milk Amul Condensed milk
Real Juices Real Juice Concentrate
21. Types of Extensions
Companion Product – The idea here is to capitalise 0n product
complementarity. The consumer may view both the products
jointly.
Example :
Colgate Dental Colgate
Cream Tooth Brush
Gillette Gillette Gillette
Razors Shave forms After Shave
22. Customer Franchise
A marketer may extend a product range in order to meet the
needs of a specific customer group.
J&J J&J J&J J&J
J&J Baby Baby Baby Baby
Baby Oil Cream Shampoo Diapers
Talc
23. Company Expertise
Brand Extensions often come in the forms of different
product category introductions using a common name but
emanating from a common expertise pool. This strategy is
particularly seen in Japanese companies.
Honda
Honda
Honda Lawn
scooters
Cars movers
24. Brand Distinction
Many brands achieve distinction in the form of a unique attribute, benefit
or feature which gets uniquely associated with the brand.
For instance, Parachute may have expertise of ‘coconut nourishment’ in
customers’ minds over time. This would give Marico Industries, the brand
owner, the opportunity to launch a variety of products exploiting this
distinction.
Parachute
Hair Cooking Baby Baby
Shampoo Cream
Oil Oil Soap Oil
25. Brand Image or Prestige
A brand extension may involve a foray into unrelated
product categories based on a brand’s exclusive image or
prestige value.
Steel, Automobile, Heavy Vehicles, Watches, S/W devpt. Training etc .,
26. Distinctive Taste, Ingredient or Component
A brand may develop equity based on any and / or
combination of taste, ingredient or component. Then the
marketers can make entries into unrelated product categories
capitalising on these properties.
Nescafe Nescafe
Nescafe Nescafe Nescafe
Milk Cold
Coffee Chocolate Biscuits Supplement Coffee
28. Extensions involve transfer of associations from the parent
brand to the extension.
The brand extendability depends on its character.
The brands can be classified into 5 types through extendability.
29. Five forms of brands
The Product Brand - it is a situation where there is very
little difference between the brand and the product.
The brand is used as an identity of the product.
Example : vicks,
30. Form 2 – Formula Brand
Formula means a set procedure
A brand which comes in the formula category simply implies
that a standard procedure has been used to make the
product.
Example : cooking oil, pickles etc.,
31. Form 3 – Know – how brand
Know – how is an expertise that a firm develops in a
specialized area of activity.
Example : nokia is known for user friendly.
Amul has developed its brand as an expertise in milk
processing.
32. Form 4 – Interest brand
A brand may be defined by its centre of interest. It may
reflect its core spirit.
Example – Gillette maintains its focus on men’s grooming in
all its brands.
Logo is ‘the best a man can get’ which creates the interest
among the target audience.
Whirlpool – home maker
Nike – winning – to be on the cutting edge.
33. Form 5 - Philosophy
The brand at this level acquires more intangible character
and orientation.
The philosophy transforms its products in a realm altogether
different from its physical reality.
Example : Parker pen, De beers diamond
34. Forms of brand extendability
Product
Brand Formula
Brands
Know –how
Pillsburry
Mother’s
Atta brand Interest
Recipes
Pickles lime, Brand
mango, Bajaj Philosophy
mixed Disney Brand
Irons, Fans,
coolers, Toys, Cartier
mixers etc., Theatre,
Theme park, Watches,
movies, etc
jewellery,
Bags, pens
35. Extensions……………….
Extensions are not simple as they appear to a layman.
Consumers reject extensions when they do not make sense.
Brand extension is not a physical act of merging two
products.
It is a tough process involving marrying two cognitive or
perceptual concepts in order to create a consistent entity.
Therefore, it must begin with exploring the brand in a
prospect’s mind.
36. Exploring the brand involves seeking answers
to the following questions…….
What is a brand’s awareness level?
What are its recall and recognition levels?
What are different attributes associated with a brand?
What benefit associations are connected with a brand?
What are a brand’s personality associations?
What are the symbols associated with the brand?
What are a brand’s user associations?
What is the perceived essence of the brand?
What is a brand’s philosophy?
37. Strength of Associations - Ponds
PONDS
Talc Body Cream
Feminine Floral
care
Room
Nail Freshner, Body Beauty cream,
-Body Talc Conditioning
enamels soaps, lotion,
-Talc for cream,
Lip colours Fragrance, Body oil, cleansing
Special
etc shampoo, creams cream, etc
occasions
etc
38. Making an Extension successful
Aaker & Keller proposed certain assumptions about consumer behaviour
which are fundamentally responsible for the success of a brand
extension.
The parent brand enjoys positive beliefs and favourable attitude in
customers memory.
It is these pre-existing beliefs and attitudes which help in the formation
of positive beliefs and favourable attitude toward the brand extension.
The negative associations are not transferred to the brand extensions,
also these are not created by the brand extension.
39. Questions for Assignment
Highlight atleast five brands of various product category and
find out the extension opportunities of those brands.
Find out which brand can be extended far from its present
product, and which can move just above the extension
boundary.
